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Bill Signed by Governor (8/25/16)

 

AB 2780 by Assemblymember Chris Holden (D-Pasadena) – Fair Employment and Housing Council: membership: length of terms.

 

AB 2780, Holden. Fair Employment and Housing Council: membership: length of terms.

Existing law creates the Fair Employment and Housing Council within the Department of Fair Employment and Housing. The council consists of 7 members, appointed by the Governor and confirmed by the Senate, who serve 4-year terms.

 

 

This bill would, beginning with appointments to the council made on or after January 1, 2017, make the terms of 4 of the members 4 years in length and the terms of 3 of the members 2 years in length. The bill would provide that after the terms of these initial appointments expire, members would be appointed to serve 4-year terms. The bill would also provide that vacancies occurring prior to the expiration of the term would be filled by appointment for the unexpired term.

 

Bhd. Of Maint. of Way v. BNSF (9th Cir. 15-56556, 16-55070 8/24/16) Railway Labor Act/Retaliation

 

The panel affirmed the district court’s judgment in favor of an employer on a union’s claim that the employer violated the Railway Labor Act by retaliating against an employee who attempted to file grievances.

 

The panel concluded that the district court’s subsequent entry of final judgment mooted the question of the propriety of a preliminary injunction against a strike. The panel held that the parties’ dispute was “minor,” and therefore subject to mandatory arbitration, because the employer asserted a contractual right to take the contested action of disciplining the employee, and the action was arguably justified by the parties’ collective bargaining agreement.

 

The panel rejected the union’s argument that the distinction between major and minor disputes did not apply because the dispute was not a dispute over enforcement of the collective bargaining agreement, but rather concerned whether the employer’s alleged retaliation undermined the purpose of the Railway Labor Act and the grievance process.

 

http://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/24/15-56556.pdf

 

King Soopers, Inc. and Wendy Geaslin. (NLRB 27–CA– 129598 8/24/16) NLRA/Backpay and Search-for-Work Expenses

 

The primary issue in this case is whether the Board should modify the current make-whole remedy to require respondents to fully compensate discriminatees for search-for-work expenses and expenses incurred in connection with interim employment. The General Counsel urges the Board to discontinue its traditional practice of treating discriminatees’ reasonable search-for-work and interim employment expenses as an offset that reduces the amount of interim earnings deducted from gross backpay, arguing that this approach unfairly forces discriminatees to bear work-related expenses that result directly from a respondent’s unlawful action. The General Counsel instead proposes that these expenses be calculated and paid separately from backpay, regardless of whether the discriminatee received interim earnings. Before considering the General Counsel’s remedial request, we must first decide the merits of the case. For the reasons stated by the judge, we find that the Respondent violated Section 8(a)(1) of the Act by unlawfully interrogating employee Wendy Geaslin about her protected, concerted activity.2 Additionally, as discussed below, we affirm the judge’s conclusions that the Respondent violated Section 8(a)(3) and (1) by twice suspending and discharging Geaslin for engaging in protected, concerted activity. Although our dissenting colleague would find that Geaslin’s first suspension was lawful, the dissent ultimately agrees with all of our other unfair labor practice findings.

 

https://www.nlrb.gov/case/27-CA-129598

 

American Hotels & Lodging Ass’n v. City of Los Angeles (9th Cir. 15-55909 8/23/16) Preemption/Municipal Minimum Wage Ordinance

 

The American Hotel & Lodging Association and Asian American Hotel Owners Association (“the Hotels”) appeal the denial of their motion to preliminarily enjoin the City of Los Angeles (“the City”) from enforcing the Citywide Hotel Worker Minimum Wage Ordinance (“the Wage Ordinance”). The Hotels argue that the entire Wage Ordinance is preempted by federal labor law, referred to as Machinists preemption, because the Ordinance interferes with labor–management relations. The Hotels also argue that the opt-out provision for collective bargaining agreements is independently preempted.

 

The district court concluded that preemption was inapplicable and denied the Hotels’ motion for preliminary injunctive relief. We have jurisdiction pursuant to 28 U.S.C. § 1291. We affirm.

