Monthly Archives: May 2013

Sixth District Holds That Hours-Based Compensation That in Practice Delivered an Unvarying Minimum Amount of Pay Still Not a Salary

A de Beers 3d staff salary token given to empl...

A de Beers 3d staff salary token given to employees and only usable at their stores (Photo credit: Wikipedia)

The Sixth District held on Thursday that an hours-based compensation system which was based on the number of hours worked, with no guaranteed minimum cannot be considered a salary, and therefore cannot serve as the basis for an exempt classification.  Negri v. Koning & Associates, No. H037804, __ Cal. App. 4th __ (6th Dist. May 16, 2013).  Plaintiff is an insurance claims adjuster who was paid $29 per hour with no minimum guarantee.  Slip Op. at 1.  When he worked more than 40 hours in a week, he was still paid at $29 per hour.  He brought a claim for overtime pay, and the trial court issued a defense verdict, concluding that plaintiff was an exempt employee.  Id. at 3.

The Court of Appeal reversed:

We recognize that, in practice, defendant always paid plaintiff the equivalent $29 per hour for 40 hours per week so that he, in effect, received an unvarying minimum amount of pay. We also recognize that, as a general matter, an exempt employee may be paid extra for extra work without losing the exemption. (See Kennedy, supra, 410 F.3d at p. 371.) The problem here is that defendant stipulated to the fact that it “never paid [plaintiff] a guaranteed salary”; if he worked fewer claims “he made less money than if he worked more claims.” That is the same thing as saying that plaintiff was not paid “a predetermined amount” that “was not subject to reduction based upon the quantity of work performed.” He was not paid a salary. For that reason, defendant did not prove that the administrative exemption of Wage Order 4 applies in this case.

Slip Op. at 8-9.


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Meal and Rest Break Class Certified in Light of Brinker

English: A guard at Prague Castle.

English: A guard at Prague Castle. (Photo credit: Wikipedia)

On Friday, the Court of Appeal for the Fourth District reversed a denial of certification of a meal and rest break class action.  Faulkinbury v. Boyd & Associates, Inc., No. G041702, __ Cal. App. 4th. __ (4th Dist. May 10, 2013).  Reconsidering in light of Brinker Restaurant Corp. v. Superior Court, 53 Cal.4th 1004 (2012), the court concluded that the primary issue was the legality of certain company policies, which could be determined on a class-wide basis, even if the application of the policies varied by individual.


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D.C. Circuit Holds That NLRB’s Rule Requiring Employee Rights Poster Unlawful

English: National Labor Relations Board (NLRB)...

English: National Labor Relations Board (NLRB) Member William S. Leiserson (left), Chairman J. Warren Madden, and Member Edwin S. Smith (right) during testimony before the U.S. House of Representatives Special Committee to Investigate the National Labor Relations Board (the “Smith Committee”) on December 22, 1939, in Washington, D.C. (Photo credit: Wikipedia)

Yesterday, the U.S. Court of Appeals for the D.C. Circuit held that the NLRB’s rule requiring employers to post an employee rights poster informing employees of their rights under the NLRA to unionize, among other things, violated employers’ free speech rights and was, therefore, unlawful.  National Association of Manufacturers v. National Labor Relations Board, No. 12-5068, __ F.3d __ (D.C. Cir. May 7, 2013).

We therefore conclude that the Board’s rule violates § 8(c) because it makes an employer’s failure to post the Board’s notice an unfair labor practice, and because it treats such a failure as evidence of anti-union animus in cases involving, for example, unlawfully motivated firings or refusals to hire—in other words, because it treats such a failure as evidence of an unfair labor practice.19 See Brown & Root, Inc. v. NLRB, 333 F.3d 628, 637–39 & n.7 (5th Cir. 2003).

Slip Op. at 23.  You can read the decision here.


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Second District Reverses Deputy Sheriff’s Discharge

English: Los Angeles County Sheriff helicopter...

