Newly-Published Labor and Employment Law Cases

Allison v. Dignity Health (CA1/4 A169225, filed 6/2/25, pub. 6/24/25) Class Decertification | Meal & Rest Breaks
Allison, a former registered nurse (RN), filed a class action lawsuit against her former employer, Dignity Health, alleging, among others, claims for meal period and rest break violations. The trial court granted Dignity’s motion for class decertification, finding plaintiffs’ survey was unreliable and they had no manageable way of presenting class-wide proof of meal period violations at trial. The appellate court affirmed. The court found substantial evidence supported the finding that plaintiffs’ survey was unreliable because there was no evidence the actual participants were randomly selected. The court further found that anecdotal evidence offered in support of Dignity’s defense that employees chose to waive meal periods was sufficient to overcome the presumption of liability under Donohue v. AMN Services, LLC (2021) 11 Cal.5th 58.

Stanley v. City of Sanford, Florida (US 23–997 6/20/25) ADA | Retiree
Stanley was a firefighter for the City. She developed a disability that forced her to take disability retirement. Under City policy, Stanley was only entitled to 24 months of health insurance because she retired due to disability. Had Stanley retired after 25 years of service, she would have received health insurance until age 65. Stanley sued under the Americans with Disabilities Act, claiming the City violated the ADA by providing different health insurance benefits to those who retire with 25 years of service and those who retire due to disability. The district court dismissed her ADA claim, finding that because the alleged discrimination occurred after Stanley retired, she was not a “qualified individual” under the ADA. The Eleventh Circuit affirmed. The Supreme Court affirmed, holding that, to make out an ADA claim, a plaintiff must plead and prove that she held or desired a job, and could perform its essential functions with or without reasonable accommodation, at the time of an employer’s alleged act of disability-based discrimination.

Int’l Longshore & Warehouse Union v. NLRB, Pacific Maritime Ass’n v. NLRB, NLRB v. Int’l Longshore & Warehouse Union, Int’l Longshore & Warehouse Union & Aerospace Workers District 160, Local Lodge 289 v. NLRB (9th Cir. 23-632, 23-658, 23-780, 23-793 6/18/25) NLRA
This case arose out of a dispute over which union was entitled to perform maintenance work at SSA Terminal 5 at the Port of Seattle. The National Labor Relations Board (NLRB) assigned the work to the International Association of Machinists and Aerospace Workers (IAM). The International Longshore and Warehouse Union (ILWU) filed a grievance under its collective bargaining agreement with SSA seeking the value of work performed by IAM. After an arbitrator found in ILWU’s favor, SSA filed an unfair labor practice charge against ILWU alleging its pursuit of the grievance was intended to coerce SSA into assigning maintenance work to ILWU. ILWU defended that it was merely trying to preserve bargaining unit work. The NLRB held that a work preservation defense is not available in a pure jurisdictional dispute, and ordered ILWU to stop pursuing maintenance work at Terminal 5. The appellate court reversed, holding that the NLRB erred by refusing to entertain ILWU’s work preservation defense, which has been clearly articulated in Ninth Circuit precedent. The court remanded for the NLRB to evaluate the merits of ILWU’s work preservation defense.

Damiano v. Grants Pass Sch. Dist. No. 7 (9th Cir. 23-35288 6/16/25) First Amendment | Equal Protection
Plaintiffs were fired, and then reinstated and transferred to new positions, after they created on their own time and devices, a website and video expressing their views on gender identity. The district court granted summary judgment for defendants. The appellate court reversed in part. On plaintiffs’ First Amendment claim, the court found genuine factual disputes about the circumstances of plaintiffs’ expressive conduct and the extent of the resulting disruption to the District’s operations. The court further held that the factual disputes prevented determination of whether the District’s interests outweighed plaintiffs’ interest as a matter of law under a Pickering balancing test. On plaintiffs’ equal protection claim, the court found that a genuine factual dispute existed over whether defendants treated similarly situated employees differently based on their views of gender identity. On plaintiffs’ Title VII discrimination claim, the court found a genuine issue of material fact regarding the credibility of the District’s proffered reasons for plaintiffs’ terminations.

