Newly-Published Labor and Employment Law Cases

Duran v. EmployBridge Holding Co. (CA5 F084167, filed 4/27/23, ord. pub. 5/30/23) PAGA Arbitration 

The applicable arbitration agreement stated that “claims under PAGA … are not arbitrable under this Agreement.” The court found it not objectively reasonable to interpret the phrase “claims under PAGA” to include some PAGA claims while excluding others, and thus the carve-out provision excluded all PAGA claims from the agreement to arbitrate. Accordingly, the court affirmed the trial court’s denial of the motion to arbitrate Duran’s PAGA claims.

Kourounian v. Cal. Dept. of Tax & Fee Administration (CA2/8 B309007 5/24/23) Retaliation | Admission of Evidence 

Kourounian obtained a $425,562 jury verdict in his favor on his claim that the California Department of Tax and Fee Administration retaliated against him for filing an internal complaint with its Equal Opportunity Office. On appeal, the court reversed and remanded, finding the trial court erred in admitting evidence about activity that occurred before the filing of Korounian’s EEO complaints, and that admission of the first EEO complaint and supplement was prejudicial and prevented the Department from receiving a fair trial.

P. ex rel. Garcia-Brower v. Kolla’s, Inc. (SC S269456 5/22/23) Complaint of Already Known Wage and Hour Violations | Protected Disclosure 

Labor Code section 1102.5(b) prohibits employers from retaliating against employees for “disclosing information” concerning suspected violations of the law either internally or to government or law enforcement agencies. Resolving a split among the courts of appeal, the California Supreme Court held that a report of unlawful activities made to an employer or agency that already knew about the violation is a protected “disclosure” within the meaning of section 1102.5(b).

Hodges v. Cedars-Sinai Medical Center (CA2/8 B297864, filed 4/28/23, pub. ord. 5/19/23) FEHA Disability Discrimination | Medical Exemption from Flu Vaccine 

As a condition of continued employment, Hodges was required to get a flu vaccination unless she obtained an exemption based on a medically recognized contraindication to getting the vaccine. Hodges’ doctor recommended an exemption because of Hodges’ history of cancer and general allergies, but not for any reason recognized as a contraindication to receiving the flu vaccine. Cedars-Sinai denied Hodges an exemption, and then fired her when she refused the vaccination. The court found no triable issue of fact as to physical disability discrimination because Hodges produced no evidence that any reaction she might have to the flu vaccine would amount to a disability. Summary judgment was also appropriate because Cedars-Sinai presented a legitimate, nondiscriminatory reason for Hodges’ termination (her refusal to take the flu vaccine) and she made no argument that this reason was pretextual.

Castelo v. Xceed Financial Credit Union (CA2/7 B311573 5/18/23) Arbitration | Release in Separation Agreement 

Civil Code section 1668 invalidates a pre-dispute release only when the release purports to contract away liability for future unknown claims. An arbitrator’s ruling that Castelo’s release did not violate Civil Code section 1668 was affirmed. Castelo signed the separation agreement after she was informed of the decision to terminate her but before her last day on the job. At the time she signed, she already believed that the decision to terminate her was based on age discrimination and that she had a valid claim for wrongful termination. The alleged violation of FEHA had already occurred, even though the claim had not yet fully accrued. Accordingly, the release did not violate section 1668 because it was not a release of liability for future unknown claims. 

Ohio Adjutant General’s Dept. v. FLRA (US 21-1454598, U. S. ____ (2023), 5/18/23) National Guard Dual-Status Technicians

A state National Guard acts as a federal agency for purposes of the Federal Service Labor-Management Relations Statute when it hires and supervises dual-status technicians serving in their civilian role. Accordingly, the Federal Labor Relations Authority had jurisdiction over a union’s unfair labor practice complaint alleging that the Ohio National Guard violated the FSLMRS when it refused to negotiate over terms and conditions of employment of dual-status technicians.

Perez v. Kaiser Foundation Health Plan (CA1/3 A165140 5/16/23) Arbitration | Employee Health Plan 

Health and Safety Code section 1363.1’s requirement that an arbitration agreement must appear directly before the signature line was met where the arbitration agreement appeared directly before sentences explaining that clicking the “SAVE” button serves as an electronic signature on the arbitration agreement. The resulting arbitration award in favor of Kaiser need not be vacated because the arbitrator timely disclosed grounds for disqualification as required by Code of Civil Procedure section 1281.9. At the time of his selection by the parties, the arbitrator disclosed that he had several other pending cases where Kaiser was a party; he was not required to disclose the outcome of those cases that were resolved while Plaintiffs’ arbitration was pending.

