Recent Employment Law Decisions

California Courts of Appeal

No NLRB Preemption of Supervisor’s Wrongful Termination Claim Based on Unionizing Efforts

DANG v. MARUICHI AMERICAN CORP.

“Plaintiff and appellant Khanh Dang sued his former employer, defendant and respondent Maruichi American Corporation (Maruichi), for wrongful termination in violation of public policy, claiming that Maruichi discharged him for engaging in concerted activity relating to unionizing efforts. The trial court granted summary judgment in Maruichi’s favor. The court found it lacked jurisdiction because Dang’s claim was preempted by the National Labor Relations Act (NLRA; 29 U.S.C. § 151 et seq.) under San Diego Unions v. Garmon (1959) 359 U.S. 236, 79 S.Ct. 773, 3 L.Ed.2d 775 (Garmon).

On appeal, Dang argues that, as a supervisor, he is not covered under the NLRA, and that the NLRA does not reach his claim. Based on the evidence presented on the motion for summary judgment, we find there is no basis to conclude Dang’s claim is arguably subject to the NLRA. Accordingly, we reverse.”

The decision reasoned, “Supervisors are explicitly excluded from the definition of “employee” under the NLRA and therefore are not entitled to the protections afforded by section 7. (29 U.S.C. 152(3); Operating Engineers v. Jones (1983) 460 U.S. 669, 671, fn. 1, 103 S.Ct. 1453, 75 L.Ed.2d 368.) Nevertheless, discharge of a supervisor may constitute an unfair labor practice under section 8, subdivision (a)(1), and therefore be subject to the NLRA, “if it infringes on the [section] 7 rights of the employer’s nonsupervisory employees.” (Davis, supra, 476 U.S. 380, 385, fn. 4, 106 S.Ct. 1904.)”

“ … Maruichi’s stated reason for terminating Dang’s employment—that he mistreated employees, spurring them to consider unionizing—was not arguably likely to impact its employees’ ability to engage in activity protected by section 7. … Thus, based on the evidence presented, there was no reasonable basis to find that Dang’s discharge was arguably prohibited by the NLRA, and the trial court erred by finding preemption. (Davis, supra, 476 U.S. 380, 394, 106 S.Ct. 1904 [“no dispute” that if the plaintiff was a supervisor he was legally fired “and there is no pre-emption”]; Balog v. LRJV, Inc. (1988) 204 Cal.App.3d 1295, 1302, 250 Cal.Rptr. 766 [“The Parker–Robb board specifically differentiated between the unlawful (and thus preempted) discharge of supervisors who refuse to commit unfair labor practices and the lawful (and therefore not preempted) discharge of supervisors for their participation in union or concerted activities.”].)”

Gould & Associates, Michael A. Gould, Aarin A. Zeif, Tustin, for Plaintiff and Appellant.
Cummins & White, Larry M. Arnold, Erick J. Becker, Newport Beach, Scott R. Carpenter for Defendant and Respondent.
Second District, Division 2, 9/1/2016 decision by Boren, Ashmann-Gerst and Chavez concurring; ___ Cal.Rptr.3d ___, 2016 WL 5272661.

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Legislative Update
By Mariko Yoshihara

LegUpdatePhotoGovernor Signs Several Important CELA-Backed Bills, But Vetoes Parental Leave and Arbitrator Ethics Bills

Mariko Yoshihara, CELA Legislative Counsel & Policy Director

Mariko Yoshihara, CELA Legislative Counsel & Policy Director

At the end of last month, CELA sent a handful of priority bills to the Governor for approval and weighed in with strong support on several key bills that were led by our labor allies. We saw some great victories early on, including expanded sexual harassment and wage-theft protections for janitorial workers (AB 1978), and stronger overtime protections for domestic workers (SB 1015) and for farm workers (AB 1066). Governor Brown had until September 30th to sign or veto all bills on his desk, so by now he has acted upon all bills. For us, that means that all but two of our key bills were signed, including legislation to limit choice-of-law and choice-of-venue clauses (SB 1241) and legislation to strengthen the Equal Pay Act (AB 1676 and SB 1063). Unfortunately, however, our bill to expand job-protected parental leave to more California workers (SB 654) and our bill to strengthen arbitrator ethics (SB 1078) were vetoed, both of them for dubious reasons noted in the Governor’s veto message.

See below for more details on this year’s most noteworthy bills that made it to the Governor’s desk. CELA’s sponsored and priority bills of 2016 are marked by *asterisks*. For a full list of bills we tracked this year, visit www.cela.org/legislation.

We now are putting together our bill package for next year. If you have a bill idea, would like to get involved in CELA’s Legislative Committee, or have a client or non-client with an experience that might help to advance our legislative efforts, please email mariko@cela.org.

*Choice-of-Law and Choice-of-Venue Clauses*: SB 1241 (Wieckowski) will prohibit an employer from requiring an employee who primarily resides and works in California to agree, as a condition of employment, to a provision that would require the employee to adjudicate outside of California a claim arising in California or would deprive the employee of the substantive protection of California law with respect to a controversy arising in California. The bill will make any provision of a contract that violates these prohibitions voidable upon request of the employee and will require a dispute over a voided provision to be adjudicated in California under California law. The bill will except from these provisions a contract with an employee who was represented by

legal counsel, as specified. Status: Signed on September 25th, 2016!

*Arbitrator Ethics and Repeat Players*: SB 1078 (Jackson) would have prohibited an arbitrator from taking new cases from a party or a lawyer for a party during the pendency of an arbitration. This bill also would have required disclosure of solicitations by arbitration service providers and would have prohibited solicitations of a party or a lawyer for a party during the pendency of the arbitration. Status: Vetoed with the following message: “Arbitrators in California are already subject to stringent disclosure requirements under existing state law and Judicial Council standards. I am reluctant to add additional disclosure rules and further prohibitions without evidence of a problem. Further, the existing Judicial Council procedure for amending arbitrator ethics standards is a deliberative and public process that can more appropriately consider additional requirements.”

