Newly-Published Labor and Employment Law Cases

Casson v. Orange County Employees Retirement System (CA4/3 G060950 1/30/23) Public Sector Disability Retirement 
The County Employees Retirement Law of 1937 allows an employee entering a county pension system who has prior service credit with another public pension system to elect reciprocity between the two pensions. Government Code section 31838.5 precludes a “disability allowance” that exceeds the amount a member would receive had he or she stayed in a single pension system. Because Casson did not elect reciprocity when he became a member of the Orange County Employees Retirement System, section 31838.5’s limitation on the amount of a disability allowance did not apply, and thus the System could not impose an offset on his disability allowance.

Murrey v. Superior Court (CA4/3 G061329 1/30/23) Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act | Arbitration
The Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (9 U.S.C. §§ 401, 402), enacted on March 3, 2022, did not apply retroactively to Murrey’s complaint filed in March 2021. The arbitration agreement was procedurally unconscionable because it did not identify the arbitration provider, the rules under which the arbitration would be conducted, or the arbitration location. The agreement was substantively unconscionable because it required each party to bear the “reasonable cost of compliance” with discovery requests; limited the number of depositions (3), interrogatories (20), requests for documents (15), and requests for admission (15); limited the arbitration hearing to 16 hours; limited the number of witnesses to 5 per party, including expert witnesses; and required Murrey to keep the arbitration award confidential without a demonstrated business need (such as protecting trade secrets or proprietary information). Because the unconscionable provisions could not be severed from the remainder of the agreement, the court reversed and remanded for a new order denying the motion to compel arbitration.

Hernandez v. Meridian Management Services, LLC (CA2/8 B312814 1/30/23) Arbitration | Contract Enforcement by Other Employers 
Hernandez signed an arbitration agreement with Intelex Enterprises as her employer. Hernandez also worked for other firms that were legally separate from but functionally related to Intelex. When Hernandez brought employment claims against these other firms, they moved to compel arbitration under her agreement with Intelex, who was not a named defendant. The trial court properly denied the motion, finding equitable estoppel did not apply against Hernandez, the other firms were not acting as agents of Intelex, and the other firms were not third party beneficiaries of the arbitration agreement.

NLRB v. Aakash, Inc. (9th Cir. 22-70002 1/27/23) Removal of NLRB General Counsel | RNs as Statutory Supervisors
The NLRB’s General Counsel had authority to prosecute the unfair labor practice charge because the President did not act unlawfully by removing the prior General Counsel from office before the expiration of the General Counsel’s four-year term. The employer did not present sufficient evidence that the registered nurses it claimed were statutory supervisors had authority to discipline other employees or assigned or directed other employees’ work using independent judgment, and therefore failed to prove the certified bargaining unit including the nurses was inappropriate.

Bitner v. Dept. of Corrections & Rehabilitation (CA4/2 E078038 1/24/23) FEHA Sexual Harassment by Inmates | Public Entity Statutory Immunity 
Government Code section 844.6(a) provides that “a public entity is not liable for: (1) An injury proximately caused by any prisoner.” Plaintiffs’ claims under the Fair Employment and Housing Act for failure to prevent or remedy sexual harassment were not exempt from the immunity granted by section 844.6(a)(1). Further, even though plaintiffs forfeited the issue by not raising it in the trial court, the unrebutted evidence presented on summary judgment showed that the acts of sexual harassment of which plaintiffs complained were perpetrated by, and thus proximately caused by, prison inmates.

