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More Quick Takes Re: California Employment Law

by D. Gregory Valenza | | February 2, 2019

Here are some summaries of recent developments.

Cal-OSHA Logs. First, it’s Groundhog Day.  And you know what that means! The annual obligation to post OSHA logs.  Here’s a handy press release issued by Cal-OSHA about the requirement and the process.   

Arbitration – It is important to draft your arbitration agreement to cover all claims against all potential defendants.  A court will compel arbitration even if the plaintiff tries to dodge the agreement by excluding from a lawsuit the employer that actually signed the agreement. In this case, the plaintiff worked for an agency that provided labor to farmers. The plaintiff sued a farmer client without suing the agency, which had in place an arbitration agreement with its employee.  But the agreement covered disputes that arose between employees and the agency’s clients, so to arbitration he will go. The case is  Vasquez v. San Miguel Produce and the option is here. 

Retaliation. A plaintiff claimed she reported her employer to the government for its failing to pay taxes correctly, and was fired in violation of Labor Code section 1102.5 and public policy.  She wanted the employer’s tax returns produced in discovery, but was denied them on the basis of taxpayer privilege. The employer then moved for summary judgment, but never bothered to provide a legitimate business reason and evidence negating “pretext.”  Rather, the employer argued only that without the tax returns, the plaintiff could not prove her case, and the tax returns were privileged.  Nice try.  The real issue in a retaliation case is whether the plaintiff reported an honest belief of wrongdoing to management or the government, and whether there’s a connection between that report and the negative action.  The court of appeal correctly held that the plaintiff could prove her case without the tax returns, through evidence she made a good faith report, and that the employer took negative action against her because of her complaint. This case is  Siri v. Sutter Home Winery and the opinion is here.  

Piece Rate:  The Court of Appeal denied a challenge to Labor Code section 226.2, which imposes a number of requirements concerning the use of “piece rates.”  As opposed to an hourly rate, a piece rate compensates employees by the unit produced, the task completed, etc.  Section 226.2 has vexed employers and payroll service companies for a couple of years now, and can lead to significant liability for minimum wage, overtime, rest period penalties, and other penalties as well.  The plaintiffs in this case, employers that paid piece rate along the lines of their industries, claimed the law was unconstitutional because it was vague.  A challenge to a statute’s constitutionality on the basis of “vagueness” is not easy; that is, about as difficult as riding a unicorn to Valhalla.  The Court held “the statutory language is discernable of meaning both in terms of plain English and in the context of the statutory scheme and applicable case law upon which the statute was based.”  So, section 226.2 is here to stay and employers must follow it, along with prior case law.  This case is Nisei Farmers League v. CA Labor & Workforce Dev. Agency and the opinion is here. 


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