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Reverse chronological e-mail alerts prepared for the California Lawyers Association (formerly State Bar of California) Labor & Employment Law Section since 2007, covering California, 9th Circuit and US Supreme Court decisions, and new laws signed by Governor. To subscribe, contact LaborLaw@CLA.Legal.


(See prior archived alerts by clicking on "Blog" under menu. For alerts older than one year, please request under "Contact" tab.)

Ricasa v. Office of Admin. Hearings (CA4/1 D071088, filed 12/17/18, pub. ord. 1/14/19) Public Sector Faculty Demotion/Writ of Administrative Mandate


Southwestern Community College District (District) and its governing board (Board) (together Southwestern) demoted Arlie Ricasa from an academic administrator position to a faculty position on the grounds of moral turpitude, immoral conduct, and unfitness to serve in her then-current role.  Ricasa filed two petitions for writs of administrative mandamus in the trial court seeking, among other things, to set aside the demotion and reinstate her as an academic administrator.


Ricasa appeals from the denial of her petitions, arguing the demotion occurred in violation of the Ralph M. Brown Act (the Brown Act) (Gov. Code, § 54950 et seq.) because Southwestern failed to provide her with 24 hours' notice of the hearing at which it heard charges against her, as required by Government Code section 54957.  Assuming we reject her first argument, she argues that the demotion was unconstitutional because no nexus exists between her alleged misconduct and her fitness to serve as academic administrator.  


Southwestern also appeals, arguing that the trial court made two legal errors when it:  (1) held that Southwestern was required to give 24-hour notice under the Brown Act prior to conducting a closed session at which it voted to initiate disciplinary proceedings, and (2) enjoined Southwestern from committing future Brown Act violations.


We conclude that Southwestern did not violate the Brown Act and that substantial evidence supported Ricasa's demotion.  However, we reverse that part of the judgment enjoining Southwestern from future Brown Act violations.


Duffey v. Tender Heart Home Care Agency (CA1/5152535 1/11/19) Wage & Hour/Common Law Test


Plaintiff Nichelle Duffey (Plaintiff) sued defendant Tender Heart Home Care Agency, LLC (Tender Heart) for, among other claims, failure to pay overtime wages under the Domestic Worker Bill of Rights (Labor Code, §§ 1450 et seq.; DWBR), which requires that domestic work employees receive overtime wages for all hours worked more than nine hours per day or 45 hours per week.  The trial court granted Tender Heart’s motion for summary adjudication on the DWBR cause of action, finding the undisputed facts demonstrated Plaintiff was an independent contractor rather than an employee of Tender Heart for purposes of the DWBR.  We first conclude the trial court erred in exclusively applying the so-called “common law” test set forth in S. G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341 (Borello), to determine the issue.  We next conclude that, under the appropriate tests, there is a dispute of fact as to whether Plaintiff was Tender Heart’s employee.  Accordingly, we reverse and remand.

Henry Schein, Inc. v. Archer & White Sales, Inc. (US 17–1272 1/8/19) Arbitration (applicable to labor and employment cases)


Respondent Archer & White Sales, Inc., sued petitioner Henry Schein, Inc., alleging violations of federal and state antitrust law and seeking both money damages and injunctive relief. The relevant contract between the parties provided for arbitration of any dispute arising under or related to the agreement, except for, among other things, actions seeking injunctive relief. Invoking the Federal Arbitration Act, Schein asked the District Court to refer the matter to arbitration, but Archer & White argued that the dispute was not subject to arbitration because its complaint sought injunctive relief, at least in part. Schein contended that because the rules governing the contract provide that arbitrators have the power to resolve arbitrability questions, an arbitrator—not the court—should decide whether the arbitration agreement applied. Archer & White countered that Schein’s argument for arbitration was wholly groundless, so the District Court could resolve the threshold arbitrability question. The District Court agreed with Archer & White and denied Schein’s motion to compel arbitration. The Fifth Circuit affirmed.


Held: The “wholly groundless” exception to arbitrability is inconsistent with the Federal Arbitration Act and this Court’s precedent. Under the Act, arbitration is a matter of contract, and courts must enforce arbitration contracts according to their terms. Rent-A-Center, West, Inc. v. Jackson, 561 U. S. 63, 67. The parties to such a contract may agree to have an arbitrator decide not only the merits of a particular dispute, but also “ ‘gateway’ questions of ‘arbitrability.’ ” Id., at 68– 69. Therefore, when the parties’ contract delegates the arbitrability question to an arbitrator, a court may not override the contract, even if the court thinks that the arbitrability claim is wholly groundless. That conclusion follows also from this Court’s precedent. See AT&T Technologies, Inc. v. Communications Workers, 475 U. S. 643, 649– 650.


