On May 23, 2022, in Naranjo v. Spectrum Security Services, Inc., P.3d (2022), the California Supreme Court issued an important wage-and-hour decision. In Naranjo, the Court held that meal break premiums that an employer pays to an employee for missed, late, or short meal breaks constitute wages. Consequently, an employer must report those premium payments on an employee’s wage statement pursuant to Labor Code section 226 and must promptly pay any owed premiums when an employee terminates employment or face waiting time penalties under Labor Code section 203. Naranjo also concluded that the California Constitution’s default prejudgment interest rate of seven percent applies to calculating the prejudgment interest on claims for meal and rest break premiums.
Gregg Fisch is a partner in the Labor & Employment Practice Group in the firm's Century City office.
This article originally appeared in Healthcare News on August 6, 2019.
The California Supreme Court’s 2018 landmark decision, Dynamex Operations West, Inc. v. Superior Court (Dynamex), redefines the employment relationship between entities and workers in California and creates one of the most stringent standards in the United States for classifying workers as independent contractors.
Applying the changes introduced by Dynamex can present significant complications in many industries. This is especially true for the health care industry due to California’s prohibition of corporate practice of medicine (CPOM) and its associated rules. For example, the state requires hospitals to have physicians available during all hours of hospital operation, while, at the same time, generally prohibiting hospitals from hiring physicians directly.
Due to these complexities, many California health care entities may benefit from examining the potentially sweeping impacts of this new interpretation of the law and determining near- and long-term methods for making necessary changes to their hiring and retention policies. Following is an in-depth overview of the potential implications for health care employers and how those in the health care industry will likely need to respond.
Continue Reading Unintended Consequences: Dynamex and California Health Care Employers
Many states and municipalities throughout the country have enacted laws that mandate the removal of criminal conviction history questions from job applications. This so-called “Ban the Box” movement theoretically provides individuals with criminal backgrounds the opportunity to obtain jobs for which they otherwise would not have been considered. But, these laws also provide additional burdens for employers and add additional ways for them to face liability.
Continue Reading “Ban the Box” Laws & Workplace Violence: An Employer’s Failure to Sufficiently Perform Background Checks Could Lead To Costly Negligence Liability
Recently, the D.C. Circuit Court of Appeals ruled in Home Care Association of America, et al. v. Weil, that the Department of Labor’s (“DOL”) regulations about the inapplicability of certain statutory exemptions for third-party employers of home care workers are enforceable and that the federal minimum wage and overtime rules will apply to these types of home care workers. As a result, unless the Rule’s application is stopped or otherwise delayed, those acting in the home care industry need to be aware of changes soon to take effect, and employers in particular must be ready to meet their new obligations, as of October 15, 2015.
Continue Reading Home Care Associations Seek Stay by SCOTUS of New Wage-and-Hour Rules, As the Effective Date of DOL Wage-and-Hour Regulations Quickly Approaches
In a decision issued on Tuesday, December 9, 2014, the United States Supreme Court ruled that employees are not entitled to compensation under the federal Fair Labor Standards Act (“FLSA”) for the time they spend waiting to undergo, and actually do undergo, security screenings. The Court’s unanimous decision in Integrity Staffing Solutions, Inc. v. Busk, et al., reverses a judgment of the United States Court of Appeal for the Ninth Circuit which found that Integrity Staffing employees could state an unpaid wages claim under the FLSA for undergoing a daily security screening because the screenings were required by, and for the benefit of, their employer.
Continue Reading U.S. Supreme Court Rules that Security Screening Time is Non-Compensable Under Federal Law and The Portal-to-Portal Act
On November 12, 2014, in Greg Landers v. Quality Communications Inc., the Ninth Circuit clarified a previously unsettled point of law by confirming that Fair Labor Standards Act (FLSA) pleadings must meet the specificity requirements established in the U.S. Supreme Court’s decisions in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009). Affirming the dismissal of a proposed class action against cable services company Quality Communications Inc. for unpaid overtime wages, the three-judge panel ruled that the trial court had acted properly in dismissing the suit because, in light of Twombly and Iqbal, the plaintiff’s pleadings lacked sufficient specificity to state a claim under the FLSA.