Wit v. United Behavioral Health (9th Cir. 20-17364 1/26/23) ERISA 
Plaintiffs had Article III standing to bring their breach of fiduciary duty and improper denial of benefits claims pursuant to 29 U.S.C. §§ 112(a)(1)(B) and (a)(3). However, because plaintiffs expressly declined to make any showing, or seek a determination of, their entitlement to benefits, permitting plaintiffs to proceed with their denial of benefits claim under the guise of a “reprocessing” remedy on a class-wide basis violated the Rules Enabling Act. On the merits, the panel held that the district court erred in excusing absent class members’ failure to exhaust administrative remedies as required under the plans. The district court also erred in determining that United Behavioral Health’s Level of Care Guidelines and Coverage Determination Guidelines improperly deviated from generally accepted standards of care (GASC) based on its interpretation that the underlying health plans mandated coverage that was coextensive with GASC. Therefore, the panel reversed the judgment on plaintiffs’ denial of benefits claim. To the extent the judgment on plaintiffs’ breach of fiduciary duty claim was based on the district court’s erroneous interpretation of the plans, it was also reversed. 

Vascos Excavation Group LLC v. Gold (CA2/5 B315205, filed 12/21/22, pub. ord. 1/20/23) Arbitration | Contractor License 
The trial court vacated an arbitration award in favor of Vascos Excavation Group on the ground it was an unlicensed contractor and therefore the contract containing the arbitration agreement was illegal. Vascos failed to meet its burden of proving it was a duly licensed contractor and had waived its argument that the trial court improperly denied it an evidentiary hearing by opposing such a hearing in response to Gold’s petition to vacate the arbitration award.

Imperial County Sheriff’s Assn. v. County of Imperial (CA4/1 D079274 1/20/23) Public Employee Retirement | Class Certification 
Three public employee unions and six individual employees filed suit against the County and its retirement system alleging they were systematically miscalculating employee pension contributions. The trial court refused to certify a class, finding a conflict of interest between employees employed by the County prior to the effective date of the Public Employees Pension Reform Act of 2013 who were entitled to a supplemental retirement benefit, and those hired after PEPRA took affect who were not eligible for that benefit. Denial of class certification reversed because any potential conflicts of interest may be resolved by certifying subclasses. Remanded for trial court to determine whether plaintiffs can adequately represent the subclasses.

Iyere v. Wise Auto Group (CA1/4 A163967 1/19/23) Arbitration| Signature Authenticity & Unconscionability 
Plaintiffs’ declarations that they did not remember signing an arbitration agreement were insufficient to create a factual dispute where the employer produced copies of the agreement bearing plaintiffs’ signatures and plaintiffs did not claim the signatures were inauthentic. Neither the agreement’s statement that it is governed by the Federal Arbitration Act nor its provision allowing the party against whom the claim is brought to choose between ADR Services, JAMS, or another mutually agreeable arbitration provider rendered the agreement substantively unconscionable.

Wu v. Public Employment Relations Bd. (CA3 C092640, filed 12/28/22, ord. pub. 1/19/23) PERB | Unfair Practice by Union 
A substitute teacher has no right to representation by a teachers’ union when the bargaining unit represented by the union excludes substitutes. The union thus owed Wu no duty of fair representation that could be breached by its failure to pursue her claim that she was misclassified as a substitute teacher.

Adanna Car Wash Corp. v. Gomez (CA2/5 B313649 1/18/23) Labor Commissioner Appeal Bond 
Under Labor Code section 98.2, an employer wishing to challenge the Labor Commissioner’s determination that wages are owed must post an undertaking in order for the trial court to have jurisdiction over the appeal. The $150,000 bond required by Labor Code section 2055 to operate a car wash in California does not satisfy section 98.2’s undertaking requirement.

Opara v. Yellen (9th Cir. 21-55953 1/17/2023) ADEA Age and Title VII National Origin Discrimination
The court affirmed summary judgment in favor of the employer on Opara’s age discrimination and national origin discrimination claims because she failed to produce evidence raising a genuine material factual dispute over the employer’s motive for terminating her. It was undisputed that Opara committed at least some of the offenses for which she was terminated, and the only evidence of the employer’s unlawful animus was Opara’s own allegations.