Archer & White’s counterarguments are unpersuasive. First, its argument that §§3 and 4 of the Act should be interpreted to mean that a court must always resolve questions of arbitrability has already been addressed and rejected by this Court. See, e.g., First Options of Chicago, Inc. v. Kaplan, 514 U. S. 938, 944. Second, its argument that §10 of the Act—which provides for back-end judicial review of an arbitrator’s decision if an arbitrator has “exceeded” his or her “powers”—supports the conclusion that the court at the front end should also be able to say that the underlying issue is not arbitrable is inconsistent with the way Congress designed the Act. And it is not this Court’s proper role to redesign the Act. Third, its argument that it would be a waste of the parties’ time and money to send wholly groundless arbitrability questions to an arbitrator ignores the fact that the Act contains no “wholly groundless” exception. This Court may not engraft its own exceptions onto the statutory text. Nor is it likely that the exception would save time and money systemically even if it might do so in some individual cases. Fourth, its argument that the exception is necessary to deter frivolous motions to compel arbitration overstates the potential problem. Arbitrators are already capable of efficiently disposing of frivolous cases and deterring frivolous motions, and such motions do not appear to have caused a substantial problem in those Circuits that have not recognized a “wholly groundless” exception.


The Fifth Circuit may address the question whether the contract at issue in fact delegated the arbitrability question to an arbitrator, as well as other properly preserved arguments, on remand. Pp. 4–8. 878 F. 3d 488, vacated and remanded.


KAVANAUGH, J., delivered the opinion for a unanimous Court.

Internat. Brotherhood of Teamsters v. City of Monterey Park (CA2/7 B282971 1/7/19) Public Contracting


The City of Monterey Park contracts with private companies to operate its municipal bus system.  The City conducted a bid on the contract and gave MV Transportation, the incumbent contractor, a preference under Labor Code section 1072, which requires a public agency conducting a bid for a public transit service contract to give a 10-percent bidding preference to a contractor that, in its bid, agrees to retain the employees of the prior contractor for at least 90 days.  The City also gave a 10-percent preference under section 1072 to First Transit, even though First Transit did not state in its bid it would retain the employees of MV Transportation for at least 90 days.  The City awarded the contract to First Transit.


Three employees of MV Transportation and their union filed a petition for a writ of mandate and a complaint for declaratory relief, alleging the City breached its duty under section 1072 to award the bidding preference only to contractors who declare in their bids they will retain existing employees for at least 90 days.  The trial court found there was no such duty under the statute, sustained the City’s demurrer to the petition and complaint without leave to amend, and entered judgment in favor of the City. 


This appeal raises the issue whether the words “shall declare as part of the bid” in section 1072, subdivision (a), mean the bidder must state in its bid whether it will retain the employees of the prior contractor for 90 days.  It also raises the issue whether, if the public agency (or “awarding authority”) gives the statutory preference to bidders who do not agree in their bids to retain the employees of the prior contractor for at least 90 days, a bidder who makes the commitment is really getting a statutory preference.  We answer these questions yes and no, respectively, and reverse.


Nisei Farmers League v. CA Labor & Workforce Dev. Agency (CA5 F075102 1/4/19) Labor Code section 226.2/Constitutionality


Plaintiffs Nisei Farmers League and California Building Industry Association filed this action in the trial court challenging the constitutional validity of Labor Code section 226.2, a recently enacted law articulating wage requirements applicable where an employer uses a piece-rate method of compensating its employees.  The complaint was brought against the state labor agencies and agency officials responsible for enforcing the wage law (defendants).  In their complaint, plaintiffs alleged among other things that provisions of section 226.2 were so uncertain as to render the statute void for vagueness.  Other constitutional challenges to the validity of section 226.2 were premised on allegations that the statute would be applied retroactively.  Defendants demurred to the complaint, arguing that the wording of section 226.2 was not unconstitutionally vague and that the other constitutional challenges asserted in plaintiffs’ complaint were without merit because the statute was not retroactive.  The trial court agreed with defendants’ analysis, sustained the demurrer without leave to amend, and entered a judgment of dismissal.  In doing so, the trial court also declined to grant plaintiffs’ request for declaratory relief relating to an affirmative defense created by the statute.  Plaintiffs appeal from the judgment.


Based on our review of the pertinent issues, we conclude that plaintiffs failed to allege an adequate basis for finding the statute to be facially unconstitutional.  We also conclude that denial of the declaratory relief requested was appropriate.  Thus, the demurrer was properly sustained without leave to amend.  For these and other reasons more fully explained below, the judgment of the trial court is hereby affirmed.


Furry v. East Bay Publishing  (CA1/1 A151986, filed 12/12/18, pub. ord. 1/4/19) Wage & Hour/Accurate Records


Terry Furry sued his former employers East Bay Express and East Bay Publishing LLC (collectively East Bay) for, among other things, unpaid overtime wages, meal and rest break compensation, and statutory penalties for inaccurate wage statements.  Although the trial court found that East Bay failed to keep accurate records of Furry’s work hours, it concluded that Furry was not entitled to any relief because his testimony was too uncertain to support a just and reasonable inference that he performed work for which he was not paid.  The trial court also found that Furry was provided with uninterrupted meal and rest breaks as required by law.


For the reasons set forth below, we hold that it was error to completely deny Furry relief on his overtime claim, because imprecise evidence by an employee can provide a sufficient basis for damages when the employer fails to keep accurate records of the employee’s work hours.  (Hernandez v. Mendoza (1988) 199 Cal.App.3d 721, 727 (Hernandez).)  We agree, however, that Furry is not entitled to premium or regular pay for missed meal breaks because he failed to demonstrate that East Bay knew or reasonably should have known he was working through authorized meal breaks.  Accordingly, we reverse the judgment in part and remand for further proceedings consistent with this opinion.