 

http://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/23/15-55909.pdf

 

Tompkins v. 23andMe, Inc. (9th Cir. 14-16405 8/23/16) Arbitration/Unconscionability/CA Law (consumer case applicable to employment arbitration)

 

The panel affirmed the district court’s order enforcing the terms of a Terms of Service agreement, and granting 23andMe, Inc.’s motion to compel arbitration.

 

Plaintiffs are a class of 23andMe customers who purchased a DNA test kit and assented to an online Terms of Service, and they challenged the 23andMe arbitration provision under the California doctrine of unconscionability.

 

The panel held that none of the challenged portions of the arbitration provision, alone or in concert, rendered the arbitration provision unconscionable under current California law.

 

The panel rejected the plaintiffs’ challenges to the arbitration provision. First, concerning the arbitration provision’s prevailing party clause, which provided that the arbitration costs would be borne by the losing party, the panel held that the plaintiffs did not carry their burden of demonstrating unconscionability of the clause where: the bilateral attorneys’ fee shifting clause in the Terms of Service was not unconscionable under California law; and the arbitration fee-shifting provision was not unconscionable under the case-specific standard announced in Sanchez v. Valencia Holding Co., LLC, 61 Cal. 4th 899, 911 (2015). Second, concerning the arbitration provisions’ forum selection clause, which stated that arbitration proceedings would be held in San Francisco, California, the panel held that the plaintiffs had not met their burden of proving that the clause was unreasonable. Third, concerning the clause excluding intellectual property claims from mandatory arbitration, the panel held that plaintiffs had not carried their burden of demonstrating that the exemption was unconscionable under current California law. The panel concluded that the arbitration agreement was valid and enforceable under the Federal Arbitration Act, 9 U.S.C. § 2.

 

The panel also rejected plaintiffs’ challenges to provisions in the Terms of Service not contained within the arbitration clause itself. First, the panel held that the agreement’s one-year statute of limitations did not make the arbitration provision itself unconscionable under California law where California courts afford parties considerable freedom to modify the length of a statute of limitations, and the statute of limitations in the Terms of Service was not unfairly one-sided. Second, the panel held that a provision giving 23andMe a unilateral right to modify the agreement did not make the arbitration provision itself unconscionable. Judge Watford concurred in the judgment. He agreed with the majority that the arbitration provision was valid and enforceable, albeit for different reasons.

 

http://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/23/14-16405.pdf

Trustees of Columbia University in the City of New York and Graduate Workers of Columbia– GWC, UAW (NLRB 02–RC–143012 8/23/16) Graduate Students are Employees

 

The threshold question before us is whether students who perform services at a university in connection with their studies are statutory employees within the meaning of Section 2(3) of the National Labor Relations Act. Here, after a hearing directed by the Board, the Regional Director applied Brown University, 342 NLRB 483 (2004), where the Board found that graduate student assistants were not employees within the meaning of Section 2(3), and dismissed a petition filed by the Graduate Workers of Columbia-GWC, UAW, which seeks to represent both graduate and undergraduate teaching assistants, as well as graduate research assistants. The Board granted review in this case on December 23, 2015, and then issued a notice and invitation to file briefs, identifying the primary issue presented, as well as subsidiary issues that would follow if Brown University were overruled. We have carefully considered the record, the positions of the parties and the amici, the reasoning of the Brown University Board, and the views of our dissenting colleague, who endorses Brown University (as well as advancing arguments of his own).

 

For the reasons that follow, we have decided to overrule Brown University, a sharply-divided decision, which itself overruled an earlier decision, New York University, 332 NLRB 1205 (2000) (NYU). We revisit the Brown University decision not only because, in our view, the Board erred as to a matter of statutory interpretation, but also because of the nature and consequences of that error. The Brown University Board failed to acknowledge that the Act does not speak directly to the issue posed here, which calls on the Board to interpret the language of the statute in light of its policies. The Brown University Board’s decision, in turn, deprived an entire category of workers of the protections of the Act, without a convincing justification in either the statutory language or the policies of the Act.

