a California-centric collection of comments and resources about complex litigation and class action practice
As 2018 heats up with big decisions, Episode 17 is here just in time. Dynamex and Serrano v. Aerotek are discussed. More importantly, I decide to rename the ABC test.
For Class Re-Action podcast listeners looking for more options, you can now find this podcast on Spotify, iHeartRadio, and in the Google Play store, in addition to the iTunes location where we started.
The term "joint employer" is used to identify the wide variety of situations where one worker is controlled in frequently different ways by two employers. Staffing agency relationships with client companies are a commonly cited example. In Castillo v. Glenair, Inc., the Court of Appeal (Second Appellate District, Division Two), tackled a novel question:
In a joint employer arrangement, can a class of workers bring a lawsuit against a staffing company, settle that lawsuit, and then bring identical claims against the company where they had been placed to work.
Slip op, at 2. The Court's answer was succinct: "We answer no." (Slip op., at 2.)
Before you get the wrong idea, this is not the situation you might have first imagined. One firm did not sue a staffing agency, settle, and then bring the identical set of claims against the client company of the staffing agency. Rather, the staffing company class action was running in parallel before another trial court and made it to the settlement finish line first. (Slip op., at 2.) There are many procedural niceties to this that don't matter. What matters is that the first suit (known as the "Gomez" action), settled on a classwide basis, with a broad release of claims against the staffing company and its agents. The Court in this matter concluded that Glenair was an agent of CGA with respect to CGA's payment of wages to its employees who performed work at Glenair.
While the reasoning of the Court is guided, in part, by a number of factual stipulations of the parties regarding the relationship between Glenair and the staffing company GCA, the core issue for purposes of res judicata application of the Gomez settlement hinged on whether Glenair was either a party in the Gomez settlement or in privity with a party. The Court found that Glenair was both in privity with CGA as to the Gomez settlement and a released party in the Gomez settlement.
After reviewing developments in the law of privity, the Court said:
With this in mind, it is clear Glenair and GCA are in privity for present purposes. The subject matter of this litigation is the same as the subject matter of the Gomez litigation—namely, both cases involve the same wage and hour causes of action arising from the same work performed by the same GCA employees (the Castillos) at GCA’s client company Glenair. Based on the undisputed facts, it is apparent Glenair and GCA share the same relationship to the Castillos’ claims here. Both Glenair and GCA were involved in and responsible for payment of the Castillos’ wages. Glenair was authorized by GCA and responsible for recording, reviewing and transmitting the Castillos’ time records to GCA. GCA paid the Castillos based on those time records. And, by virtue of the Gomez settlement, the Castillos were compensated for any errors made in the payment of their wages. Thus, with respect to the Castillos’ wage and hour causes of action, the interests of Glenair and GCA are so intertwined as to put Glenair and GCA in the same relationship to the litigation here. Accordingly, we conclude they are in privity for purposes of the instant litigation.
(Slip op., at 23.) The Court emphasized that this should not be construed as a finding that Glenair and GCA are in privity for all purposes (e.g., a tort claim for an on-premises injury). The Court also found that Glenair was an agent of CGA based on facts that could not be reasonably construed any other way:
Glenair was an agent of GCA for the purpose of collecting, reviewing, and providing GCA’s employee time records to GCA so that GCA could properly pay its employees. The evidence is undisputed that GCA authorized Glenair to collect, review, and transmit GCA employee time records to GCA. Thus, Glenair was authorized to represent, and did represent, GCA in its dealings with third parties, specifically GCA’s payment of wages to its employees placed at Glenair. (Civ. Code, § 2295; Borders Online, supra, at p. 1189; see also Garcia v. Pexco, LLC (2017) 11 Cal.App.5th 782, 788 [in concluding the plaintiff employee’s claims must be arbitrated, court considered “alleged joint employers” staffing company and its client company “agents of each other in their dealings with” the plaintiff].)