Stratton v. Beck (CA2/4  B287001, filed 12/7/18, pub. ord. 1/2/19) Wage & Hour/Attorneys’ Fees and Costs/Labor Code section 98.2(c)


This case began as a dispute over approximately $300 in unpaid wages.  It has since transmogrified into a dispute concerning attorney fees totaling nearly 200 times that amount and is here now for the second time.  In the previous appeal, appellant Thomas Beck challenged the trial court’s award of attorney fees for work that respondent Anthony Stratton’s attorney performed in that forum.  We affirmed the trial court’s ruling, holding that Stratton’s motion for $31,365 in statutory attorney fees was timely and supported by substantial evidence. At the conclusion of our opinion, we stated, “In the interest of justice, the parties are to bear their own costs of appeal.” (Stratton v. Beck (2017) 9 Cal.App.5th 483, 487, 498 (Stratton)). We reiterated that allocation in the ensuing remittitur:  “The parties are to bear their own costs of appeal.”


The parties interpreted this directive differently.  Beck maintained that “costs” included attorney fees on appeal, precluding Stratton from seeking them under Labor Code section 98.2, subdivision (c).  Stratton disagreed and filed a motion in the trial court seeking $114,840 in appellate attorney fees—a lodestar of $57,420, doubled in light of the complexity of the underlying issues.  The trial court awarded Stratton the lodestar and denied Beck’s motion to reconsider or clarify the ruling. It also awarded Stratton an additional $9,020 in fees he incurred opposing the motion to reconsider.


Beck appealed.  He contends that our order on costs deprived the trial court of jurisdiction to entertain Stratton’s motion for appellate attorney fees.  He further argues that the trial court erred in denying his motion to reconsider or clarify, in which he requested a more thorough explanation for the appellate attorney fee award.  We disagree and affirm.


Rymel v. Save Mart Supermarkets (CA3 C085863 12/31/18) Arbitration


Plaintiffs Jose Robles, Christopher Rymel, and David Hagins sued defendant Save Mart Supermarkets, Inc., alleging various state law statutory employment claims.  After successfully moving to sever, Save Mart moved to compel arbitration as to each plaintiff.  The motions were heard together, and the trial court denied the motions by substantively identical orders.  Save Mart timely appealed in each case.  The appeals lie.  (See Code Civ. Proc., § 1294, subd. (a).)  We consolidated the appeals for oral argument and decision and shall affirm the orders denying the motions to compel arbitration.


Donohue v. AMN Services, LLC (CA4/1 D071865M, filed 11/21/18, mod. 12/28/18) Wage and Hour Class Action/Summary Judgment and Adjudication



            It is ordered that the opinion filed herein on November 21, 2018 be modified as follows:

            1.         On page 31, line 4 of footnote 27, "1:24 p.m." is changed to "1:34 p.m.".

            There is no change in the judgment.


Carrington v. Starbucks Corp. (CA4/1 D072392, filed 11/27/18, pub. ord. 12/20/18) PAGA


Kileigh Carrington filed a complaint against her former employer, Starbucks Corporation, asserting a representative cause of action under the Private Attorney General Act (PAGA) (Labor Code, § 2698 et seq.), claiming Starbucks failed to properly provide meal breaks or pay meal period premiums for certain employees in violation of sections 226.7 and 512.  In a bifurcated bench trial on plaintiff's action, the trial court determined Starbucks was liable for these violations and imposed penalties of $150,000, with 75 percent thereof payable to the Labor and Workforce Development Agency (LWDA) and 25 percent payable to Carrington and the employees she represented in the action.  The trial court entered judgment in Carrington's favor.  Starbucks appeals, contending Carrington failed to prove she is an aggrieved employee and failed to prove a representative claim.  We conclude there was no legal error and find that substantial evidence supports the judgment; accordingly, we affirm.


Moreno v. Visser Ranch, Inc. (CA5 F075822 12/20/18) Respondeat Superior/Use of Company Vehicle


Plaintiff was injured while a passenger in a pickup truck involved in a single-vehicle, rollover accident.  Plaintiff sued the driver (his father), the corporation that employed the driver, and an affiliated corporation that owned the vehicle.  Plaintiff alleged the driver was acting in the scope of his employment at the time of the accident and claimed the defendant corporations were vicariously liable under California’s doctrine of respondeat superior.  The defendant corporations obtained summary adjudication of the respondeat superior claim on the ground that the driver, who was returning home late in the evening after attending a family gathering, was not acting in the scope of his employment at the time of the accident. 


Scope of employment is a question of fact.  Here, the evidence shows defendants required the driver to be on call 24 hours a day, seven days a week to respond immediately to cell phone calls for repairs and maintenance needed at the ranches, farms and dairies operated by defendants.  Also, there is conflicting evidence about whether the driver was required to use the company-owned vehicle, which contained tools and spare parts, at all times so he could respond quickly to call for repairs at defendants’ various locations.  Based on this evidence and other details about the driver’s job, a reasonable trier of fact could find the driver was acting within the scope of his employment when the accident occurred.


