WELCOME TO A NEWS BRIEFING OF SELECT NATIONAL AND CALIFORNIA EMPLOYMENT LAW DEVELOPMENTS AS THEY ARE HAPPENING.
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Fri. Oct 21, 2016
Frank Pray, Employee Rights Attorney Attends OCBA Volunteer Recognition.
Volunteer members of the Orange County Bar Association were honored by the Bar this week with a reception. I and many others were invited to wine and dine without charge at a very nice new restaurant/bar not far from my office. Those attending were recognized as contributors to a civic or professional purpose to advance the profession or social good Most honored was my friend and colleague Roy Comer who has been a consistent giver of talent and knowledge in the “Bridging the Gap” program to assist new lawyers understand the local courts and the “bread and butter” skills of success in the law. Roy is also active in other organizations in which we both belong: Daniel’s Inn, and the OCBA Solo Practitioners’ Section.
Thur. Sep 22, 2016
Frank Pray, Employee Rights Attorney to Attend the 89th annual State Bar Convention.
I will be in San Diego October 1, 2016 for a day of continuing education conferences covering trial strategy and tactics. I’ll also be getting updates on legal developments in the PAGA statutes and cases. A nice part of the deal: a free 2016 membership in the State Bar Labor and Employment Law Section.
Thur. Sep 22, 2016
The Ninth of the Nine Lives of the Now Skinned Iskanian Cat. FINAL UPDATE.
It’s over at last. The trial court Iskanian case was dismissed by Judge Hess, L.A. Superior Court. The Iskanian dismissal was entered over the protests of his abandoned and bewildered counsel. This leaves open the shadow presence of secret inquiries by defense agents to PAGA representated clients: Let us pay you off confidentially for much more than you can ever get by being the lead Plaintiff [“Private Attorney General”] in the PAGA case. It remains to be seen if this tactic, if it occurs, and if it can be proven, will be nullified by a Court.
But the wreckage left behind by years of appeals is not without redeeming outcomes for employees. A lesson learned for all PAGA cases is to have a back-up. That is, at the time of or after the filing, find at least 2 or more persons ready to act as representatives. Judge Hess’s ruling that the PAGA case is to be put on hold pending arbitration of individual claims was case limited, i.e., is not precedent, and the fight can continue to require the PAGA case to proceed, and the arbitration case to be suspended, pending the PAGA determination. Other courts may see the arbitration gambit by the Defendant for what it is: a delaying tactic it hopes will lead to the disappearance of the PAGA representative.
What now? Iskanian also left another wreckage: The Ninth Circuit in Sakkab v. Luxxotica Retail North America, 2015 DJDAR 10850 ruled some years ago that PAGA cases were not subject to arbitration. The Ninth Circuit followed the reasoning of the California Supreme Court in Iskanian: The FAA did not require arbitration of PAGA cases because the case reverts to the benefit of the State of California. This issue is likely to reach the U.S. Supreme Court.
The related issue of FAA preemption of Section 7 of the NLRA is also likely to reach the U.S. Supreme Court due to a split in the Circuits. In Morris v. Ernst & Young LLP, 2016 DJDAR 8732 (Aug. 22, 2016). The Ninth Circuit held that the NLRA, Section 7, as interpreted by the NLRB, is a substantive right of “concerted action,” that cannot be deprived by a class action waiver agreement signed by individual employees. The Seventh Circuit and Ninth Circuit are lined up against several other Circuit Courts holding just the contrary. A U.S. Supreme Court show-down is inevitable.
In the meantime, there is this anomaly: Plaintiffs’ class action waiver employment agreements [Morris] will be invalidated in the Ninth Circuit, but upheld by California Superior Courts [Iskanian.]
Fri. Jun 24, 2016
More Ways Than One to Iskanian a Cat. UPDATE #5
Los Angeles Superior Court Judge Hess June 22, 2016 dismissed the decades old Iskanian case. I suppose the logic resides in the body of Iskanian himself. No body loves the State of California. Or maybe the it is that the State of California is disembodied and therefore dismissed. I personally never thought of the Plainitff-Employee as the “Private Attorney General” but as the client of the “Private Attorney General.” As in class actions, the body can be one of several, perhaps one of millions. The real issue is whether the body brought into court has interests and injuries typical of the class. The attorneys representing Iskanian were, in my logic, but not the Court’s, the “private attorney general” and they presented a new somebody to love. But Judge Iskanian ruled this alternative body is not the Iskanian Cat. Or, to continue a theme of these updates: Judge Hess has held there is only one way to Iskanian a Cat after all.
