Labor Employment Law Blog

By Thomas Kaufman and Travis Anderson

On December 13, 2011, the Ninth Circuit issued its most recent decision in the Sullivan v. Oracle saga. See Sullivan, D.C. No. CV-05-00392-AHS (9th Cir. Dec. 13, 2011). The decision followed the June 30, 2011 opinion of the California Supreme Court, in which the Court answered a question that the Ninth Circuit had posed to it: whether employees of a California-based employer who worked entirely outside California could sue the employer under the California Unfair Competition Law ("UCL") for the employer's alleged failure to pay overtime to non-California employees as required under the federal Fair Labor Standards Act ("FLSA"). See Sullivan v. Oracle Corp., 51 Cal. 4th 1191 (2011). Upon remand of the case from the California Supreme Court, the Ninth Circuit held that the state court's opinion was "conclusive" and justified granting summary judgment to Oracle on the UCL claims of these non-California employees. Separately, the Ninth Circuit held that California overtime law applies to non-residents who perform work within the state, another question that it posed to the California Supreme Court to answer. This blog entry, however, focuses solely on the discussion of out-of-state employees' use of the UCL to vindicate FLSA rights.

The U.S. Department of Labor (“DOL”) is cracking down on unpaid internships, finding that few “for-profit” employers can offer such internships without violating the Fair Labor Standards Act (“FLSA”).

In case of first impression for it, the Ninth Circuit clarified the validity of tip pools under the Fair Labor Standards Act ("FLSA") where the tip pool includes employees who are not customarily and regularly tipped. In Cumbie v. Woody Woo, Inc., the Court of Appeals held that where workers make more than the minimum wage and the employer takes no tip credit, tip pools including non-tipped employees do not violate the FLSA.

Sheppard Mullin partner Douglas Hart achieved a major victory for employers everywhere when the U.S. Court of Appeal for the Ninth Circuit issued its long-awaited decision in the class action lawsuit entitled Parth v. Pomona Valley Hospital Medical Center on October 22, 2009. The Ninth Circuit ruled as a matter of first impression that it is permissible for an employer to reduce pay rates to achieve cost neutrality under the Fair Labor Standards Act ("FLSA") in conjunction with the implementation of a 12-hour shift program. This decision, issued in one of the most significant wage and hour cases to reach the U.S. Court of Appeal in years, is likely to be widely cited in other cases against California hospitals and should greatly benefit the entire health care industry.

The Ninth Circuit Court of Appeals held on July 27, 2009 in Boucher v. Shaw that individual managers of a bankrupt corporation can be held liable to the corporation's former employees for unpaid wages under the federal Fair Labor Standards Act ("FLSA").

Beginning on Friday, July 24, 2009, employees who are covered by the Fair Labor Standards Act must be paid a minimum of $7.25 per hour. This increase is the last of the three increases to the Federal minimum wage provided by the Fair Minimum Wage Act of 2007. The Department of Labor has announced that a new poster reflecting this increase will be available on its website.