We publish this decision because it is distinguishable from most other cases involving an employee’s required use of a company-owned vehicle.  Usually, those cases involve an employee who is required to use the vehicle only for the commute to and from work but is not required to use the vehicle while off work.  Here, a trier of fact reasonably could find the driver’s use of the truck for personal travel after work was dictated by the employer’s requirement.  In such circumstances, the risk of the truck’s involvement in an accident is a foreseeable risk that is attributable to the business enterprise under California’s risks-of-the-enterprise principle, which is the primary justification for its respondeat superior doctrine. 


Consequently, responsibility for that risk is best allocated to the enterprise, which is able to spread the risk (and actually did so) by obtaining insurance.


City of San Diego v. Superior Court (CA4/1 D073961 12/19/18) Police Department Internal Investigation/Attorney-Client Privilege/Disqualification


In May 2014 Hoover filed a lawsuit against the City, her employer, alleging claims of employment-related harassment and retaliation.   In particular, she claimed she suffered harassment and retaliation based on complaints she made about perceived investigative failures by the Department's homicide unit, of which she had been a member.  In June 2015, Hoover was represented in her lawsuit by attorney Daniel M. Gilleon. 


In late 2017, Gilleon agreed to represent a different client—the mother of a minor sexual assault victim—in a separate claim against the City.  On behalf of this new client, Gilleon alleged that the Department failed to properly investigate the assault and then covered it up.  Media outlets reported the claim.  In particular, a March 2018 article in the Voice of San Diego referenced a "police report" obtained by the Internet news service.


The Voice of San Diego article prompted an investigation by the Department's internal affairs unit seeking to determine if and how the media obtained a confidential police investigative report.  Suspicion focused on Hoover, and investigators scheduled an interview with her to determine whether she was the source of the leak.  An initial interview was conducted by Sergeants Robert Gassman and John Huys on March 14, 2018.  Hoover was accompanied by her union representative, Officer Mark Brenner.  She was ordered to respond to the investigators' questions and was told at the outset that any refusal to answer could be treated as insubordination, subjecting her to discipline up to and including termination.


Although she had no involvement in the sexual assault case, Hoover admitted to accessing and reviewing the report.  She denied, however, providing the report to or discussing its contents with anyone.  At some point the investigators began to inquire about communications between Hoover and Gilleon.  Brenner objected based on the attorney-client privilege.  Recalling the earlier threats of discipline if she failed to cooperate, Hoover nonetheless began answering the questions.  Brenner again objected and advised Hoover not to answer any further questions about the content of communications with her lawyer.  At that point the investigators took a break and contacted their supervisor; when the questioning resumed they did not make any further inquiries about communications with Gilleon. 


Later that same day, Sergeant Huys contacted Hoover, telling her that the City Attorney's office had concluded that the attorney-client privilege did not preclude questions about her conversations with attorney Gilleon as they related to the sexual assault investigation and the leaked police report.  Hoover was ordered to return for a follow-up interview on March 22.


Meanwhile Gilleon learned of the internal affairs investigation and on March 16 sent an e-mail to Deputy City Attorney Michael J. McGowan complaining about the alleged violation of the attorney-client privilege.  McGowan responded that he had just "inherited" the case from another attorney, but based on "very limited information" he did not believe the questions were sufficiently "related to the lawsuit."  He nonetheless offered to meet with Gilleon before the rescheduled interview to discuss the matter.  Gilleon sent another e-mail, this time also copying the San Diego City Attorney Mara Elliot, warning that if the City proceeded to question Hoover about conversations she had with Gilleon, he would "take immediate legal action including but not limited to not limited to:  1) restraining orders; 2) sanctions motion; 3) motion to disqualify; and 4) a report to the State Bar."  Neither Gilleon nor the City made any attempt to seek input or guidance from the trial court.


Hoover's interview with the same two internal affairs investigators resumed on March 22.  Hoover was accompanied by attorney Rick Pinckard, counsel provided by the police officers' association.  Deputy City Attorney Christina Milligan observed the interview but also engaged with Pinckard in occasional discussions of legal issues regarding the attorney-client privilege.


A transcript of that interview has been filed under seal and is part of the record.  In it Hoover described receiving a group text message from Gilleon that referred to the sexual assault investigation.  She later contacted him by phone about a different issue, but the sexual assault investigation came up during the discussion.  Later, Hoover decided to look at the police report concerning the sexual assault incident out of "professional curiosity."  She printed a copy, read the report, then immediately placed it in a "secured shred bin."  She specifically denied giving a copy of the report to anyone or discussing its contents with anyone, including any member of the press.


When the investigators sought to inquire about the content of the phone conversation with Gilleon that preceded Hoover accessing the report, Pinckard reasserted the attorney-client privilege.  In response to a clarifying question by Deputy City Attorney Milligan, Hoover stated that her lawsuit against the City "absolutely" dealt with claims of negligent investigation and a failure to properly investigate.  Milligan followed up by asking whether the sexual assault investigation was "encompassed" in Hoover's case, to which she replied, "No."  But Pinckard then pointed out that "how that claim might in some way support or relate to the claims that are asserted in her action and any discussions that she's had with her attorney . . . regarding how this incident may or may not fit into that litigation, that would be privileged."


The questioning by the internal affairs officers resumed.  Hoover denied giving Gilleon any information about the sexual assault case.  Sergeant Huys pressed her for details of what information Gilleon provided her during the conversation.  Hoover summarized what she recalled Gilleon telling her, but admitted she had learned a great deal about the sexual assault case from "media reports" and could not be sure which details she first learned from Gilleon.  Huys then asked if and how the sexual assault investigation was related to her case against the City.