(Slip op., at 26.) The Court rebuffed the plaintiffs' argument that there was no evidence of the requisite control necessary to support the agency conclusion:
Here, GCA authorized Glenair to perform certain timekeeping-related tasks on behalf of GCA and the only reasonable inference is that GCA required Glenair to perform those tasks. Had Glenair failed to perform those timekeeping tasks, GCA would not have been able to pay its employees.
(Slip op., at 27.) This raises a question in my mind. Many large staffing companies install their own timekeeping systems in the workplaces of large clients. If the staffing company collects its own time records, or its employees report time themselves, does this vitiate the agency analysis in this decision?
The decision also includes an extended discussion of procedural rules governing summary judgment, if that floats your boat.
Respondent was successfully represented by Jesse A. Cripps, Sarah Zenewicz and Elizabeth A. Dooley of Gibson, Dunn & Crutcher,
Troester v. Starbucks Corporation has been set for oral argument before the California Supreme Court on Tuesday, May 1, 2018, at 9:00 a.m., in San Francisco.
Amicus Briefs and Responses have been added to the Troester v. Starbucks resources page.
The Class Re-Action podcast is back in business with new Episode 16, how available anywhere digital technology is! We discuss Alvarado v. Dart Container with attorneys who argued the case before the California Supreme Court. Listen loud! Listen often!
Setareh Law Group is expanding. If you are an attorney with wage and hour experience and have been practicing for roughly three to six years, you are welcome to reach out to me or Shaun Setareh at Setareh Law Group (contact information available via state bar -- if you can't find that, you shouldn't be sending anything anyhow). Reading my blog already demonstrates your discerning eye for insightful discourse, so test 1 is complete.
The California Supreme Court has agreed to weigh in on the issue of whether time spent on security searches is compensable. Here is the Court's description of the issue:
Frlekin v. Apple, Inc., S243805. (9th Cir. No. 15-17382; ___ F.3d ___, 2017 WL 3723235; Northern District of California; Nos. C 13-03451 WHA, No. C 13-03775 WHA, C 13-04727 WHA.) Request under California Rules of Court rule 8.548, that this court decide a question of California law presented in a matter pending in the United States Court of Appeals for the Ninth Circuit. The question presented is: “Is time spent on the employer’s premises waiting for, and undergoing, required exit searches of packages or bags voluntarily brought to work purely for personal convenience by employees compensable as ‘hours worked’ within the meaning of California Industrial Welfare Commission Wage Order No. 7?”
Justice Chin was recused and did not participate in the decision. Between this and other issues currently before the California Supreme Court, we will see more changes in wage and hour litigation in the next few years.
Well, it isn't a post that is devoid of law as a subject, but no appellate decisions to digest here at any rate.
Two stories caught my eye over at abovethelaw.com. In the first, it is reported that young associate hiring is set to increase at law firm. Yay! But, in the second, a hint that large corporation general counsel are looking at refusing to pay for time billed by young associates. That would impact the leverage model that large firms use. I suppose one is a longer term trend while the hiring is immediate, but it isn't outside the realm of possibility that the net impact of service outsourcing and automation, coupled with events like the proposed refusal to pay for young associates, might result in the substantial restructuring of the legal market in the next couple of decades.
How do you make summer associates feel like they are part of a team? You prank them.
I won't diminish the expectant quality of your Friday by providing a blow-by-blow of the decision, but Lambert v. Nutraceutical Corp. (9th Cir. Sept. 15, 2017) takes a thorough look at the timing requirements of Fed. R. Civ. P. 23(f) petitions, concluding that the 14-day filing deadline of Rule 23(f) is not jurisdictional and can be extended or tolled for a variety of reasons. The opinion also reversed the District Court's decertification order in the consumer class action, concluding that it erred in its treatment of the plaintiff's damage model.
Appellant was successfully represented by Gregory Weston (argued) and David Elliott, The Weston Firm, San Diego, California; and, Ronald A. Marron, The Law Offices of Ronald A. Marron APLC, San Diego, California.
The Complex Litigator reports on developments in related areas of class action and complex litigation. It is a resource for legal professionals to use as a tool for examining different viewpoints related to changing legal precedent. H. Scott Leviant is the editor-in-chief and primary author of The Complex Litigator.