Are these Iskanian updates at an end? Time is money, and a decade is a lot of money. Who will fund the next round of appeals? I believe Judge Hess missed the mark on this one, but respect that he saw the case microscopically, while in my bias, I may be seeing it myopically. But a 10 year old Iskanian-less cat may not have the stamina for another climb up the appellate tree. Still, I want my feelings [felines?] to be vindicated, and hope that someone else [but who if there is nobody?] will run that cat up the tree one more time.
Tues. Jun 21, 2016
More Ways Than One to Iskanian a Cat. UPDATE #4
The hairless Iskanian cat now also appears gutless, or more accurately – eviscerated by Iskanian himself. You’ll find some breadcrumbs on this page tracing the Iskanian “updates” 1 through 3. This fourth update is presented in our blog article, entitled: “PAGA Dismissals: Iskanian Bit Off a Duty. Now, Can it Spit It Out?” Iskanian-4 Blog Article. After nearly a decade of this “Private Attorney General” taking his case up and down the appellate hierarchy, it seems to have crashed in Judge Hess’s courtroom when Iskanian himself chose to disappear, suddenly, without warning, and without a hint to his attorneys. Did he get picked off or just ticked off? We may need to wait for Iskanian Update #5 to find out.
Mon. Apr. 25, 2016
Employee Rights Attorney Frank Pray Speaks Before Two Groups of Attorneys on Subjects of Ethics and Bias.
This month, I delivered a presentation on the newly enacted California Fair Pay Act to approximately 100 attorneys attending a monthly meeting of the Orange County Bar Association Labor and Employment Law Section.The presentation will be for “Minimum Continuing Legal Education” for State Bar credit on the subject of “Elimination of Bias in the Legal Profession.”
Also this month, I will be one of several attorneys presenting “skits” demonstrating teachable situations on the general state of civility in the practice of law. County Bar President Todd Friedland has made this concern the center piece of his presidency. He will be introducing the topic, and participating in one of the skits. The presentation will be for “Minimum Continuing Legal Education” for State Bar credit on the subject of “Ethics in the Legal Profession.” This presentation will be before the William P. Gray Inn of Court, a member organization of the American Inns of Court. The purpose of the Inns is to raise and preserve the highest standards for the practice of law.
The subject of gender bias and “fair pay” has triggered a passion in my office for our team to provide more opportunities for the public to understand how gender bias operates based on the hard data demonstrating entrenched and substantial pay disparities.
Mon. Dec. 14, 2015
More Ways Than One to Iskanian a Cat. UPDATE #3
See Updates 2 and 3, below. Judge Hess ruled that the non-PAGA individual claims are to be arbitrated first. The Judge’s ruling that is not binding precedent in other cases, but will be used as negotiation leverage “off the record” as like issues arise.
Governor Brown Appoints Three To Orange County Superior Court
The following article is lifted verbatim from the OCBA website [OCBAR.ORG]:
On Tuesday, Nov. 17, 2015, Governor Edmund G. Brown Jr. announced the appointment ofFrank Ospino, Kathleen E. Roberts, and Mary Kreber Varipapa to judgeships in the Orange County Superior Court.
Ospino, 55, of Santa Ana, has served as the Orange County Public Defender since 2012 and has served in several positions at the Orange County Public Defender’s Office since 1992. Ospino fills the vacancy created by the retirement of Judge Luis A. Rodriguez. He is a Democrat.
Roberts, 50, of Glendale, has served as a deputy district attorney at the Orange County District Attorney’s Office since 1993. She was an attorney at McClintock, Weston et al. from 1991 to 1993 and at Latham and Watkins from 1990 to 1991. She fills the vacancy created by the retirement of Judge Francisco P. Briseno. Roberts is a Democrat.
Kreber Varipapa, 47, of Seal Beach, has served as an attorney in the Orange County Public Defender’s Office since 1998. She was an adjunct professor at the University of Phoenix Criminology Department from 2004 to 2007 and an attorney at Orange County Juvenile Defenders from 1996 to 1998 and at Santa Clara Juvenile Defenders from 1996 to 1997. She fills the vacancy created by the retirement of Judge Ronald P. Kreber. Kreber Varipapa is registered without party preference.