Within a few weeks of the March 22 interview, Hoover filed a motion to disqualify the City Attorney in her harassment and retaliation action.  The motion claimed that the internal affairs interview violated both the attorney-client privilege and Rule 2-100, which generally prohibits a lawyer from contacted a litigant known to be represented by counsel.  According to Hoover's motion, the only appropriate remedy was disqualification of the entire Office of the City Attorney.


The trial court agreed.  It found that the City and the City Attorney's office "(1) forced plaintiff to reveal confidential attorney-client communications, and (2) communicated with plaintiff about the subject matter of the litigation without her counsel's consent."  The court rejected the City's argument that the privilege was not violated because the disclosed communications between Gilleon and Hoover did not relate to the lawsuit, noting that a court " 'may not review the contents of a communication to determine whether the attorney-client privilege protects that communication.' "  (DP Pham, LLC v. Cheadle (2016) 246 Cal.App.4th 653, 659.) 


Relying on cases involving the inadvertent disclosure and receipt of privileged information, the court noted that disqualification is often necessary as a prophylactic rule.  In this case, however, the receipt of privileged information was not inadvertent.  Indeed, the court noted, it would have been a simple matter for the City to have raised the issue with the court in an ex parte application before the resumed March 22 interview.  Under these circumstances, disqualification was warranted "to preserve the public's trust in the integrity of the judicial process and to prevent future prejudice to the plaintiff."


After the City filed a petition for writ of mandate/prohibition, we issued an order to show cause.

Biel v. St. James School (9th Cir. 17-55180 12/17/18) Ministerial Exception


The panel reversed the district court’s summary judgment in favor of the defendant and remanded in an employment discrimination action under the Americans with Disabilities Act.


Based on the totality-of-the-circumstances test articulated by the Supreme Court in Hosanna-Tabor Evangelical Lutheran Church & School v. E.E.O.C., 565 U.S. 171 (2012), the panel held that the First Amendment’s ministerial exception to generally applicable employment laws did not bar a teacher’s claim against the Catholic elementary school that terminated her employment. The panel concluded that she did not qualify as a minister for purposes of the exception. The panel considered whether the school held the teacher out as a minister, whether her title reflected ministerial substance and training, whether she held herself out as a minister, and whether her job duties included important religious functions.


Dissenting, Judge Fisher wrote that, considering all of the circumstances of the teacher’s employment, she was a “minister” for the purposes of the ministerial exception because of the substance reflected in her title and the important religious functions she performed.


McCleery v. Allstate Ins. Co. (CA2/1 B282851 12/14/18) Wage and Hour Class Action Certification/Sampling


In this putative class action, property inspectors allege they were engaged by three “service” companies to perform inspections for two major insurers.  The inspectors allege they were in fact employees of the insurers and service companies jointly, and were entitled to but deprived of minimum wages, overtime, meal and rest breaks, reimbursement of expenses, and accurate wage statements.


The inspectors moved for class certification, supported by their expert’s declaration that liability could be determined and damages calculated classwide by way of statistical analyses of results obtained from an anonymous, double-blind survey of a sampling of class members.


The trial court summarily rejected the expert’s plan and denied certification on the ground that the inspectors had failed to show that their status as employees (as opposed to independent contractors) could be established on predominately common proof.


We reversed the order and remanded the matter with a direction, as pertinent here, to evaluate plaintiffs’ proposed sampling plan.  (McCleery v. Allstate Ins. Co. (Feb. 5, 2016, B256374) [nonpub. opn.].)  On remand, plaintiffs offered a trial plan describing their proposal to establish liability and damages by way of an anonymous survey of all class members.  The trial court found common issues existed as to the class members’ employment status.  It further found that plaintiffs’ survey method, although flawed in some respects, was carefully crafted for accuracy.  However, the court found plaintiffs’ trial plan to be unworkable because it failed to address individualized issues and deprived defendants of the ability to assert defenses.  The court therefore again denied certification.


Plaintiffs appeal, contending the trial court applied improper criteria and made incorrect legal assumptions.


We conclude that under the analytic framework promulgated by Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004 (Brinker) and Duran v. U.S. Bank National Assn. (2014) 59 Cal.4th 1 (Duran), the trial court acted within its discretion in denying certification.


Fresno Superior Court v. PERB (CA5 F075363 12/14/18) PERB Authority/Court Personnel Rules


In this original proceeding, the Superior Court of Fresno County (Court) challenges a decision by the Public Employment Relations Board (PERB) that certain Court personnel rules and regulations (Personnel Rules) violate the Trial Court Employment Protection and Governance Act (Trial Court Act) (Gov. Code, § 71600 et seq.) and, thus, constitute unfair practices.  The initial administrative proceedings were brought by Service Employees International Union Local 521 (Union) after Court adopted new Personnel Rules affecting Union members.  Respondent PERB is a quasi-judicial agency of the State of California charged with administering the provisions of the Trial Court Act.  (§ 71639.1.)  Union, the real party in interest, is and at all relevant times has been the “recognized employee organization” representing employees of Court.  (§ 71691, subd. (h).)