 

https://www.nlrb.gov/case/02-RC-143012

 

Campaign for Quality Education v. State of California (CA1/3  A134423S, filed 4/20/16, mod. 8/22/16, review denied reposted to include Supreme Court statements upon denial of review) Teacher Assignment/Equal Protection

THE COURT:

 

It is ordered that the opinion filed herein on April 14, 2016, be modified as follows:

 

Page 8, footnote 2, add the following language to the last sentence of the footnote immediately preceding the citations to In re Marriage Cases and White v. Davis:  that affect the very fabric of personnel decisions for teachers throughout California.

Footnote 2 now reads in its entirety:

At the time of trial, defendants were:  The State of California; Edmund G. Brown, Jr., in his official capacity as Governor of California; the California Department of Education (CDE); the State Board of Education; and Tom Torlakson, in his official capacity as State Superintendent of Public Instruction (the State defendants); as well as California Teachers Association and the California Federation of Teachers (the intervener defendants), who were granted leave to intervene as defendants prior to trial.  The State defendants and the intervener defendants filed separate briefs on appeal.  Because the positions taken by the two sets of defendants are, for the most part, essentially identical, we generally refer to defendants collectively in this opinion.  We reject the State defendants’ contention that the governor is an improper defendant.  Because public education is ultimately a state obligation (Butt, supra, 4 Cal.4th 668, 680) and “[t]he supreme executive power of this State is vested in the Governor” (Cal. Const., art. V, § 1), the Governor is a proper defendant in this lawsuit mounting a facial challenge to five statutes of state-wide application that affect the very fabric of personnel decisions for teachers throughout California.  (See also In re Marriage Cases (2008) 43 Cal.4th 757 [Governor named as defendant]; White v. Davis (2003) 30 Cal.4th 528 [same].)

 

This modification does not effect a change in judgment.

http://www.courts.ca.gov/opinions/documents/A134423S.PDF

Vergara v. State of California (CA 2/2 B258589S, filed 5/3/16.  review denied 8/22/16, reposted to include Supreme Court statements upon denial of review) Teacher Assignment/Equal Protection

 

THE COURT:

 

It is ordered that the opinion filed herein on April 14, 2016, be modified as follows:

 

Page 8, footnote 2, add the following language to the last sentence of the footnote immediately preceding the citations to In re Marriage Cases and White v. Davis:  that affect the very fabric of personnel decisions for teachers throughout California.

Footnote 2 now reads in its entirety:

At the time of trial, defendants were:  The State of California; Edmund G. Brown, Jr., in his official capacity as Governor of California; the California Department of Education (CDE); the State Board of Education; and Tom Torlakson, in his official capacity as State Superintendent of Public Instruction (the State defendants); as well as California Teachers Association and the California Federation of Teachers (the intervener defendants), who were granted leave to intervene as defendants prior to trial.  The State defendants and the intervener defendants filed separate briefs on appeal.  Because the positions taken by the two sets of defendants are, for the most part, essentially identical, we generally refer to defendants collectively in this opinion.  We reject the State defendants’ contention that the governor is an improper defendant.  Because public education is ultimately a state obligation (Butt, supra, 4 Cal.4th 668, 680) and “[t]he supreme executive power of this State is vested in the Governor” (Cal. Const., art. V, § 1), the Governor is a proper defendant in this lawsuit mounting a facial challenge to five statutes of state-wide application that affect the very fabric of personnel decisions for teachers throughout California.  (See also In re Marriage Cases (2008) 43 Cal.4th 757 [Governor named as defendant]; White v. Davis (2003) 30 Cal.4th 528 [same].)

This modification does not effect a change in judgment.

http://www.courts.ca.gov/opinions/documents/B258589S.PDF

 

Esparza v. Sand & Sea, Inc. (CA2/4 B268420 8/22/16) Employee Handbook Arbitration Agreement Not Enforceable

 

The question in this case is whether an arbitration provision in an employee handbook is legally enforceable.  The employee handbook containing the arbitration provision included a welcome letter as the first page, which stated, “[T]his handbook is not intended to be a contract (express or implied), nor is it intended to otherwise create any legally enforceable obligations on the part of the Company or its employees.”  The employee signed a form acknowledging she had received the handbook, which mentioned the arbitration provision as one of the “policies, practices, and procedures” of the company.  The acknowledgement form did not state that the employee agreed to the arbitration provision, and expressly recognized that the employee had not read the handbook at the time she signed the form.  Under these circumstances, we find that the arbitration provision in the employee handbook did not create an enforceable agreement to arbitrate.  We therefore affirm the trial court’s denial of the employer’s petition to compel arbitration.