For more information, please click here.
Mon. Nov. 16, 2015
More Ways Than One to Iskanian a Cat. UPDATE #2.
I earlier covered a pivotal legal development for the employment law community. See The Iskanian Cat and the Nov. 5, 2015 News Article immediately preceding this article.
“Case sequencing” is the phrase that the Daily Journal has adopted to described the ongoing question: does the PAGA case [a representative case for numerous employees, similar to a class action] proceed to trial in Superior Court before an Arbitration of the individual representative’s claims for wages and Labor Code violations?
Judge Robert Hess of the Los Angeles Superior Court still has not decided that issue, but indicated he felt that the employer-defendant would be deprived of the benefit of its contract to arbitrate if the PAGA case proceeded first. He indicated his decision will be issued next week.
The argument, posed by the defense, is that if the individual plaintiff loses at the arbitration stage, it is evidence that he is not qualified representative of the employee group. The defense, the employer argues, should have that threshold matter decided first.
The Iskanian case was returned to Judge Hess by the California Supreme Court when it held that the PAGA claim did not have to be arbitrated as it was derivative of the right of the State of California to sue on behalf of employees, a right delegated to private attorney generals, i.e., plaintiffs’ attorneys.
What This Means:
The trial court’s ruling will not be precedent unless it is appealed and the subject of a published opinion of the Court of Appeal. However, of course the employer community will consider the trial court’s ruling a victory, and it will put the burden of persuasion on the Plaintiff to appeal.
But a realistic balance is needed: an individual’s very limited wage and meal break violation damages is the “tail” of the case, while the collective rights of the represented group are the “dog.” Let us hope the employer community is not able to use smoke and mirrors to wag the dog.
As I’ve stated in earlier articles on the Iskanian dilemma, the defense driver is not the opportunity for early and efficient resolution of an individual Labor Code claim, but an indirect attack on the PAGA case by delay and division. One tactic is to satisfy by a generous settlement or frustrate the individual by cost and delay to the extent he or she no longer has the desire or fortitude to continue as a representative.
Frid. Nov. 5, 2015:
More Ways Than One to Iskanian a Cat. UPDATE
I earlier covered a pivotal legal development for the employment law community. See The Iskanian Cat. The question arises when a civil action includes both individual claims subject to arbitration and a “PAGA” claim not subject to arbitration. The unsettled question is which part of the case is to be tried first: the arbitration or the PAGA case? But this superficial question belies the deeper tactical considerations: why does it matter?
When looking into the unspoken tactical considerations driving the technical arguments, it becomes clear the employer community wants to delay the timeline on the PAGA case because a threat deferred may be a threat avoided. That is, forcing the individual PAGA representative into early arbitration of his separate claims gives the defense time a) to poke holes in the pending PAGA case; b) obtain potential arbitrator rulings that can be “collateral estoppel” in the PAGA trial, and c) potentially satisfy the individual defendant with an arbitration award or settlement, leaving the PAGA case with no named representative, and / or d) wear down the Plaintiff and his counsel with additional costs and effort. Of course, as in all tactical decisions, this ploy can backfire on the if the employee wins at the arbitration level, and is more determined than ever to continue the PAGA case.
Favorable to the Plaintiff-employee currently: Sakkab v. Luxxotica Retail North America, 2015 DJDAR 10850 — A September 2014 Ninth Circuit decision holding that the PAGA case is to be given priority in being tried. Unfavorable to the Plaintiff-employee: The FAA (Federal Arbitration Act) which may ultimately be decided by the U.S. Supreme Court as applicable to PAGA cases.
Currently, Judge Robert L. Hess, L.A. Superior Court, has this “timing and priority” question under review, the matter having been argued before him on Nov. 2, 2015 after remand by the CA Supreme Court holding that PAGA cases are not pre-empted by the FAA.
What This Means: The federalism and pre-emption battles continue. Eventually, the U.S.S.Ct. will have to decide the ultimate issue of whether PAGA is a claim belonging to the State of California, or if PAGA is a pseudonym for a class action. If PAGA is deemed subject to arbitration, it will mean employers will take the next step: just as the class action procedure may be waived by individual employees, so may a PAGA representative claim. This outcome will essentially eviscerate California’s intended enforcement mechanism for employee Labor Code rights.