The Personnel Rules in question prohibit Court’s employees from (1) wearing clothing or adornments with writings or images, including pins, lanyards and other accessories; (2) soliciting during working hours for any purpose without prior Court approval; (3) distributing literature during nonworking time in working areas; and (4) displaying writings or images not published by Court in work areas visible to the public.  Relevant to the issues raised in this writ, PERB found several aspects of the rules improper with respect to Union members and thus constitute unfair practices.  PERB concluded rules prohibiting employees from wearing certain clothing anywhere in the courthouse and from displaying images that are not published by Court in work areas visible to the public overly broad and interfered with rights protected by the Trial Court Act.  It also determined the restriction on soliciting during work hours and the ban on distributing literature in working areas were ambiguous and overly broad.  Relatedly, PERB considered and upheld its authority to remedy these violations and ordered Court to rescind the rules.


The case now reaches this court via writ proceedings.  Within the many issues raised are important questions regarding Court’s authority to impose workplace rules to ensure Court appears impartial in all cases it hears and PERB’s authority to impose remedies for the perceived violations in Court’s workplace actions.  As set out more fully below, we find Court has a substantial interest in regulating its workforce to ensure that the judicial process appears impartial to all appearing before it.  Under the existing law and the facts presented regarding interactions with the public in the relevant courthouses, this interest is sufficient to justify the broad restrictions on employee clothing adopted in this case.  Furthermore, we conclude, contrary to PERB’s findings, that the bans on soliciting during working hours and displaying images in areas visible to the public are not ambiguous and thus were properly adopted.  However, we do agree with PERB that the regulations prohibiting the distribution of literature in working areas is ambiguous as to the meaning of “working areas.”  In line with this conclusion, we agree with PERB that separation of powers concerns do not prohibit PERB from imposing a remedy with respect to that regulation.


We therefore affirm PERB’s decision invalidating the rule prohibiting the distribution of literature but otherwise set aside PERB’s remaining conclusions.

Local Joint Exec. Bd. v. Mirage Casino-Hotel (9th Cir. 16-16754 12/13/18) Arbitration


The panel reversed the district court’s summary judgment confirming, pursuant to the Labor Management Relations Act, an arbitration award entered in favor of Mirage Casino-Hotel, Inc., on a union’s grievance under the parties’ collective bargaining agreement.


Mirage subcontracted with another company to operate a venue, and the memorandum of agreement provided that the other company would “directly employ” the union’s food and beverage workers and would be responsible for paying their wages and employee benefits. Mirage, however, would control the terms and conditions of employment. The other company soon declared bankruptcy and failed to pay certain benefits before closing. Mirage declined to step in, and the union filed a grievance. The arbitrator ruled that the union’s grievance, filed pursuant to the CBA, was not arbitrable.


The panel explained that the parties’ substantive dispute concerned whether Mirage was obliged under Article 29 of the CBA and the MOA to ensure that the workers received payment for accrued benefits. The dispute was arbitrable if it fell within the arbitration agreement expressed in Article 21 of the CBA. Its arbitrability was to be determined by the arbitrator if the parties “clearly and unmistakably” agreed to submit that question to him. The union’s position would be meritorious if its theory was supported by the CBA and the other evidence.


The panel concluded that the arbitrator conflated these inquiries in concluding that the dispute was not arbitrable because Mirage was not the workers’ employer. The panel held that, under the terms of the CBA, which required Mirage to arbitrate grievances, the dispute was substantively arbitrable. Further, the union’s assent to the arbitrator deciding arbitrability could not be inferred from its post-hearing briefing or its failure to call a halt to the arbitration proceedings and seek judicial review of arbitrability. The panel reversed the district court’s judgment and remanded with instructions to vacate the arbitration award.


Concurring, Judge Owens wrote that, although the dissent reached a more equitable result, the majority’s opinion was more consistent with controlling law.


Dissenting, Judge Friedland wrote that the “clear and unmistakable” test for determining whether a party resisting arbitration has nevertheless consented to having the arbitrator decide substantive arbitrability does not also apply when determining whether a party that initiates arbitration has so consented. Because the union submitted the dispute to arbitration in the first place, Judge Friedland would instead apply traditional standards of waiver to the union’s actions. She would hold that, under those standards, the union waived its objection to the arbitrator’s deciding the substantive arbitrability question.

Gerard v. Orange Coast Mem. Medical Center (SC S241655A 12/10/18) Meal Periods/Health Care Employees


The Labor Code generally provides that employees who work more than five hours must be provided with a 30-minute meal period and that employees who work more than 10 hours must be provided with an additional 30-minute meal period.  (Lab. Code, § 512, subd. (a); all undesignated statutory references are to this code.)  An employee who works no more than six hours may waive the meal period, and an employee who works no more than 12 hours may waive the second meal period.  (Ibid.)  A wage order of the Industrial Welfare Commission (IWC) permits health care employees to waive the second meal period even if they have worked more than 12 hours.  The hospital that is the defendant in this case allowed employees working shifts longer than 12 hours to waive the second meal period, and the employees who are the plaintiffs here waived their second meal periods.  Plaintiffs now claim that the IWC order permitting them to waive second meal periods for shifts greater than 12 hours violates the Labor Code and that the hospital must pay back wages and penalties for unlawfully permitting waiver of the second meal period.  Considering the relevant statutory and regulatory provisions in light of their history, we agree with the Court of Appeal that the IWC order does not violate the Labor Code.


