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Archive for September, 2010|Monthly archive page

Ninth Circuit Holds That Newspaper Reporters Not Exempt

In 23(b)(2) Class, Class Actions, Class Notice, Collective Action, Exemptions, FLSA, Jury, Meal and Rest Breaks, Opt-in, Opt-out, Overtime, Preemption, Professional, Trial, Unfair Competition Law on September 30, 2010 at 12:14 am
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On Monday, the U.S. Court of Appeals for the Ninth Circuit affirmed in “all respects” the trial court’s grant of partial summary judgment to plaintiffs, a judgment after jury and bench trials, and an award of attorney’s fees to plaintiffs.  Wang v. Chinese Daily News, Inc., Nos. 08-55483, 08-56740, — F.3d —-, 2010 WL 3733568 (9th Cir. Sept. 27, 2010).  Among other things, the Ninth Circuit held that plaintiff newspaper reporters were non-exempt.  (Thank you to Randy Renick for bringing this case to my attention.)

Background

Employees of Chinese Daily News, Inc. (“CDN”), a Chinese-language newspaper, filed suit against CDN on behalf of current, former, and future CDN employees based in CDN’s San Francisco and Monterey Park (Los Angeles), California locations.  Id. *1.  Plaintiffs claimed violations of the FLSA, California’s Labor Code, and California’s Unfair Competition Law, Cal. Bus. & Prof. Code § 17200, alleging that employees were made to work in excess of eight hours per day and forty hours per week. Id. Read the rest of this entry »

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Eastern District Denies “First to File” Transfer of FLSA Collective and Labor Code Class Action

In Collective Action, First to File, FLSA, Transfer on September 29, 2010 at 5:25 am
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The United States District Court for the Eastern District of California denied defendant employer’s motion to transfer pursuant to the “first-to file” rule.  Wilkie v. Gentiva Health Services, Inc., Civ. No. 10-1451 FCD/GGH, 2010 WL 3703060 (E.D. Cal. Sept. 16, 2010) (slip op.).  Plaintiff filed a putative nation-and California-wide class action/collective action against plaintiff’s former employer Gentiva for alleged violations of the Federal Labor and Standards Act (“FLSA”) and the California Labor Code § 201 et seq. for: (1) misclassification as exempt from overtime pay and failure to pay overtime; (2) willful failure to pay wages due within the time specified by the Code; (3) violation of California Wage Order No. 4 for knowingly and intentionally failing to provide timely, accurate, itemized wage statements including request for an injunction and damages; (4) failure to give proper rest and meal breaks; and (5) violation of California’s Business & Professions Code § 17200 et seq.  Id. *1

A prior FLSA collective action and New York and North Carolina state law class action against Gentiva was filed in the United States District Court for the Eastern District of New York, entitled Rindfleisch, et al. v. Gentiva Health Services, Inc., No. CV10-2111 (E.D.N.Y.) (“Rindfleisch”). Defendant moved to transfer plaintiff’s complaint under the “first-to-file rule,” on the ground plaintiff’s claims are the subject of the Rindfleisch action. Plaintiff opposed the motion, arguing the parties and claims are not substantially similar in the two actions and other equitable factors militate against transfer under the first-to-file rule.  Id. The court denied Gentiva’s motion.  Id. Read the rest of this entry »

Second District Reverses Class Action Judgment Relating to Bonuses Allegedly Due After Merger

In Attorney's Fees, Bonuses, Class Actions, Collateral Estoppel, Trial on September 28, 2010 at 10:52 pm
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The Second District reversed a trial court’s judgment in favor of employees in a class action trial.  Pearline Zalewa v. Tempo Research Corporation, B210429, 2010 WL 3735240 (Cal. Ct. App. 2d Dist. Sept. 27, 2010).  Defendant  fiber-optic equipment manufacturer was sued in a class action by its former employees who claimed that the manufacturer breached an obligation to pay them annual bonuses, an obligation that allegedly continued for years after they were laid off from work during a business downturn.  Id. The court concluded that the employees were not entitled to any recovery: “All but two of the employees relinquished their right to sue when they were laid off, in return for compensation that exceeded their earned severance pay. In any event, there was no promise made to pay bonuses to the employees after they were laid off.”  Id.