Sat. Oct. 24, 2015:
Female Workers Earn Less than Male Colleagues
We’ve heard this bad news before. What’s new then? It’s that the news stays bad despite the federal equal pay laws. The Wall Street Journal reports that the latest economic comparison shows a “widening gap” in the female / male pay scales. This data within the big picture shows that the gains and losses from year to year overall do not point toward significant progress in reaching gender pay parity. Gender Pay Disparity WSJ. The Journal notes that men’s pay increases are twice as great as those for women in the same occupations.
California recently enacted some major changes to its existing Equal Pay Act. The new California standard is equal pay for “substantially similar work” rather than “equal work.” You may think this is a “spit the hair” difference, but it closes a loophole employers could use to justify gender-rooted differences in compensation.
What This Means: California has added muscle to its Equal Pay Act, and the data indicates its still needed. The Act permits recovery of attorney’s fees on prevailing in Court. These cases will now be more attractive for litigation. Historically, few of these types of cases have been tried, and it is apparent the California legislature understood the problem.
Wed. Oct. 14, 2015:
Law Firm Executives on Trial
The biggest law firm collapse in history: Dewey & LeBoeuf, LLP, New York City, 2012, bankruptcy. Fast forward: 2015 – a prosecution of three executives in the Dewey & LeBoeuf firm who allegedly committed fraud upon investors with statements of the firm’s financial condition. Charged were the executive director, the chief financial officer, and chairman of the defunct firm. After 4 months of trial in Manhattan, and 18 days of deliberation to date, and mountains of financial documents and emails, the jury is struggling to reach a unanimous verdict. The threat now is a mistrial, as jurors have reached an impasse. The losers: the banks and investors who kept the firm afloat based on false financial data.
What This Means: The law firm name, Dewey & LeBoeuf, LLP, in its immense shining silver glory on the face of a Manhattan high rise conveyed prosperity, power, expertise, and quality. What it delivered was financial loss for itself and its investors/lenders. Business fails. There is no shame in that, especially if the entrepreneurs take an honest, calculated risk. If there is shame here, it will be exposed by a verdict of guilt, but that appears very unlikely now. This is a criminal prosecution with a very high burden of proof. “Not guilty” is different than “innocent.” The real loss is not just to the financial community, but to the profession of law, whose image is tarnished along with those immense silver letters.
Friday. Oct. 9, 2015:
Executive Pay Disparity: Not all Payday Candy Bars Are the Same Size
Remember those Payday Candy Bars. Yummy, with a nice core of something like thick honey, then salty peanuts, and finally a coat of chocolate? You work all week. You deserve a Payday. Stretch the candy bar image a little farther, well A LOT farther: Exhibit A: Your standard sized employee candy bar, and next to it, Exhibit B: the CEO’s candy bar – 50 times larger than yours. How can one CEO consume so much? Or more fundamentally, is this disparity something like the fiefdoms of old – when title meant everything? For one writer’s assessment of how this excess executive pay hurts the social order, see: Excess Executive Pay.
The SEC finally issued its final pay ratio disclosure rule. See SEC Final Rule Release No. 33-9877. A registrant (i.e., a company with publicly traded stock) is required to disclose the median of the annual total compensation of all its employees – excluding the “principal executive officer” – usually the CEO. Why the exclusion. So us little payday people can compare our candy bar to his or hers. And the 50:1 ratio example above – not that farfetched. To the contrary, likely a bit understated.
The disclosure filing must be no later than 120 days after the end of the company’s fiscal year. The Rule kicks in for the first fiscal year beginning on or after January 1, 2017.
What This Means: It means something to employees and investors alike: CEO’s manipulating their own salaries in gargantuan amounts many times greater than the median implies (but does not prove) that the CEO may be self-serving, and more interested in personal short term gain than corporate long term growth. It may also mean that the CEO views employees as underlings created to inflate short term quarterly results to increase CEO bonuses, even if long term growth and employee morale are put at risk. In the end, the disclosure is nothing more than that: information that can be used to make decisions.
Thur. Oct. 1, 2015: The Staining of the Golden Arches: MacDonald’s May Have to Pay Franchise Employees.
