Employment Law

New Law Protects Losing Employees in Wage and Hour Cases From Paying Attorneys’ Fees

As of January 1, 2014, a new law (SB 462) makes it more difficult for prevailing employers in wage and hour cases to collect attorneys’ fees and costs against their employees.

Prior to the new law, Labor Code §218.5 required courts in wage and hour cases to award the prevailing party attorneys’ fees and costs. Under the new law, however, a prevailing employer will only be awarded attorneys’ fees and costs if it can convince the court that the employee brought the action in bad faith. Bad faith is a difficult standard to prove, so the new law will likely result in few employers recovering attorneys’ fees from their employees in wage and hour cases.

The amendment of Labor Code §218.5 does not affect a prevailing employee’s right to attorneys’ fees and costs in wage and hour cases.

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California Supreme Court Depublishes Three Decisions Interpreting Brinker

Last April, the California Supreme Court resolved long-standing confusion regarding the definition of the word “provide” in Labor Code §512, which requires employers to provide meal breaks to employees who work for more than five hours. In the landmark Brinker decision, the Court clarified that an employer must relieve its employees of all duties during a meal period. The decision was haled as a victory for employers because the Court did not require employers to police meal breaks, but was also looked at as a boon to employees, because employers must go beyond merely maintaining a policy permitting meal breaks.

Since Brinker, several California appellate court cases have interpreted the decision. Recently, however, the Supreme Court depublished three of these decisions. The Court’s depublication of the decisions indicates that the Court wants lower courts to use Brinker as precedent, rather than these appellate court decisions. The Court’s depublication strongly signals that these decisions improperly used an outdated definition of the word “provide,” which fails to take into account that employers must now take affirmative steps to relieve employees of all duties during breaks.

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New Amendments To FEHA Clarify Religious Accommodation Requirements

Recent amendments to California’s Fair Employment and Housing Act (“FEHA”) provide clarity regarding an employer’s duty to provide religious accommodations to its employees. FEHA protects employees from discrimination and harassment based on religion and requires employers to reasonably accommodate employees’ requests for religious accommodation unless such accommodation would cause “undue hardship” to the employer.

Under the 2013 amendments, to prove undue hardship, an employer must demonstrate “significant difficulty or expense” associated with the religious accommodation. This definition requires an employer to make every practical effort to provide religious accommodations to its employees, including considering alternative accommodations rather than simply denying an employee’s request for accommodation.

FEHA also protects employees’ “religious observances.” The new amendments clarify that religious clothing, dress, and grooming practices fall under the category of religious observances. Therefore, if a dress or grooming practice is an essential component to an employee’s religious practice, then an employer must accommodate the practice unless doing so would cause an undue hardship. Practically speaking, this means that employees may be entitled to religious accommodations from their employers’ official dress code policies.

Finally, the new amendments prohibit California employers from segregating employees from customers to accommodate employees’ religious beliefs. Thus, employers will now have to suggest alternative reasonable accommodations that do not include relocating employees to a back office or away from public view.

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Los Angeles Jury Awards Record $21.7 Million in Employment Discrimination Case

In one of the first tests of Harris v. The City of Santa Monica, a Los Angeles jury awarded the plaintiff in an employment discrimination case a record $21.7 million.

In Rodriguez v. Valley Vista Services Inc., BC 473793 (Los Angeles Super. Ct.), the jury found that the defendant, Valley Vista Services, discriminated against the plaintiff, April Rodriguez. Ms. Rodriguez suffered from panic attacks and maintained that the defendant failed to accommodate her mental disability. Valley Vista argued that it fired Ms. Rodriguez for performance-based reasons because she failed to call for three days.

Under the California Supreme Court’s decision in Harris, the jury was instructed that, in order to support a verdict for Ms. Rodriguez, it would have to find discrimination was a “substantial” factor in Valley Vista’s decision to fire Ms. Rodriguez. Finding that Valley Vista’s assertions of lawful motives for Ms. Rodriguez’s termination not credible, the jury awarded Ms. Rodriguez $5.2 million in compensatory damages. The jury also determined that the employer had acted with malice and awarded Ms. Rodriguez $16.5 million in punitive damages as well.

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EEOC Issues New Regulations For Determining Disabled Employees

On March 24th, 2011 the Equal Employment Opportunity Commission(EEOC) established new regulations to the Americans with Disabilities Act (ADA) that would enable employers to determine who qualifies as disabled. The new ADA Amendments Act (ADAAA) overturned a few Supreme Court decisions that Congress believed determined disability “too narrowly.” The amendment now includes HIV infection, diabetes, epilepsy and bipolar disorder which congress felt “should easily be concluded to be disabilities.”

Congress says both employers and employees will benefit from these new regulations. From an attorney’s standpoint Condon McGlothlen from the firm Seyfarth Shaw said:” More disability lawsuits can be expected to be filed and importantly, those lawsuits will be become much harder to defend against at an early pleading stage.” A rise in disability lawsuits in 2011 may not be directly attributed to these new regulations; Bloomberg reports that 25,000 disability discrimination claims were filed in 2010 up from 21,400 in 2009. Gary Phelan an attorney with Cohen and Wolf whose clients are mostly employees, said on the Law Blog that “in those cases where there are close calls about where an individual meets the definition of disability, more employees will be covered under the ADA.” If these new regulations would be detrimental to businesses why would the chamber off commerce sign off on the ADAAA? Michael Eastman, director of labor law for the chamber of commerce told Bloomberg that the new disability terms should not harm companies.

Even with Congress and the chamber of commerce’s assurances, companies should be gearing up for new disability claims from employees now these regulations are in the act.

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