The Trial Court’s Judgment

The trial court conducted a bench trial in January 2008, finding that plaintiffs were entitled to recover a direct bonus under theories of breach of contract, promissory estoppel, accounting, and unfair business practices. Id. The court deemed the bonus payments to be “wages” under the Labor Code. Id. And because the bonus payments are wages, plaintiffs were awarded prejudgment interest and attorney fees under the Labor Code. Id. The court enumerated the amount of the award for each employee, less offsets for monies already paid by defendants, plus interest. Id. The total amount of the award, including interest, was approximately $99,000, and plaintiffs’ counsel was awarded attorney fees of $881,715.  Id. Read the rest of this entry »

Second District Reverses Summary Judgment on All Wage and Hour Claims

In Meal and Rest Breaks, Overtime, Summary Judgment on September 28, 2010 at 5:54 am
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The Court of Appeal for the Second District reversed summary judgment on wage and hour claims in Porter v. Ralphs Grocery Company, No. B218220, 2010 WL 3704055 (Cal. Ct. App. 2d Dist. Sept. 23, 2010).  Plaintiff alleged that defendant required him to work overtime off the clock, and by doing this defendant both denied plaintiff proper wages and made it difficult for plaintiff to calculate the overtime pay due him.  Id. *8.  Plaintiff also alleged that defendant failed to afford meal periods of at least one-half hour in which he was relieved of all duties, and that he regularly worked without taking the 10 minute rest breaks due him.  Id. Plaintiff alleged violation of Labor Code sections 1174, 226.7, and 512. Id. He also alleged violation of Labor Code sections 201 and 203 for failure to pay all sums due plaintiff immediately upon termination of his employment.  Id. Additionally, he alleged defendant retaliated against him for his having requested that he not have to work off the books. Id.

The Court of Appeal held that “when an employee continues to work at the end of his shift even when not requested or required to do so, and the employer knows or has reason to know about such continuing work, then the time is considered working time and it is the duty of management to see that the post-shift work is not performed if it does not want the employee to work past his shift.” Id. *9 (citing Morillion v. Royal Packing Co., 22 Cal. 4th 575 (2000)). Read the rest of this entry »

Eastern District Finds Class-Wide Arbitration Agreement Unenforceable

In Arbitration, Class-wide Arbitration on September 27, 2010 at 5:20 am
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United States District Court for the Eastern District of California rejected defendant’s argument that Stolt-Nielson preempted Gentry, and the court held that a class-wide arbitration agreement was unenforceable as against an unpaid wage and overtime plaintiff.  Mathias v. Rent-A-Center, Inc., Civ. No. S-10-1476 LKK/KJM, 2010 WL 3715059 (E.D. Cal. Sept. 15, 2010) (slip op.).

Background

Ryan Mathias (“Mathias” or “plaintiff”) was employed by Rent-A-Center, Inc. (“RAC” or “defendant”) as an Assistant Manager, a position that was classified as a non-exempt or hourly position. Id. *1. As a condition of employment, plaintiff executed an arbitration agreement (“Agreement”), which Agreement contained a class action waiver and excluded arbitration private attorney general actions.  Id. Plaintiff filed a class action alleging eight claims arising from his employment with defendant, including claims for unpaid wages and overtime, unpaid rest and meal period premiums, and penalties arising from non-compliant wage statements under the California Labor Code and California Business and Professions Code. Id. Read the rest of this entry »

Surprising Side Effect of the Minimum Wage: Finishing High School

In Minimum Wage, Wages on September 26, 2010 at 12:48 am
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The National Bureau of Economic Research report suggests a surprising effect of the minimum wage: finishing high school.  As reported by Kevin Lewis of the Boston Globe:

By curtailing low-wage/low-skill jobs, the minimum wage motivates young people to stay in school and become skilled. This effect then generates what the author calls an “educational cascade” by setting an example for the upcoming class of students. He estimates that the average male born in 1951 gained 0.2 years — and the average male born in 1986 gained 0.7 years — of high school due to the cumulative effect of the minimum wage.