Donohue v. AMN Services, LLC (CA4/1 D071865 11/21/18) Wage and Hour Class Action/Summary Judgment and Adjudication


In this wage and hour class and representative action, the trial court granted a motion for summary judgment brought by defendant AMN Services, LLC (AMN), and denied motions for summary adjudication of one cause of action and one affirmative defense brought by plaintiff Kennedy Donohue, individually and on behalf of five certified plaintiff classes she represents (together Plaintiffs).  In her appeal from the judgment, Donohue challenges the grant of AMN's motion for summary judgment and the denial of her motion for summary adjudication of one of the causes of action.  On appeal, Donohue also challenges what she characterizes as the trial court's "fail[ure] to hear a proper motion for reconsideration" of the summary judgment and summary adjudication rulings.


As we explain, we lack jurisdiction to review the postjudgment order that resulted in the court's decision not to hear Donohue's motion for reconsideration, and in our de novo review of the summary judgment and summary adjudication rulings, we conclude that Donohue did not meet her burden of establishing reversible error.  Accordingly, we affirm the judgment.

Moustafa v. Bd. of Registered Nursing (CA1/1 A150266 12/10/18) Criminal Background/Licensing


Radwa Mohamed Moustafa applied for a license to be a registered nurse and, in the course of doing so, disclosed she had been convicted of four misdemeanors that were subsequently dismissed under Penal Code section 1203.4.  The Board of Registered Nursing (Board) granted her a probationary license as a result of three of those convictions—two for petty theft and one for vandalism—and the conduct that gave rise to them.  Moustafa opposed this restriction and filed a petition for a writ of administrative mandate in the trial court.  The court granted the petition, relying on Business and Professions Code section 480, subdivision (c) (section 480(c)), which bars a licensing board from denying a license “solely on the basis of a conviction that has been dismissed pursuant to Section 1203.4 . . . of the Penal Code.”


On appeal, the Board contends that its decision must be upheld and the trial court erred by granting Moustafa’s petition because (1) section 480(c) applies only when an applicant has a single dismissed conviction; and (2) even if section 480(c) did apply, Moustafa’s license restriction was lawful because of the conduct underlying the convictions.  Although we reject many of the Board’s arguments, we agree that until July 1, 2020, when recent legislation amending section 480 takes effect, the Board may deny or restrict a license based on the conduct underlying a dismissed conviction.  It may do so, however, only when the conduct independently qualifies as a basis for denying a license.  Contrary to the Board’s position, conduct does not necessarily so qualify merely because it involves some act—no matter how minor—of theft, dishonesty, fraud, or deceit.  Instead, conduct so qualifies only if it substantially relates to the applicant’s fitness to practice nursing.  Applying this standard, we conclude that the Board could restrict Moustafa’s license based on the conduct underlying the petty thefts, but not on the conduct underlying the vandalism.  The trial court therefore erred in granting the petition, and we reverse.


City of Petaluma v. Workers' Comp. App. Bd. (CA1/1 A153811 12/10/18) Workers’ Compensation/Apportionment of Prior Disability


In 2004, the Legislature made comprehensive changes to the workers’ compensation law, one of which altered apportionment of permanent disability such that an employer is now liable only for the percentage of disability directly caused by the employment-related injury.  In the instant case, the Qualified Medical Examiner (QME) concluded 85 percent of the claimant’s disability was due to a previously asymptomatic, underlying condition.  The Administrative Law Judge (ALJ), however, determined no portion of the disability should be apportioned to that condition.  The Workers’ Compensation Appeals Board (the Board) affirmed, stating the QME had “confused causation of injury with causation of disability.”  We granted the City’s petition for a writ of review and now annul the decision and order an apportioned award.


GCIU Employer Ret. Fund v. Quad/Graphics (9th Cir. 17-55667 12/7/18) Multiemployer Pension Plan Amendments Act/ Partial Withdrawal


The panel affirmed the district court’s judgment against an employer in an action brought under the Multiemployer Pension Plan Amendments Act of 1980.


The employer withdrew from a multiemployer pension plan after its employees voted to decertify a union as their bargaining representative. Under the terms of a collective bargaining agreement with the union, the employer had been required to contribute to the plan. At issue was whether the plan correctly calculated the employer’s withdrawal liability under the MPPAA. Reviewing an arbitrator’s decision de novo, the district court concluded that the plan’s calculation was correct.


Affirming, the panel held that the plan correctly applied a credit for a prior partial withdrawal under 29 U.S.C. § 1386(b) against the employer’s complete withdrawal before calculating the twenty-year limitation on annual payments provided for in 29 U.S.C. § 1399(c)(1)(B).


The panel addressed other issues in a concurrently-filed memorandum disposition.


ASARCO v. United Steel (9th Cir. 16-16363 12/4/18) Arbitration/CBA No-Add Provision


The panel filed (1) an order withdrawing its opinion and dissenting opinion and denying as moot a petition for rehearing en banc, and (2) a new opinion and new dissenting opinion.


In its new opinion, the panel affirmed the district court’s order affirming an arbitration award in favor of a union, which sought relief concerning a bonus provision in the parties’ collective bargaining agreement.