A Novel Theory Keeps Class Action Case Alive.
Franchise Owners of five MacDonald’s Restaurants in Northern California were sued for failure to pay overtime to their employees. The employees also sued MacDonald’s as the franchisor on several theories that MacDonald’s was a “joint employer” with the franchisees. This week, a federal judge threw all the theories but one: that the owner/operator was an “ostensible agent” for MacDonald’s. Definition of “Ostensible Agent.” The theory is common law, but also, in this case, is grounded in a little used California Industrial Welfare Commission wage order. The Court held that this theory could be allowed to proceed to trial, thereby keeping the class action alive. Ochoa v. McDonald’s Corp, CV14-02098 (N.D. Cal., filed May 27, 2014). This “joint employer” theory is gaining momentum with the courts, as well as the federal National Labor Relations Board [NLRB] which currently is reviewing 13 similar but individual complaints against McDonald’s.
What This Means: The individual class action plaintiffs in this case move on toward trial. There will be a likely settlement by MacDonald’s to avoid a precedent. But if there is no settlement, then there will most certainly be an appeal to the Ninth Circuit Court of Appeals. For the public at large, it means that the franchise model will be rocked at its foundation if the cost to the franchisor increases for the illegal actions of its “ostensible agent,” the franchisee. The good news would be that the franchisor would then be incentivized to exert more direct control to require compliance with the California and Federal wage laws.
Tue. Sept. 29, 2015: An Unsteady Victory For Employees Fighting Arbitration
Good News for California Employees
On September 28, 2015, a federal court, the Ninth Circuit Court of Appeals, ruled in favor of the Plaintiff (the employees, and indirectly, the State of California) that the group cases could not be forced into arbitration. The employer had argued that the “Federal Arbitration Act” required arbitration if the parties agree to arbitration in a written contract. The Ninth Circuit ruled that there was something unique about “Private Attorney General Act” [PAGA] cases: that they were for the benefit State of California, and that the State was not a party to the Arbitration Agreement. A PAGA case in effect designates the employees’ attorney as a “bounty hunter” to go after cheating employers. If the attorney brings back the body, the employees and the State of California split the reward, and the attorney is paid by the employer. The case decided by the Ninth Circuit is Sakkab v. Luxxotica Retail North America, 2015 DJDAR 10850. This is the case almost certainly to go to the Supreme Court.
What This Means: Large scale group cases, closely resembling “class actions” will continue to be prosecuted by private attorneys in California, for now. This decision sets up the case for the U.S. Supreme Court. Until then, California law remains a strong incentive for employers to evaluate their pay practices and general compliance with penalty statutes of the Labor Code.
Mon. Sept. 21, 2015: Retired Jurist Continues to Resolve Conflicts.
Hon. Nancy Weiben Stock (ret.) shifting focus as a JAMS mediator.
One of Orange County’s most distinguished jurists is now retired and for the last 19 months has worked as a private mediator for the Judicial Arbitration and Mediation Service. She mediates complex cases, business disputes and family law issues. She also referees discovery disputes.
I recently reviewed an interview with her by the Los Angeles Daily Journal. [Fri. Sept. 8, 2015] She was a federal prosecutor for nine years, and the presiding judge of the Orange County Superior Court from 2006 through 2009. She sat on the “Complex panel” of the Court for 4 years. [The Complex panel handles multi-party litigation with unique administrative demands – including construction defect litigation and class actions].
The article described her as framing her speech thoughtfully and carefully, and being a bit formalistic. Of course, that is exactly what judges are required to do, and as a mediator, she is “letting her hair down” according to the article.
But I have been in several social situations with Judge Stock, and had a chance to observe how she connects to people. Coupled with that cool methodical mind is a truly warm heart that shows genuine interest in people of all walks of life. She is a gracious, loving, and warm human being. I still recall several years ago during a social event how she gave my legal assistant total eye contact and attention. For that few minutes, my assistant was the most important person in the room.
What This Means: Judge Weiben Stock is a problem solver, a critical role for lawyers in a complex society generating conflict. The idea that conflicts can be resolved with more than the “win-lose” of litigation is essential for people to be able to go forward efficiently with their businesses and personal lives. As Judge Weiben Stock is reported to say at the beginning of each mediation: “Today will reveal choices that were not available before.” I love that statement, not just as a mediation tool, but as an attitude for beginning each new day.