Sutch, R., “The Unexpected Long-Run Impact of the Minimum Wage: An Educational Cascade,” National Bureau of Economic Research (September 2010).

By CHARLES JUNG

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Class Certification Granted in Vacation, Uniform, Paycheck, Wage and Contract Class Action

In 23(b)(3) Class, Class Actions, Contract, Paystub, Uniform, Vacation, Wages on September 24, 2010 at 2:20 pm
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The Southern District of California granted class certification in a vacation, uniform, paycheck, wage and contract class action.  Lopez v. G.A.T. Airline Ground Support, Inc., No. 09cv2268-IEG(BGS), 2010 WL 3633177 (S.D. Cal. Sept. 13, 2010) (slip op.).

Background

Former employees of Defendant G.A.T. Airline Ground Support, Inc. (“GAT”) sued for systematic wage and hour violations in violation of federal and state law. Id. *1.  GAT provides services to airlines, including ground transportation, aircraft maintenance, and cargo operations management.  Id. The four named Plaintiffs are former ramp agents employed by GAT in California.  Id. Read the rest of this entry »

First District Denies Alter Ego Liability Even Where Officer Pays Self and Wife, While Failing to Pay Wages and Commissions

In Alter Ego Liability, Attorney's Fees, Labor Code 218.5 on September 24, 2010 at 1:06 pm
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The Court of Appeal for the First District held that an officer’s failure to pay wages and commissions to an employee, while paying himself and his wife during the same period, is not the type of conduct that requires piercing the corporate veil.  Wymore v. Minto, No. A125476, 2010 WL 3687511 (Cal. Ct. App. 1st Dist. Sept. 22, 2010).

Nor do we see any merit to appellants’ various arguments that it would work an injustice to allow respondent to hide behind EWM because it was his decision, as a director and officer of EWM, not to pay appellants wages and commissions in 2007, while paying himself and his wife during the same calendar year. The fact that respondent, as the president of EWM, may have intentionally failed to pay appellants is not the type of conduct that requires piercing the corporate veil. Read the rest of this entry »

After Bench Trial on UCL Claim, Northern District Finds “On-Job Supervisor” Properly Classified as Exempt Under Administrative Exemption

In Administrative, Exemptions on September 23, 2010 at 10:20 pm
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District Judge Susan Illston of the Northern District of California conducted a bench trial of plaintiff’s overtime claim under the Unfair Competition Law (“UCL”) and found that defendant UPS met its burden of proving that plaintiff was properly classified as falling within the administrative exemption in his role as “On-Job Supervisor”.  Lopez v. United Parcel Service, Inc., C 08-05396 SI, 2010 WL 3630619 (N.D. Cal. Sept. 14, 2010).

Background

Plaintiff Ben Lopez sued defendant United Parcel Service, Inc. (“UPS”) contending that UPS improperly classified him as an employee exempt from overtime compensation under California law. Id. *1. Read the rest of this entry »

Fourth District Affirms Reduction of Fee Award to 12% of Fees Requested Under Labor Code Section 218.5

In Attorney's Fees, Lodestar on September 23, 2010 at 5:58 pm
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The Fourth District Court of Appeal affirmed a fee award of $7,475 (about 12% of requested fees) under Labor Code section 218.5, where plaintiff recovered only $3,290 in statutory waiting time penalties and the damages sought in his complaint and ultimately obtained at trial were substantially less than the jurisdictional maximum for a limited civil case.  Cochran v. El Cajon Motors, No. D055390, 2010 WL 3637540 (Cal. Ct. App. 4th Dist. Sept. 21, 2010).

Background

Defendant El Cajon Motors employed Cochran as a sales manager at its El Cajon Ford dealership until it terminated his employment in mid-January 2007. Id. *1. Read the rest of this entry »