Continue Reading Ninth Circuit Rules That Twombly Standard of Specificity Applies to FLSA Pleadings
On September 10, 2014, California Governor Jerry Brown signed into law the Healthy Workplaces, Healthy Families Act of 2014. As a result, most employers in California will be required to provide up to 24 hours (3 days) of paid sick leave to their employees beginning July 1, 2015. The following are some of the key requirements of the Act.
Continue Reading California Enacts New Law Mandating Paid Sick Leave for Employees
On June 26, 2014, in Salas v. Sierra Chemical Co., the California Supreme Court held that undocumented immigrants who fraudulently obtained employment still may pursue retaliation and discrimination claims under the California Fair Employment and Housing Act (FEHA). In its decision, the Court also found that the affirmative defenses of unclean hands and after‑acquired evidence, which typically can limit an employee’s ability to obtain relief, are not complete defenses to FEHA claims brought by undocumented workers. Under the Court’s ruling, employees who used false documentation to obtain employment not only may bring such a lawsuit but also can recover lost wages, emotional distress damages and attorneys’ fees, even if they actually were never legally entitled to work for the employer.
Continue Reading Undocumented Workers May Pursue Claims Under California’s FEHA, So Says The California Supreme Court
On June 30, 2014, the US Supreme Court decided the case of Burwell v. Hobby Lobby Stores, Inc. in a 5-4 decision along partisan lines. The Court ruled that closely held, for-profit companies are entitled to certain religious freedom protections from generally applicable regulations that violate the sincerely held religious beliefs of their owners. Specifically, the majority held that such companies are exempt from the requirement under the Affordable Care Act (the “ACA” a/k/a Obamacare) to provide birth control coverage for their employees.
Continue Reading The Supreme Court’s Ruling in Hobby Lobby that Closely Held, For-Profit Companies Should Receive Religious Exemptions From ObamaCare’s Conception Mandate Likely Will Have Little Practical Impact Immediately in the Employment Arena
On June 23, 2014, the California Supreme Court issued its decision in Iskanian v. CLS Transportation Los Angeles, LLC, confirming that an express class action waiver in an employment arbitration agreement is enforceable under California law. In its decision, the Court held that its earlier decision in Gentry is no longer good law under the United States Supreme Court’s rulings as to enforceability of the Federal Arbitration Act (FAA) and also rejected the NLRB’s D.R. Horton decision that the National Labor Relations Act (NLRA) invalidates class action waivers. Meanwhile, the California Supreme Court also held that an arbitration agreement provision barring arbitration of PAGA representative claims is invalid as a matter of California public policy. Thus, employers in California now have a little more certainty as to the enforceability of their arbitration agreements and their ability to prevent their employees from bringing class actions. However, it still is possible that the matter will be appealed and the United States Supreme Court will weigh in on the applicable PAGA issues.
Continue Reading California Supreme Court Issues Iskanian Decision, Ruling that Class Action Waivers in Arbitration Agreements Are Enforceable, But Still Allows PAGA Claims to Proceed on Representative Basis
On February 10, 2014, the U.S. Treasury Department and the Internal Revenue Service announced another one-year delay for a portion of businesses covered by the Employer Mandate portion of the Affordable Care Act (also known as the “ACA” or “ObamaCare”). Specifically, otherwise-covered entities with 50 to 99 full-time employees will not have to comply with the Mandate until January 1, 2016. Meanwhile, employers with 100 or more full-time employees now only will need to offer coverage to 70 percent of their full-time employees in 2015. However, all covered employers will be required to offer coverage to the previously mandated 95 percent of full-time employees beginning in 2016.
Continue Reading ObamaCare’s Employer Mandate is Delayed for Another Year Until 2016 for Businesses with Less Than 100 Full-Time Employees and is Modified for Larger Businesses Too