English: Los Angeles County Sheriff helicopter in flight, Sikorsky SH-3H, N950DF (Photo credit: Wikipedia)

The Second District issued its opinion today in Shirey v. Los Angeles County Civil Service Commission (Los Angeles County Sheriff’s Department), No. B238355, __ Cal. App. 4th __ (May 6, 2013).  Plaintiff was a former deputy sheriff, who was discharged by the Los Angeles County Sheriff’s Department.  Slip Op. at 2.  Plaintiff appealed his discharge to the Civil Service Commission, which upheld the Department’s discharge decision.  Id. Plaintiff appealed, disputing whether the federal Gun Control Act of 1968, as amended in 1996 (18 U.S.C. § 921, et seq.) prohibited plaintiff from possessing a firearm because of his conviction of misdemeanor battery upon a domestic partner.  Slip Op. at 2.

The Second District reversed, finding the trial court incorrectly concluded the United States Supreme Court opinion in United States v. Hayes, 555 U.S. 415 (2009) established plaintiff‘s battery conviction qualifies as a “misdemeanor crime of domestic violence” under the Gun Control Act.  Accordingly the Commission abused its discretion in determining the federal gun possession ban applied to plaintiff.  Slip Op. at 2.

Judges & Attorneys

Judge Karlan of Los Angeles Superior Court, sitting by designation, issued the opinion for the Second District, with Acting Presiding Justice Madeleine Flier concurring.  Associate Justice Elizabeth A. Grimes dissented.

Appeal from a judgment of the Superior Court of Los Angeles County, Judge James C. Chalfant.

Ronald Talmo and Scott D. Hughes for Plaintiff and Appellant.

Hausman & Sosa, Jeffrey M. Hausman, Larry D. Stratton, and Vincent C. McGowan for Real Party in Interest and Respondent.


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Collective Bargaining Agreement’s Waiver of California Labor Code Section 227.3 Right to Vacation Pay Upon Termination Must Be Clear and Unmistakable

Take a Vacation!

Take a Vacation! (Photo credit: Wikipedia)

The Second District held today that the collective-bargaining exception to Labor Code section 227.3 requires that the right to immediate payment of vested vacation time is waived only if the CBA “clearly and unmistakably waives that right”.  Choate v. Celite Corporation, No. B239160, __ Cal. App. 4th __ (2d Dist. May 2, 2013).

The Court of Appeal, however, reversed the trial court’s ruling that defendant willfully refused to pay vacation time.  Labor Code section 203 allows for waiting time penalties of up to 30 days’ wages if an employer willfully fails to pay the employee any outstanding wages upon termination:

203. (a) If an employer willfully fails to pay, without abatement or reduction, in accordance with Sections 201, 201.3, 201.5, 202, and 205.5, any wages of an employee who is discharged or who quits, the wages of the employee shall continue as a penalty from the due date thereof at the same rate until paid or until an action therefor is commenced; but the wages shall not continue for more than 30 days. . . .

(Emphasis supplied.)  But because the present case was the first to define the standard for waiver under section 227.3, the Court found defendant did not act unreasonably.

The trial court’s ruling that Celite acted willfully was based in part on the premise that Celite’s misunderstanding of the law governing waiver—even though shared by the Union—was unreasonable. This premise necessarily assumes that section 227.3 requires any waiver to be clear and unmistakable. Although we agree with the trial court that this is the appropriate standard, this is the first case to define the standard for waiver under section 227.3. Plaintiffs argue that Saustez decided this issue, but it did not. (Saustez, supra, 31 Cal.3d 774.) Celite’s good faith reliance on a different waiver standard was accordingly reasonable, particularly in light of the language in Firestone supporting that standard. (Armenta v. Osmose, Inc. (2005) 135 Cal.App.4th 314, 325-326 [position taken where law is undecided can be reasonable].) That Celite’s position did not prevail does not mean that its position was unreasonable. (8 Cal. Code Regs., § 13520.)

You can read more here.


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