The employer asserted that the arbitrator reformed the collective bargaining agreement in contravention of a no-add provision in the agreement. The district court held that the arbitrator was authorized to reform the agreement, despite the no-add provision, based on a finding of mutual mistake.


The panel held that the arbitration award drew its essence from the collective bargaining agreement, and the arbitrator did not exceed his authority in reforming the agreement. In addition, the arbitrator’s award did not violate public policy.


Dissenting, Judge Ikuta wrote that, in light of the no-add provision, the arbitrator exceeded his authority under the collective bargaining agreement.


Acosta v. Brain (9th Cir. 16-56532 12/4/18) ERISA


The panel affirmed in part, reversed in part, and vacated in part the district court’s judgment in a civil enforcement action brought by the Secretary of the Department of Labor against Scott Brain, a former trustee, and Melissa Cook and Melissa W. Cook & Associates, PC, former counsel to the Cement Masons Southern California Trust Funds, alleging violations of the Employee Retirement Income Security Act of 1974 (“ERISA”).


The action alleged violations of two sections of ERISA – unlawful retaliation in violation of ERISA section 510, 29 U.S.C. § 1140, and breach of fiduciary duty in violation of ERISA section 404, 29 U.S.C. § 1104. The panel held that the district court did not err in concluding that Brain violated ERISA section 510 by retaliating against whistleblower Cheryle Robbins, the Director of the Trust Funds’ internal Audit and Collections Department.


The panel held that Robbins’s participation in the Department of Labor (“DOL”) investigation of Brain was unmistakably protected activity under ERISA, and constituted an independently sufficient ground for the district court’s conclusion. The panel noted that there was a circuit split on the issue of whether “unsolicited internal complaints” constituted protected activity within the meaning of ERISA section 510, but concluded that the issue of Robbins’s letter-writing being protected activity was immaterial where Robbins’s cooperation with the DOL investigation provided an independent basis for the section 510 claim.


The panel held that the district court did not err in concluding that Robbins’s protected activity was the but-for cause of Robbins being placed on leave. The panel assumed, without deciding, that the higher but-for causation standard applied. The panel held that the fact that Brain was not the ultimate decisionmaker – where a group of trustees were the ones voting to place Robbins on leave – did not immunize him under a “cat’s paw” theory of liability given that Brain was the one who set the vote into motion.


The panel held that the district court erred in concluding that Brain breached his fiduciary duty in violation of ERISA section 404 by placing Robbins on administrative leave. The panel held that the district court erred by not addressing the threshold “two-hat” inquiry of whether Brain was wearing his ERISA fiduciary hat when he took the action alleged in the Secretary of DOL’s complaint. The panel further held that the Secretary’s overbroad use of the phrase “management and administration” – to argue that Brain was acting as an ERISA fiduciary when he caused Robbins to be placed on leave – contravened Supreme Court authority. The panel held that it necessarily followed that the district court erred in concluding that the Cook Defendants violated section 404 by knowingly aiding Brain in violating section 404.


The panel held that the district court erred in basing the permanent injunction on ERISA section 409. The panel held that because section 409 required a breach of fiduciary duty, and because the Secretary did not prove that there was a breach of fiduciary duty in this case, the permanent injunction was vacated in its entirety as to Brain and the Cook Defendants.


The panel held that ERISA section 502(a)(5) did not provide an alternative basis for the district court’s permanent injunction where no aspect of the district court’s injunction redressed or enforced a violation of ERISA section 510. The panel held that the district court did not err in determining that the Cook Defendants were not immune under the attorney immunity doctrine. The panel further held that the Cook Defendants’ remaining arguments were meritless.


Judge Schroeder dissented in part. Judge Schroeder agreed with the majority’s affirmance of the district court’s ruling that Brain violated ERISA by retaliating against Robbins, but disagreed with the majority’s conclusion that the retaliatory act – placing Robbins on administrative leave – was not a breach of Brain’s fiduciary duty, and disagreed with the majority’s decision to vacate the injunction.


Pub. Employment Relations Bd. v. Bellflower Unified School etc. (CA2/4 B288594 12/4/18) PERB/Education Employment Relations Act


Real party in interest California School Employees Association (CSEA), the exclusive representative of most classified employees employed by appellant Bellflower Unified School District (the District), filed two unfair practice charges against appellant in 2010 and 2013 under the Education Employment Relations Act (Govt. Code, § 3540 et seq., EERA).  After notice and hearing, respondent Public Employment Relations Board (PERB or the Board), the agency charged with interpreting and administering the EERA, issued two decisions and orders requiring, among other things, that appellant post two specific notices to its employees.  After the decisions and orders became final in 2015, appellant refused to post the notices, claiming that they were out of date and misleading.  PERB filed the underlying enforcement proceeding, and the trial court issued a writ of mandate instructing appellant to comply with the Board’s two orders.  Appellant appeals, contending that PERB failed to prove the decisions and orders were issued pursuant to its established procedures, and that PERB’s General Counsel abused his discretion under a regulation authorizing him to conduct an investigation or hearing prior to filing an enforcement proceeding.


We find substantial evidence supports the trial court’s conclusion that the decisions and orders were issued pursuant to PERB’s procedures, and that there was no abuse of discretion on the part of the General Counsel.  Accordingly, we affirm.

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