Thurs. Sept. 17, 2015: Gender Discrimination at Microsoft is Challenged
Post-Pao, Another Champion Arises. Another woman has sued a major corporation for gender discrimination in promotion and pay. Katherine Moussouris worked for Microsoft-Trustworthy Consulting Group as a security program manager. She alleges the tiered system for promotion was staked against her and other women seeking the highest levels of responsibility and pay.
She alleges that the performance rating system eliminated 80% of the applicants for promotion, and that the actual rankings are manipulated to exclude women. She alleges a cabal of senior executives in an inner circle who decide who is promoted based on gender bias.
Included in the complaint is an allegation of retaliation because Moussouris complained that her new Director sexually harassed other women in the group.
Moussouris v. Microsoft Corporation 15-CV1483 W.D. Wash., filed 9-16-2015.
What This Means: The spirit of Pao lives, and all women who have sacrificed long hours, and spent years building their careers, are saying with suits like these that they demand transparency and fairness without regard to gender bias. It will be interesting to see if Microsoft has the capacity to self-examine, and make the necessary corrections in hiring, training, mentoring and advancing women equally with men.
Mon. Sept. 14, 2015: Pervasive Sexual Harassment at Call Center
Sexual Harassment Wake-Up Call For Call Center: The EEOC has obtained a $600,000.00 settlement for a group of employees at a call center who were sexually harassed by their female supervisors, including being groped and subjected to lap dances. “Employers must take more proactive steps to address complaints of sexual harassment,” Anna Y. Park, regional attorney for EEOC’s Los Angeles District, said in a statement. “It is also illegal under federal law to retaliate against employees who exercise their right to report harassment or discrimination.” L.A. Times News Report. Global VXI was hit with the settlement and consent decree because of complaints unaddressed and dating from 2009 for harassment by both men and women supervisors. The consent decree requires data tracking of any further complaints and any post-complaint retaliation.
What This Means: Why does a company have to be ordered to set in place mechanisms of training and enforcement to prevent sexual harassment? Not caring about employees is costly in morale and productivity. As this case illustrates, failure to implement an anti-harassment policy can be legally expensive as well. Global VXI is at last paying the bill. A Company wishing to avoid liability and increase employee job satisfaction and productivity might do what Global is now doing: training, monitoring, protecting and enforcing.
Sun. Sept 13, 2015: Equal Pay Act in California Toughened
A Blow for Gender Equality: Governor Jerry Brown is likely to sign into law a far reaching Equal Pay Act that has passed the California Legislature. The California Fair Pay Act, Senate Bill 358, extends the statutes that have been on the books since 1949 in one form or another.
The problem with enforcing equal pay statutes has been proving a high level of similarity between male and female job titles and responsibilities. The high standard for proof of “equal work” has dampened enthusiasm for the law as a major corrective tool of gender pay inequality.
The new law will add protections to employees who discuss pay at work, and will remove a requirement of previous law that the employees work at the same location. The law will shift the burden to employers to prove that pay differences are due to job-related differences rather than gender. The law also allows an unequal pay case to go forward even when the two positions have different titles. The female worker will still have to prove the two positions compared are indeed substantially similar the scope of responsibility and skill required.
What This Means: The law may be useful in a critical component of ending gender based disparity: exposing the pay rates for men. This law will allow a woman a greater chance of discovering the pay gap as she is allowed to speak freely with other employees about earnings, without protection from retaliation. These cases often proceed because of a woman’s surprising discovery that she is paid perhaps tens of thousands of dollars less per year than her male co-worker performing the same job.
Wed. Sept. 2, 2015: Discrimination Cases For California State University Employees Denied Tenure Take a “SLAPP” in the Face.
