Employment Law
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Civil Actions Under the Private Attorneys General Act
Under the Private Attorneys General Act ("PAGA"), an aggrieved employee may bring a civil action personally and on behalf of other current or former employees and the State of California to recover civil penalties for Labor Code violations. Iskanian v. CLS Transp. Los Angeles, LLC (2014) 59 Cal.4th 348, 380. Seventy-five percent of any PAGA penalties go to the Labor & Workforce Development Agency ("LWDA"), leaving the remaining 25 percent for the employees. Id.; see also ZB, N.A. v. Superior Court (2019) 8 Cal.5th 175, 275. PAGA is intended to augment the limited enforcement capability of LWDA by empowering employees to enforce the Labor Code as representatives of the Agency. Id. at p. 383. A judgment in a PAGA action binds all those who would be bound by a judgment in an action brought by the government. Id. at 381.
Requirements for Accurate Itemized Wage Statements in California
Section 226, subdivision (a) of the Labor Code requires an employer to provide employees with “an accurate itemized statement” that includes: (1) gross wages earned; (2) total hours worked; (3) certain information for employees paid on a piece-rate basis; (4) all deductions; (5) net wages earned; (6) the pay period; (7) the employee’s name and identifying information; (8) “the name and address of the legal entity that is the employer”; and (9) all applicable hourly rates. “An employee suffering injury as a result of a knowing and intentional failure by an employer to comply with subdivision (a) is entitled to recover the greater of all actual damages or fifty dollars ($ 50) for the initial pay period in which a violation occurs and one hundred dollars ($ 100) per employee for each violation in a subsequent pay period, not to exceed an aggregate penalty of four thousand dollars ($ 4,000), and is entitled to an award of costs and reasonable attorney’s fees.” (§ 226, subd. (e)(1).) Injunctive relief and civil penalties are also available. (§§ 226, subd. (h), 226.3).
Wage and Hour Class Action Mediation Brief
Section 510 of the Labor Code and the applicable IWC Wage Order require employers to pay overtime for hours worked beyond eight in a day and forty in a week (and double-time as provided in the statute and Wage Order).
Awarding Attorneys Fees in PAGA Actions
Under PAGA, an aggrieved employee may bring a civil action personally and on behalf of other current or former employees and the state of California to recover civil penalties for Labor Code violations. Iskanian v. CLS Transp. Los Angeles, LLC (2014) 59 Cal.4th 348, 380. Seventy-five percent of any PAGA penalties go to the LWDA, leaving the remaining 25 percent for the employees. Id. PAGA is intended to augment the limited enforcement capability of by empowering employees to enforce the Labor Code as representatives of the Agency. Id. at p. 383. A judgment in a PAGA action binds all those who would be bound by a judgment in an action brought by the government. Id. at 381.
Retaliation Under the California Fair Employment and Housing Act
Under the California Fair Employment and Housing Act ("FEHA"), an employer may not “discharge, expel, or otherwise discriminate against any person because the person opposed any practices forbidden under [FEHA] or because the person has filed a complaint, testified, or assisted in any proceeding under [FEHA].” Cal. Gov. Code § 12940(h). FEHA retaliation claims follow the McDonnell-Douglas burden-shifting framework. Yanowitz v. L’Oreal USA, Inc., 36 Cal.4th 1028, 1042 (2005). To establish a prima facie case for retaliation, the employee must establish that (1) they engaged in an activity protected under FEHA, such as filing a discrimination claim; (2) the employer subjected them to adverse employment action; and (3) there was a causal connection between the employee’s protected activity and the employer’s adverse action. Id. Once the employee has established a prima facie case for retaliation, the burden shifts to the employer to provide a legitimate, nonretaliatory explanation for the adverse employment action. Id. Should the employer successfully rebut, the burden shifts back to the employee to prove intentional retaliation. Id.
Class Action Settlements in California
The well-recognized factors that a trial court should consider in evaluating the reasonableness of the value of a class action settlement agreement include, but are not limited to:[T]he strength of plaintiffs’ case, the risk, expense, complexity and likely duration of further litigation, the risk of maintaining class action status through trial, the amount offered in settlement, the extent of discovery completed and stage of proceedings, the experience and views of counsel, the presence of a governmental participant, and the reaction of the class members to the proposed settlement.Dunk v. Ford Motor Co. (1996) 48 Cal.App.4th 1794, 1801.
Accurate Time Records for Exempt vs. Non-Exempt Employees
In cases where an employer failed to maintain accurate records of employees’ hours worked, evidence of the extent of employees’ working hours must be established primarily by testimonial evidence. This is the established method of proof:“[W]here the employer's records are inaccurate or inadequate and the employee cannot offer convincing substitutes a . . . difficult problem arises. The solution, however, is not to penalize the employee by denying him any recovery on the ground that he is unable to prove the precise extent of uncompensated work. Such a result would place a premium on an employer's failure to keep proper records in conformity with his statutory duty; it would allow the employer to keep the benefits of an employee's labors without paying due compensation. . . . In such a situation we hold that an employee has carried out his burden if he proves that he has in fact performed work for which he was improperly compensated and if he produces sufficient evidence to show the amount and extent of that work as a matter of just and reasonable inference. The burden then shifts to the employer to come forward with evidence of the precise amount of work performed or with evidence to negative the reasonableness of the inference to be drawn from the employee's evidence.”Hernandez v. Mendoza (1988), 199 Cal.App.3d 721, 727 (quoting Anderson v. Mt. Clemens Pottery Co. (1946) 328 U.S. 680, 687–688).
Penalties for Violations of the Business & Professions Code
Misleading Communications in Class Action Lawsuits
Misleading communications “pose a serious threat to the fairness of the litigation process, the adequacy of representation, and the administration of justice generally.” Cheverez, supra, at *4-6; Howard Gunty, supra, 88 Cal.App4th at 582. The “responsibility to monitor communications is heightened where potential class members are unrepresented by their own counsel.” Cheverez at *6. Courts have found that this responsibility is also heightened when an employer engages in unsupervised communications with its workers regarding a settlement offer. See Marino v. CACafe, Inc. (N.D.Cal. April 28, 2017) 2017 WL 1540717 (“in the context of class action litigation, whether pre- or post-certification, unsupervised communications between an employer and its workers present an acute risk of coercion and abuse.”)
California Law: Class Action Suits & Missed Meal/Rest/Break Periods
Labor Code §§ 226.7 and 512 and the applicable wage orders require an employer to authorize and permit meal and rest periods to their employees. California law prohibits employers from employing an employee for more than five hours without a meal period of at least 30 minutes. “[A]n employer’s obligation is to provide an off-duty meal period: an uninterrupted 30–minute period during which the employee is relieved of all duty.” Brinker Rest. Corp. v. Super. Ct., 53 Cal. 4th 1004, 1035 (2012). “An employer must relieve the employee of all duty for the designated period.” Id. at 1034. An employer cannot “impede or discourage [employees] from [taking off-duty rest periods].” Id. at 1040. Section 226.7 and applicable wage orders also require employers to authorize and permit employees to take 10-minute rest periods for each four hours or major fraction thereof of work, and to pay employees their full wages during their rest periods. “[A]s a general matter,” one rest break should fall on either side of the meal break.” Id. at 1032. Unless the employee is relieved of all duty during the 30-minute meal period and 10-minute rest period, the employee is considered “on duty” and the meal or rest period is counted as time worked under the applicable wage orders. Augustus v. ABM Security Services, Inc. (2016) 2 Cal.5th 257, 264.