Shulman Bastian LLP

May 2018 Archives

Ninth Circuit Removes Requirement to Attend Hearing and Object to Confer Standing to Appeal Bankruptcy Court Orders

In In re Point Center Financial, Inc., No. 16-56321, slip op. (9th Cir. May 29, 2018) the Ninth Circuit Court of Appeals decided whether attendance at a hearing and an objection to a bankruptcy court ruling are prerequisites to having standing to appeal the same. Generally, only a person aggrieved by a bankruptcy court order may appeal entry of the same. A person aggrieved is someone who is directly and adversely affected pecuniarily by a bankruptcy court order, such as when an order diminishes one's property, increases one's burdens, or detrimentally affects one's rights. Duckor Spradling & Metzger v. Baum Tr. (In re P.R.T.C., Inc.), 177 F.3d 774, 777 (9th Cir. 1999); Fondiller v. Roberson (In re Fondiller), 707 F.3d 441, 443 (9th Cir. 1983).

Third District Court of Appeal Holds Higher Penalty Provision Applies to PAGA Claims for Wage Statement Violations

The Private Attorneys General Act of 2004 (PAGA) allows an employee to bring representative claims on behalf of similarly aggrieved employees to recover "civil penalties" previously only recoverable by the Labor and Workforce Development Agency (LWDA) for violations of various Labor Code sections. If there is no existing civil penalty, PAGA also provides a default penalty provision. As such, in determining potential exposure with respect to a PAGA claim, it is critical to determine the applicable civil penalty. But in recent years, California and Ninth Circuit courts have issued a number of conflicting decisions in this area. With respect to wage statement violations, however, a recent decision by the Third Circuit Court of Appeal indicates a growing consensus.

Class Action Waivers in Employment Arbitration Agreements are Enforceable

Today, the United States Supreme Court finally resolved the split of authority among federal circuit courts as to the enforceability of class action waivers in employment arbitration agreements. In issuing its much anticipated opinion in NLRB v. Murphy Oil Co., Ernst & Young LLP v. Morris and Epic Systems Corp. v. Lewis, the Supreme Court held that class action waivers in employment arbitration agreements do NOT violate the National Labor Relations Act and are therefore enforceable. This is good news for employers everywhere and a prime opportunity to consider updating employment arbitration agreements to include class action waivers.

Factoring a Flat Sum Bonus Into An Employee's Overtime Pay Rate

Under California law, an employer is obligated to pay an overtime premium for work in excess of eight hours in a day, 40 hours in a weeks, or for any work at all on a seventh consecutive day. See Alvarado v. Dart Container Corp. of California, 4 Cal.5th 542, 553 (2018), as modified at 2018 Cal. LEXIS 2979 (April 25, 2009). Such work must be compensated at 1.5 times the employee's "regular rate of pay," or, if the employee works in excess of 12 hours in a day or in excess of eight hours on a seventh consecutive working day, at two times the employee's regular rate of pay. Id.

Employers Beware -Post-Dynamex, the Classification of Workers as Independent Contractors Will be Met With Greater Scrutiny

On April 30, 2018, the California Supreme Court issued its opinion in Dynamex Operations West, Inc. v. Superior Court (2018 Cal. LEXIS 3152) wherein it decided what standard applies, under California law, to determine whether workers should be classified as employees or as independent contractors for purposes of California wage orders (which impose obligations relating to, among other things, minimum wages, maximum hours and required meal and rest breaks). In holding that the wage order's definition of "employ" must be used to determine independent contractor versus employee status ("employ," meaning "(a) to exercise control over the wages, hours, or working conditions, or (b) to suffer or permit to work, or (c) to engage, thereby creating a common law employment relationship"), the Court explained what it means to "suffer or permit" an individual to work: 

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