In Antelope Valley Press v. Poizner, the Borello “right to control” and related factors were again applied to find an employer-employee relationship

/

Greatsealcal100Because employers reap substantial savings when independent contractors can satisfy the needs of a business in place of employees, there is a financial incentive to misclassify employees as independent contractors. Decisional authority agrees that, due to the “infinite variety of service arrangements,” it is difficult to formulate a single test or standard that can determine whether an individual should be classified as an employee or an independent contractor. (S. G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341, 350 [256 Cal.Rptr. 543].)

In Borello, the California Supreme Court collected its decisions on the determination of an employment relationship. Borello held that “ ‘[t]he principal test of an employment relationship is whether the person to whom service is rendered has the right to control the manner and means of accomplishing the result desired....’ ” (Borello, at p. 350.) Borello then discussed “secondary” indicia of the nature of the service relationship. First, Borello said that “ ‘[s]trong evidence in support of an employment relationship is the right to discharge at will, without cause.’ ” (Ibid.) Borello then summarized other “secondary” indicia of employment status:

Additional factors have been derived principally from the Restatement Second of Agency. These include (a) whether the one performing services is engaged in a distinct occupation or business; (b) the kind of occupation, with reference to whether, in the locality, the work is usually done under the direction of the principal or by a specialist without supervision; (c) the skill required in the particular occupation; (d) whether the principal or the worker supplies the instrumentalities, tools, and the place of work for the person doing the work; (e) the length of time for which the services are to be performed; (f) the method of payment, whether by the time or by the job; (g) whether or not the work is a part of the regular business of the principal; and (h) whether or not the parties believe they are creating the relationship of employer-employee.

(Borello, at p. 351.) Since Borello, defendants have chafed at reliance upon Borello outside of the worker’s compensation context. Those challenges have uniformly been rejected:

Read More

The second of Senator Margett's attacks on California's meal break law is also in freefall

/

The likely demise of SB 1192 was covered previously by The Complex Litigator.  (See, "That would be 'Plaintiffs: 2, Defendants: 0'".)  Senator Margett's second challenge to the present formulation of California's meal break law, SB 1539, a bill that sought to dillute the statutory entitlement to meal breaks or sue for missed meal break wages, made it out of committee, was substantially amended on April 15th, and set for hearing today.  That hearing was withdrawn.  It looks like legislative efforts to revise how meal breaks are treated is back to square one.  With a democratically controlled legislature and a governor that, despite liberal tendencies, is generally in favor of any legislation that eases requirements for business, it appears unlikely that anything will be sorted out any time soon.

[Via Wage Law.]

UPDATE:  For an alternative view on the significance of the recent history of SB 1539, read the recent post at the California Labor & Employement Law Blog, entitled "California Legislature Indicates Intent To Clarify Meal Period Law."  California Labor & Employment Law Blog says, "While the meal period laws have not been changed, the Legislature’s declaration of intent is a good sign that lawmakers recognize the need for change and will continue to have further discussions to try to find consensus on a solution that contains adequate protections for employers and employees."  Only time will tell, but I don't share their "optimism." 

Read More

Whiplash warning: Bell v. Superior Court (H.F. Cox, Inc.) is depublished

/

We live in amazing times.  Not three minutes after I published my last post about Bell v. Superior Court (H.F. Cox, Inc.), 158 Cal.App.4th 147 (2007), Ms. Kralowec (The UCL Practitioner) was kind enough to alert me via e-mail to the fact that the Supreme Court has reversed itself on the depublication request in Bell:

The order filed on April 23, 2008 is hereby amended to read in its entirety: The petition for review is denied. The requests for an order directing depublication of the opinion are granted. The Reporter of Decisions is directed not to publish in the Official Appellate Reports the opinion in the above-entitled appeal filed November 21, 2007, which appears at 158 Cal.App.4th 147. (Cal. Const., art. VI, section 14; rule 8.1125(c)(1), Cal. Rules of Court.) George, C.J., was absent and did not participate. Kennard J., is of the opinion the petition should be granted.

(Kralowec, "Supreme Court depublishes class certification opinion: Bell v. Superior Court (H.F. Cox, Inc.)" The UCL Practioner, www.theuclpractitioner.com.)  The customary blog nomenclature is "Hat Tip to...." or "Nod to ...." as a thank you for being the source of useful information.  That just doesn't seem good enough in this case, so...Thanks!

Read More

The value of precedent depends on perspective: Bell v. Superior Court (H.F. Cox, Inc.)

/

Greatsealcal100 In a post from earlier today, The UCL Practitioner reported that "[o]n Wednesday, the Supreme Court denied review and depublication in Bell v. Superior Court (H.F. Cox, Inc.), no. S160423."  (Kralowec, "Supreme Court denies review and depublication in class certification case: Bell v. Superior Court (H.F. Cox, Inc.)," The UCL Practioner, www.theuclpractitioner.com.)   In an earlier post on that same blog, The UCL Practitioner, noting that the Bell decision contained "some interesting language on the 'superiority' element of class certification," quoted from the opinion:

The opinion contains some interesting language on the "superiority" element of class certification: The party seeking class certification has the burden to establish that class action will be a superior means of resolving the dispute. (Aguiar v. Cintas Corp. No. 2, supra, 144 Cal.App.4th at pp. 132-133.) Our Supreme Court recently addressed the issue of the superiority of a class action in a wage and hour case. In Gentry v. Superior Court (2007) 42 Cal.4th 443, the Supreme Court concluded that both factors on which the trial court relied in this case – the size of some claims suggesting individual enforcement and the possibility of administrative proceedings before the Labor Commissioner – were insufficient to deny class certification. The court noted that there are many other factors in favor of class resolution in such cases, including that current employees might not bring individual claims out of a fear of retaliation, that current employees might not know of their rights (especially where, as here, the employer has affirmatively told them they are not eligible for overtime), and the necessity of class actions to give teeth to wage and hour laws even when some employees may have claims large enough for individual enforcement. (Id. at p. 459-462.) The court specifically held that an administrative action before the Labor Commissioner was an inadequate substitute for a class action. (Id. at p. 465.) As such, the trial court’s conclusion that a class action is not superior cannot stand.

