Keep On Truckin’—California State Court Judge Finds ABC Test Does Not Apply to Owner-Operators; Federal Court Extends TRO In Favor of California Trucking Association

On January 8, a trial court judge in Los Angeles issued an order finding the ABC Test—now used to determine independent contractor status in California—could not be applied to independent contractor truck drivers (“owner-operators”) due to federal pre-emption concerns.  While the decision represents a major victory for trucking companies, it will be subject to challenge.

As the end of the year descends upon us, it is time for workplaces to have their December gatherings, and like everything else in the employment setting these days, employers must be on their guard to not create situations that could lead to potential legal liabilities.  The following is a quick reminder of considerations for holiday parties.

New CA Court of Appeal Decision Provides a Basis for Finding Insurance Coverage of Wage and Hour Lawsuits under Employment Practices Liability Insurance Policies

Liability insurance policies typically provide two forms of coverage:  (1) coverage for the defense of lawsuits alleging claims covered by the policy in question, and (2) coverage for the settlement of claims covered by the policy in question that the insurer and the insured agree to for payment of a judgment against the insured when a judgment is the result of a covered claim against the insured.

What You Need to Know About the AB 5 “Business-to-Business” Exemption

California Assembly Bill 5 (“AB 5”), which codified significant changes to the test for independent contractor status, has caused substantial upheaval for California businesses.  As the statute will likely result in significant litigation over the next several years, California companies are scrambling to guard against its impact where possible.  One potential avenue to do so is the statute’s “business-to-business” exemption.  This alert discusses the requirements businesses must understand if they are to satisfy the criteria of the exemption.

Raising the Bar: DOL Increases Salary Threshold for Federal White Collar Exemptions

On September 24, 2019, the U.S. Department of Labor announced a final rule modifying the earnings thresholds necessary to exempt executive, administrative and professional employees from the Fair Labor Standards Act’s (FLSA) minimum wage and overtime pay requirements. The rule also allows employers to count a portion of certain bonuses/commissions towards meeting the salary level. The thresholds were last updated in 2004, though the DOL briefly adopted more significant changes—which never took effect—in 2015.

California Expands Time for Employees to Bring Discrimination, Harassment, and Retaliation Actions

The Fair Employment and Housing Act (“FEHA”) has always contained a two layered statute of limitations for employees to bring lawsuits against their employers for discrimination, harassment, and retaliation.  Formerly, employees had one year to file an administrative complaint with the Department of Fair Employment and Housing (“DFEH”) from the date of the alleged discrimination, harassment, or retaliation.  If an employee did not comply with this administrative requirement, then the employee’s complaint would be subject to dismissal for failure to exhaust administrative remedies.  Even if an employee were to file a timely administrative complaint, they were subject to a one year statute of limitations for filing a civil action from the time they received a right to sue letter from the DFEH.  The Stop Harassment and Reporting Extension Act (“SHARE Act”) has greatly expanded employee rights. (AB 9, 2019).

Employer Obligations In The Event Of Closures Due to California Wildfires and Power Outages

Natural disasters are something that many don’t think about until it’s too late, particularly in the context of their business obligations, but as extreme winds, wildfires, and power outages continue to pick up in California, employers should consider what obligations exist as to their employees and employment law.

Supreme Court Denies Plaintiffs the Ability to Seek Recovery of Unpaid Wages Under PAGA

On September 12, 2019, the California Supreme Court decided in a unanimous decision that in a Private Attorneys General Act (PAGA) action seeking to recover penalties under California Labor Code Section 558, a plaintiff may recover civil penalties but may not recover actual unpaid wages. This is an important decision, which now clearly prevents a plaintiff from seeking both statutory penalties and wages under PAGA (as is often argued by the plaintiff). The high court did, however, reinforce that actions seeking statutory penalties under PAGA cannot be compelled to arbitration.

Deadline for Sexual Harassment Prevention Training Extended to January 1, 2021 for Some Employees

On August 30, 2019, California Governor Gavin Newsom signed urgency legislation to extend the deadline to provide certain employees required sexual harassment training until January 1, 2021.  (Senate Bill 778).  Last year, Senate Bill 1343 amended Government Code section 12950.1 to require employers with five or more employees to provide two hours of sexual harassment prevention training to all supervisory employees and one hour of sexual harassment prevention training to all nonsupervisory employees by January 1, 2020.   

California Supreme Court Rejects Conversion Claim for Unpaid Wages

Can an employee sue his employer for unpaid wages by claiming that his employer and its principals “converted” his personal property to their own use, and that the principals are individually liable for the employer’s conduct? No, held the California Supreme Court in the recent case of Voris v. Lampert, (Cal S Court Case No. S241812), issued on August 15, 2019. 

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