Silva v. Cross Country Healthcare, Inc. (CA2/5 B337435 6/13/25) Arbitration | Unconscionability
Under California law, an adhesive agreement to arbitrate is unconscionable if it (1) compels arbitration of claims more likely to be brought by the weaker party but exempts from arbitration claims that are more likely to be brought by the stronger party and (2) requires the weaker party to consent to an injunction in the stronger party’s favor and waives the statutory bond requirement for such an injunction. Alberto v. Cambrian Homecare (2023) 91 Cal.App.5th 482, held that an employer cannot sidestep this law by requiring its employees to sign two contracts—one that purports to require arbitration of all claims on equal terms, and a second that supersedes the first contract and has terms favoring the employer. Here, the appellate court followed Alberto and published its decision to reject further defenses raised by the employer.

Velarde v. Monroe Operations, LLC (CA4/3 G063626 6/6/25) Arbitration | Procedural and Substantive Unconscionability
Velarde filed a lawsuit alleging discrimination, retaliation, and violation of whistleblower protections by her employer, Newport Healthcare (a subsidiary of Monroe Operations). Newport moved to compel arbitration. The trial court denied the motion. The appellate court affirmed. The court found the arbitration agreement was procedurally unconscionable because it was an adhesive contract buried in a stack of 31 documents to be signed as quickly as possible while a human resources manager waited, before Velarde could start work that same day. In response to Velarde’s statements that she was uncomfortable signing the arbitration agreement because she did not understand it, the HR manager made false representations about the agreement that directly contradicted its terms. The court found these misrepresentations rendered the agreement substantively unconscionable.

Schuman v. Microchip Tech. Inc. (9th Cir. 24-2624, 24-2978 6/5/25) ERISA
In anticipation of a merger, Amtel Corp. created an ERISA-governed benefits Plan for employees to receive severance in the event they were fired by the acquiring company. After Microchip acquired Amtel, it fired the named plaintiffs without cause and offered them significantly lower benefits than promised in the Plan in exchange for a release of all potential claims. The district court entered judgment in favor of defendants and certified for review the question of what legal test should apply in determining the enforceability of the releases signed by class members. The appellate court laid out nine factors to be considered in determining whether the waiver was knowing and voluntary, including “whether the employee’s release was induced by improper conduct on the fiduciary’s part.” The court remanded for application of the factors.

Catholic Charities Bureau, Inc. v. Wisconsin Labor & Industry Review Comm’n (US 24–154 per curiam 6/5/25) Unemployment Compensation Taxes | First Amendment
Wisconsin law exempts from payment of unemployment taxes nonprofit organizations that are “operated primarily for religious purposes” and “operated, supervised, controlled, or principally supported by a church.” Petitioners sought this exemption as organizations controlled by the Roman Catholic Diocese of Superior, Wisconsin. The Wisconsin Supreme Court held Petitioners were not “operated primarily for religious purposes” because they neither engaged in proselytization nor limited their charitable services to Catholics. The Supreme Court reversed, holding that the Wisconsin Supreme Court’s interpretation of Wisconsin law violated the First Amendment because it imposes a denominational preference based on whether a particular denomination chooses to proselytize or serve only its co-religionists in its charitable work.

Ames v. Ohio Dept. of Youth Services (US 23–1039 per curiam 6/5/25) Title VII Disparate Treatment
Ames applied for a new management position, but the Department hired a lesbian woman instead. The Department then demoted Ames from her role as a program administrator and hired a gay man to replace her. Ames filed suit under Title VII of the Civil Rights Act of 1964, claiming she was denied the management position and demoted because of her sexual orientation. The district court granted summary judgment to the Department because Ames failed to make a prima facie showing that the Department acted with a discriminatory motive. Specifically, the court found Ames’s complaint deficient because it did not allege any “background circumstances” that would show the Department was a rare employer that discriminated against members of a majority group. The Sixth Circuit affirmed. The Supreme Court reversed, holding that the standard for establishing a prima facie case of discrimination under Title VII is the same whether the plaintiff is a member of a minority or majority group with regard to the protected characteristic.