(Kralowec, "New class certification decision: Bell v. Superior Court (H.F. Cox, Inc.)," The UCL Practioner, www.theuclpractitioner.com, quoting Bell.) My reaction to Bell at the time was that it seemed substantially more useful to plaintiffs than defendants.  As an aside, this is almost always true when a Court of Appeal reversed any part of a denial of certification.  Reversing a certification denial order, in any part, is a big deal.  Certification decisions are reviewed for abuse of discretion, and trial courts get the benefit of the doubt on appeal.

Today, I argued (successfully) against a defendant that sought to decertify a class.  Relying heavily on Bell, the defendant attacked a garden-variety class definition used in overtime/off the clock cases as lacking ascertainability.  Bell included some language that made defendant's argument more than trivial to overcome.

The defendant's use of Bell, an apparently plaintiff-friendly case, was sobering.  I was reminded of the danger inherrent in evaluating new precedent through the bias of one's primary practice area, in my case, predominantly plaintiff-side class actions.  While it is usually the case that a defendant, seeking decertification, would shy away from any certification opinion where any portion of a denial of certification was reversed, there are no guarantees that you won't have to deal with "surprise" citations.  In Bell, as in most cases, there are bits and pieces that are as useful to defendants as to plaintiffs, depending upon what issues are in play.

My unsolicited advice to erstwhile class action practitioners is to set aside some time to read each and every new class action decision, front to back, at least once while it is still hot off the presses.  Your early read of new authority may be enough to help you avoid surprises down the line.

UPDATE:  Aside from also reporting on the depublication of Bell earlier today, Wage Law notes that while Bell "had seemed to favor the plaintiff (who was the petitioner seeking Supreme Court review) the Court of Appeal's endorsement of the denial of certification in the off-the-clock and meal period causes of action had been embraced by the employers' bar, who will lament the depublication of the case."  ("Supreme Court Depublishes Bell v Superior Court (HF Cox, Inc.)," Wage Law, www.wagelaw.typepad.com.)

Read More

Class Action Defense Blog provides good "unofficial" filing data

/

If statistics and trends interest you, then click, don't walk, over to the Class Action Defense Blog.  As a regular feature, Class Action Defense Blog summarizes (with self-described "unofficial" data) the number and type of class action filings in the major metropolitan centers of California.  Their April 19, 2008 post is good example of the type of summary you will find on the site.  In reviewing the numbers for at least 2008, it should come as little surprise to most class action practitioners that wage & hour class actions habitually hold sway with the largest percentage of filings by claim type.

Class Action Defense Blog is unashamedly and openly a firm-sponsored blog of Jeffer, Mangels, Butler & Marmaro, LLP, so it understandably tends towards a staid tone in its posts (I, on the other hand, having no restraining guidance behind me, am a loose cannon that could go off at any time).  That blog is, nevertheless, dense with information about results and transactions in class actions around the country.

Read More

That would be "Plaintiffs: 2, Defendants: 0"

/

Earlier today I ran across a post at The Witness Box, a blog by the law firm Jackson Lewis.  Their post, entitled "Wage and hour developments: 1 for the plaintiff - 1 for the defense," presented two wage & hour developments, one apparently "pro-plaintiff" and one apparently "pro-defense."  The "pro-plaintiff" development concerns Massachusetts law; it is thus of little interest to me, particularly for this presumably California-centric blog.  The "pro-defense" development is another matter.

Wage & hour practitioners will recall Murphy v. Kenneth Cole Prods. (2007) 40 Cal.4th 1094, in which the California Supreme Court determined that the one hour of pay owed to an employee that misses a meal break is a wage and not a penalty (with a 1-year Statute of Limitation).  When coupled with Unfair Competition Law claims, this ruling effectively provided a 4-year Statute of Limitation to claims for missed meal breaks.

Not excited yet, Non-Wage & Hour Practitioner?  Then let me try to expand the relevance a little.  Murphy resulted in a predictable upswing in meal break claim class actions.  Earlier this year, Senator Margett introduced SB 1192, which would have re-classified the "pay" owed to an employee for a missed meal break as a penalty, thereby truncating the claim period to one year.  Which brings me to my observation about the post on the Witness Box.  According to The Witness Box article, SB 1192 represents the legislature's effort to ease penalties for missed meal breaks.

Not so fast.  According to the California Sentate, the first hearing on SB 1192 was "canceled at the request of author."   Couple that with reporting by Storm's California Employment Law blog that "SB 1192 appears dead," and things aren't looking good for SB 1192.  Or for that premature call of "1 for the plaintiff - 1 for the defense."  The moral of the story is that it is good to know about proposed legislation, but don't place any weight on a bill that hasn't even managed to have its scheduled hearing in committee.

Read More