Brubaker v. Strum (CA2/7 B317694 1/13/23) Child & Spousal Support | Employer Earnings Assignment Orders 
Where an employer is subject to an earnings assignment order for an employee who owes spousal or child support, Family Code section 5241 protects the employee only from being held in contempt or subject to criminal prosecution for nonpayment of the support. The statute does not preclude the person to whom spousal or child support is owed from seeking arrearages or a determination of arrearages from the employee.

Pasadena Area Community College District (PERB Order No. Ad-500 1/11/23) Electronic Proof of Support
PERB Regulation 32700(d)(4) allows the submission of electronic signatures of “employees who are not exclusively represented by an employee organization” as proof of support for a representation petition. Electronic signatures of currently-represented employees in support of a petition to decertify the incumbent union and replace it with another were not valid under Regulation 32700(d)(4). Nor were they valid under subdivision (d)(5), which allows “[o]ther evidence as determined by the Board, provided that such evidence is consistent with the principles underlying this subsection (d),” because doing so would be inconsistent with the Board’s intent in subsection (d)(4) to limit electronic proof of support to petitions seeking to represent unrepresented employees.

Lathus v. City of Huntington Beach (9th Cir. 21-56197 1/5/23) First Amendment | Volunteer’s Dismissal 
The First Amendment does not protect a volunteer member of a municipal advisory board from dismissal by the city councilperson who appointed her and who is authorized under a city ordinance to remove her. Because the volunteer was the “public face” of the appointing councilmember, the public could infer that the volunteer’s speech reflected the views of the appointing councilmember and therefore she could be dismissed for lack of political compatibility.

Vaughn v. Tesla, Inc. (CA1/5 A164053 1/4/23) FEHA Public Injunctions | Preemption under Viking River
Based on the language of the arbitration provision, plaintiffs were not required to arbitrate claims against Tesla that arose when they were employed by a staffing agency prior to becoming Tesla employees. Plaintiffs’ request for a public injunction was not subject to arbitration because injunctions sought under the Fair Employment and Housing Act may be considered public injunctions, and the Federal Arbitration Act as interpreted in Viking River Cruises, Inc. v. Moriana (2022) ___ U.S. ___ [142 S.Ct. 1906, 213 L.Ed.2d 179] does not preempt the California rule prohibiting waiver of the right to seek such injunctions.

Regents of the University of California (San Francisco) (PERB Order No. Ad-499-H 1/4/23) Reasonable Accommodation
As a public entity, PERB must make reasonable modifications in policies, practices, or procedures to accommodate an individual’s disability or medical condition, unless such modifications would result in undue financial burden or fundamentally alter the nature of the service, program, or activity offered. If a party requests a reasonable accommodation that involves the other party or parties to the case in the accommodation process, they will have a corresponding right to receive notice and an opportunity to view medical documentation relied upon in support of the requests, and to present arguments regarding any such request.

Griego v. City of Barstow (CA2/8 B322638 1/3/23) Public Employee Termination | Independent Judgment 
The City did not abuse its discretion in terminating Griego’s employment based on an arbitrator sustaining three out of four allegations of misconduct, even though the fourth allegation in itself may have supported termination. The other three allegations demonstrated a lack of credibility, reliability, and trustworthiness that formed a reasonable basis for the termination. Under these circumstances, the trial court erred in remanding the matter back to the City for a new termination hearing.

Lemm v. Ecolab (CA2/5 B312232 1/3/23) Overtime | PAGA 
Under the Fair Labor Standards Act, an employer’s obligation to pay overtime is satisfied when a non-discretionary bonus is based on a percentage of gross earnings that includes overtime payments. The overtime formula set out in Division of Labor Standards Enforcement Manual section 49.2.4 does not apply in such circumstances; under Alvarado v. Dart Container Corp. of California (2018) 4 Cal.5th 542, section 49.2.4 applies only to flat sum attendance bonuses. The court of appeal lacked jurisdiction over Lemm’s appeal of motions on his reporting time and split shift claims that the trial court had sent to arbitration, as the appellate court had no authority to reverse the trial court’s arbitration order.