Getting “SLAPPED” Around: A California trial court denied an anti-SLAPP motion by Cal State University. The motion claimed that a tenure review process was a public proceeding, and the information exchanged in the proceeding was constitutionally protected free speech. The professor denied tenure claimed the denial of tenure was the result of [i.e., arose out of] discrimination base on his national origin. In Sungho Park v. Board of Trustees of the California State University [Aug. 27, 2015], the Second Appellate District, Div. 4, in a 2-3 decision held that the anti-SLAPP statute applied. The Court reasoned that the statute makes no exception for the motive of the denial of tenure, and concerns itself only wit the action taken by the employer, and the communications arising out of those actions. Inasmuch as the Plaintiff’s claim of discrimination concerned itself only with motives, that is, the motive to discriminate. The peer review process is an “official governmental proceeding” for the state University system. The peer review communications during the process were “protected activities.” If the decision to deny tenure arose out of the tenure review communications, the anti-SLAPP provisions would apply. The Court found, and the parties apparently agreed, that the communications in issue were all within the tenure review process.
What This Means: Universities conducting peer review for tenure will have access to anti-SLAPP statutes to claim free speech rights for the University. A professor denied tenure must present evidence at the anti-SLAPP hearing that it is more likely than not that discrimination was behind the denial of tenure. All this decision held was that the Anti-SLAPP law applies. It did not decide if the University would ultimately be successful in using it as a defense.
Tues. Sept. 1, 2015: Compelled Employment Arbitration Agreements Attacked by CA Legislature
Don’t Tread on Us. The California Legislature this week (August 24, 2015) snubbed the U.S. Supreme Court, doing what the California Supreme Court backed down to do in Sanchez v. Valencia Holding Co. Full Opinion – Sanchez Case. Specifically, the legislature enacted AB 465 that declares an arbitration agreement invalid if it is tendered as a condition of employment. The statute puts the burden on the employer to prove the arbitration agreement is voluntary and without making signing a condition of employment. The waiver of trial rights must be in writing. As of this writing, the question is whether the Governor will sign the bill. Most legal experts feel the legislation is unconstitutional because unduly obstructive of the Federal Arbitration Act that liberally allows arbitration with few or no requirements of fairness. The statute appears to shift the burden of proof to the employer to demonstrate that the arbitration agreement is without duress, coercion, or basic unfairness. The kicker for the employee: the employee recovers attorney’s fees if successful in resisting enforcement of the contract.
What this Means: If signed into law, the statute will cause employers will scramble to comply in California, even an inevitable test case makes its way to the California, and possibly the U.S. Supreme Court. Employees will have a respite of short duration from being compelled into arbitration. While I personally think this is a good law, and a matter of the State having the sovereign right by common law to set the operative principles of contract law, the trend of federal decisions, including the U.S. Supreme Court, is to the contrary.
Fri. Aug. 28, 2015: NLRB FINDS EMPLOYERS CAN’T SHIFT LIABILITY TO STAFFING AGENCIES.
It’s the new economy: Cut costs by moving employee staffing, human resource and benefit functions to a staffing or “placement” agency. It’s also a convenient way for the “employer” not to be the “employer.” When employees want to unionize or when an employee wants to sue the “employer,” the “employer” defends itself by pointing to the staffing agency: “They’re the employer, not us.” The NLRB has ruled that if the “employer” has any degree of control over the operations or functions of the staffing agency employees [Such as deciding when to arrive at work], the “employer” is also responsible for following the laws protecting employees.
What this Means: More lawsuits claiming “dual employment” and more access to “deep pockets” to satisfy settlements and judgments — but this is an NLRB decision, and only goes so far — other agencies and courts will separately decide to follow the NLRB reasoning or not.
Mon. Aug. 24, 2015: The Entertainment Big Boys Fail to Crush Employee Class Action at Early Stage for Violation of Antitrust laws in Fixing Compensation by Conspiracy.
The players and the allegations: Sony Pictures, Pixar, Walt Disney Company, Lucas Films, and Blue Sky Studios ganged up on a group of employees to seek early dismissal of the employees’ complaint for Anti-Trust violations. Good news for the employees: The District Court ruled against the Entertainment Giants, holding the employees had sufficiently alleged specific facts necessary to show a plausible case for active conspiracy to hide an “anti-employee poaching” agreement and a related agreement to contain wage bidding wars for highly talented and experienced workers. Read the Court’s Order Denying the Studios’ Motion To Dismiss.
What this Means: First, the order will allow the employees to go forward with their case for anti-trust civil damages and injunctive relief. Hopefully, the employee attorneys will obtain an enforceable, monitored agreement not to continue the deceptive wage fixing practices. Economically, it means that in the supply demand of labor talent, the talent will be able to enjoy greater freedom to bargain for market level wages.