*Expanding Parental Leave to Cover More Workers*: SB 654 (Jackson) This bill would have extended 6 weeks of job-protected bonding leave to California workers at companies with at least 20 employees within 75 miles of the employee’s worksite. Status: Vetoed with the following message: “It goes without saying that allowing new parents to bond with a child is very important and the state has a number of paid and unpaid benefit programs to provide for that leave. I am concerned, however, about the impact of this leave particularly on small businesses and the potential liability that could result. As I understand, an amendment was offered that would allow an employee and employer to pursue mediation prior to a lawsuit being brought. I believe this is a viable option that should be explored by the author.”

Farm Worker Overtime: AB 1066 (Gonzalez) phases out the agricultural worker exemption from California’s overtime requirements for work exceeding 8 hours in a single day by decreasing the current 10-hour overtime threshold in 30-minute annual steps over the next four years. It also removes the current Labor Code exemption for agricultural employees regarding hours, meal breaks, and other working conditions, including specified wage requirements. Status: Signed on September 12th, 2016!

Celebrating overtime victory with the Domestic Workers Coalition!

Celebrating overtime victory with the Domestic Workers Coalition!

Domestic Worker Overtime: SB 1015 (Leyva) deletes the January 1, 2017 repeal date on the provisions under the Domestic Worker Bill of Rights that require payment of overtime compensation for domestic workers after 9 hours in one day or after 45 hours a week, thereby making the requirement permanent. Status: Signed on September 12th, 2016!

Protecting Janitorial Workers from Sexual Assault: AB 1978 (Gonzalez) establishes various requirements for the janitorial industry, including a registration requirement and added protections against workplace sexual violence and harassment. Status: Signed on September 15th, 2016!

Immigrant Employee Rights: SB 1001 (Mitchell) protects immigrant workers by prohibiting employers from requesting specific documentation not required by the I-9 form or refusing to accept legally acceptable documents at the time of hiring – a discriminatory practice known as “document abuse.” Status: Signed on September 28th, 2016!

*Expanding the Equal Pay Act*: SB 1063 (Hall) amends the Equal Pay Act to include race and ethnicity, thereby prohibiting an employer from paying any of its employees at wage rates less than the rates paid to employees of another race and ethnicity for substantially similar work. Status: Signed on September 30th, 2016!

*Prior Salary and the Wage Gap*: AB 1676 (Campos) amends the Equal Pay Act to clarify that an employee’s prior salary cannot be the basis for any disparity in compensation when compared to a co-worker of the opposite sex who is doing substantially similar work. Status: Signed on September 30th, 2016!

Minimum Wage: SB 3 (Leno) increases the state minimum wage incrementally to $15 per hour by 2022 or, for businesses with 25 employees or less, by 2023. Further, beginning July 1, 2018, it entitles providers of in-home supportive services to up to 3 days of paid sick leave. It also provides for two potential “off-ramps” whereby the Governor can temporarily suspend a scheduled increase based on depressed economic conditions. Status: Signed on April 4th, 2016!

*Increasing Paid Family Leave Benefits*: AB 908 (Gomez) increases the wage replacement rate under California’s Paid Family Leave Program from 55% to 70% for those who make up to 33% of the California average weekly wage or 60% for those who make more than 33% of the California average weekly wage. The bill also eliminates the one-week waiting period for PFL claims. Status: Signed on April 11th, 2016!

Ban the Box: AB 1843 (Mark Stone) prohibits an employer from asking an applicant for employment to disclose information concerning juvenile criminal records and from using that information as a factor in determining any condition of employment. Status: Signed on September 27th, 2016!

Victims of Domestic Violence: AB 2337 (Burke) requires employers to inform each employee in writing and upon request regarding existing employment protections for victims of domestic violence, sexual assault, or stalking. Status: Signed on September 14th, 2016!

PAGA Oversight: SB 836 (Committee on Budget and Fiscal Review), which became effective on June 27, 2016, made the following changes to PAGA. Except as otherwise noted, these requirements apply prospectively to all pending PAGA cases as well as new filings:

  • All new PAGA claim notices must be filed online, with a copy sent by certified mail to the employer.
  • All employer cure notices or other responses to a PAGA claim must be filed online, with a copy sent by certified mail to the aggrieved employee or the aggrieved employee’s representative.
  • A filing fee of $75 is required for a new PAGA claim notice and any initial employer response [cure or other response] to a new PAGA claim notice.
  • The filing fee may be waived if the party on whose behalf the notice or response is filed is entitled to in forma pauperis status.
  • The time for the Labor and Workforce Development Agency (LWDA) to review a notice under Labor Code § 2699.3(a) has been extended from 30 to 60 days.
  • When filing a new PAGA lawsuit in court, a filed-stamped copy of the complaint must be provided to the LWDA. (This applies only to cases in which the initial PAGA claim notice was filed on or after July 1, 2016.)
  • Any settlement of a PAGA action must be approved by the court, whether or not the settlement includes an award of PAGA penalties.
  • A copy of a proposed settlement must be provided to the LWDA at the same time that it is submitted to the court.
  • A copy of the court’s judgment and any other order that awards or denies PAGA penalties must be provided to the LWDA.
  • All items that are required to be provided to the LWDA must be submitted online. All PAGA-related notices and documents are no longer required to be submitted to the LWDA by certified mail.

Once again, we now are putting together our bill package for next year. If you have a bill idea, would like to get involved in CELA’s Legislative Committee, or have a client or non-client with an experience that might help to advance our legislative efforts, please email mariko@cela.org.

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