Roberts v. Springfield Utility Board (9^th Cir. 21-36052, 5/12/23) First Amendment Speech

When it placed Roberts on paid administrative leave pending an investigation into whether he had been untruthful about unscheduled time off, the Board admonished Roberts not to discuss the investigation with other employees. When a public employer instructs an employee not to communicate with potential witnesses regarding a workplace misconduct investigation during the pendency of that investigation, the impacted speech generally is not on a matter of public concern that would entitle it to First Amendment protection. Rather, any impacted speech would concern an individual personnel dispute that is of no relevance to the public’s evaluation of the public agency’s performance. The speech restriction thus did not impact Roberts’ First Amendment rights.

Alberto v. Cambrian Homecare (CA2/4 B314192, filed 4/19/23, pub. ord. 5/11/23) Arbitration | Unconscionability 

Under Civil Code section 1642, the confidentiality agreement signed by Alberto as part of her hiring was properly read together with the arbitration agreement signed at that same time because they both governed how to resolve disputes between Alberto and Cambrian arising from Alberto’s employment. The confidentiality agreement was substantively unconscionable because it required Alberto to consent to an immediate injunction order prohibiting disclosure of certain information and to pay Cambrian’s attorney fees for any such order, prohibited Alberto from discussing her wages with others in violation of Labor Code section 232, and purported to waive Alberto’s right to bring representative PAGA claims. The trial court did not abuse its discretion by declining to sever the unconscionable provisions and enforce the remainder of the agreement.

Quinn v. LPL Financial LLC (CA2/8 B313414 5/10/23) Misclassification 

Under Labor Code section 2783, the employment status of individuals in certain occupations continues to be governed by the test in S.G. Borello & Sons, Inc. v. Dept. of Industrial Relations (1989) 48 Cal.3d 341, rather than the ABC test articulated in Dynamex Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903. Plaintiff Quinn is engaged in one of the occupations listed under section 2783—securities broker-dealers or investment advisers or their agents and representatives that are registered with the Securities and Exchange Commission or the Financial Industry Regulatory Authority. (§ 2783, subd. (d)(1).) Because it is rational to think people licensed to work as financial professionals have more skill and bargaining power than the average worker and do not need a new classification test, section 2783(d)(1) does not violate the Equal Protection clause. Quinn’s due process claim fails because an individual has no vested right to a particular legal test for determining employment status, and thus section 2783’s retroactive application could not have deprived Quinn of a vested right.

Nirschl v. Schiller (CA2/4 B313105 5/10/23) Defamation | Proposed Severance Agreement 

Statements made when an employer terminates an employee are not protected by California’s anti-SLAPP law (Code of Civil Procedure section 425.16) solely because the employer asks the employee to sign a release of claims. The anti-SLAPP law makes “any written or oral statement or writing made in connection with an issue under consideration or review by a . . . judicial body” protected activity. (§ 425.16, subd. (e)(2).) Statements Nirschl’s employer made to an intermediary during negotiation of a settlement and release were not protected by the anti-SLAPP statute because at that time litigation was “merely theoretical rather than anticipated” since the negotiations could have resolved the parties’ dispute.

Young v. RemX Specialty Staffing (CA1/5 A165081 5/10/23) PAGA | Temporary Services Employees

Under Labor Code section 201, an employee who is discharged must immediately be paid all wages earned and unpaid at the time of discharge. A “discharge” occurs only when there is an employment relationship, as when a temporary services employee is fired from the temporary services employer. Young, an employee of a temporary services company, thus was not entitled to immediate payment of wages due upon having her assignment terminated by a company client when she still remained an employee of the company.

L.A. Unified School Dist. v. Office of Admin. Hearings (CA2/8 B317353 5/5/23) Teacher Suspension 

Education Code section 44939 allows a teacher suspended pending dismissal to move for immediate reversal of the suspension. Section 44939 further provides that such a motion is “the exclusive means of obtaining interlocutory review of suspension pending dismissal,” that the “grant or denial of the motion is not subject to interlocutory judicial review,” and that the ruling on the motion “shall not be considered . . . in determining the validity of the grounds for dismissal, and shall not have any bearing on the . . . determination regarding the grounds for dismissal.” The court held that, because it has no bearing on the merits of the dismissal appeal, a ruling reversing a teacher’s suspension pending dismissal is not judicially reviewable after a final decision has been rendered in the dismissal proceedings. Accordingly, after it prevailed in the teacher’s dismissal appeal, the District could not seek to recover salary paid to the teacher pursuant to the suspension reversal order.

Lion Elastomers LLC (NLRB 16-CA-190681 5/1/23) NLRA Protected Activity

The National Labor Relations Board overruled General Motors LLC (2020) 369 NLRB No. 127 and reinstated its prior setting-specific standards for determining when an employee’s conduct while exercising rights under the National Labor Relations Act amounts to misconduct egregious enough to lose the Act’s protection. In so doing, the Board criticized General Motors as improperly focusing on the employer’s motive rather than the effect disciplining the employee under the circumstances would have on the exercise of protected rights under the Act.