 

http://www.courts.ca.gov/opinions/documents/B268420.PDF

 

Morris B. Silver M.D., Inc. v. Internat. Longshore etc. (CA2/7 B267941 8/22/16) ERISA

 

Morris B. Silver M.D., Inc. (Silver) sued the International Longshore and Warehouse Union-Pacific Maritime Association Welfare Plan (Plan) to recover payment for health care services provided to Plan policyholders.  Silver’s action was dismissed on the ground all of his state law causes of action were preempted by the federal Employee Retirement Income Security Act of 1974 (29 U.S.C. § 1001 et seq.) (ERISA).  We reverse the order dismissing the lawsuit and remand for further proceedings as set forth in this opinion.

 

http://www.courts.ca.gov/opinions/documents/B267941.PDF

 

Mitchell v. State Dept. of Public Health (CA2/4 B265769M, filed 7/27/16, mod. , rehrg. den. 8/22/16) Tolling FEHA Limitation Period/EEOC Investigation

 

THE COURT*

 

           It is ordered that the opinion filed on July 27, 2016, be modified as follows: 

 

            1.  At page 3, second sentence of the second full paragraph, “17” is deleted and replaced with “19.” 

            2.  At page 5, in the first line, “July 9” is deleted and replaced with “July 8.”

            3.  At page 5, in the third line, “17” is deleted and replaced with “19.”  

            4.  At page 9, at the end of the last paragraph after the sentence ending “equitable tolling under Downs,” add as footnote 5 the following footnote, which will require renumbering of all subsequent footnotes:  

                        5After filing our opinion, we received a timely petition for rehearing from the Department.  Its main argument is that our opinion “does not account for the legislative history and intent of Government Code section 12965.”  (Caps. omitted.)  The Department provided several documents described as legislative history materials—not found in the record, which purportedly demonstrate a legislative intent to preclude equitable tolling of the FEHA limitations period beyond the federal right-to-sue period.  None of these is cited by the Department in its briefing.  It does not seek to take judicial notice of these extrinsic materials, nor does it claim the statute is ambiguous.  (See Coso Energy Developers v. County of Inyo (2004) 122 Cal.App.4th 1512, 1524 [a court may consider legislative history if a statute is ambiguous].)  Even were we to consider them, the documents would not alter our analysis.  The statutory language, which is the most reliable indicator of legislative intent (ibid.), is not ambiguous and does not support the Department’s position.

                       

The petition for rehearing is denied.  There is no change in the judgment.

http://www.courts.ca.gov/opinions/documents/B265769M.PDF

 

Liberty Surplus v. Ledesma & Meyer Constr. (9th Cir. 14-56120 8/22/16) Third Party Claims/Employers’ Commercial General Liability

 

Certification to Supreme Court of California

 

The panel certified the following question of law to the Supreme Court of California pursuant to Rule 8.548 of the California Rules of Court: Whether there is an “occurrence” under an employer’s commercial general liability policy when an injured third party brings claims against the employer for the negligent hiring, retention, and supervision of the employee who intentionally injured the third party.

 

ORDER

 

We respectfully request that the Supreme Court of California exercise its discretion to decide the certified question set forth in Part II of this order.

 

http://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/22/14-56120.pdf

 

Morris v. Ernst & Young (9th Cir. 13-16599 8/22/16) Misclassification/FLSA/CA Labor Code/NLRA

 

The panel vacated the district court’s order compelling individual arbitration in an employees’ class action alleging that Ernst &Young misclassified employees to deny overtime wages in violation of the Fair Labor Standards Act and California labor laws.

 

As a condition of employment, the employees were required to sign agreements that contained a “concerted action waiver” requiring the employees to pursue legal claims against Ernst & Young exclusively through arbitration, and arbitrate only as individuals and in “separate proceedings.”

 

The panel held that an employer violates § 7 and § 8 of the National Labor Relations Act by requiring employees to sign an agreement precluding them from bringing, in any forum, a concerted legal claim regarding wages, hours, and terms of conditions of employment. The panel held that Ernst & Young interfered with the employees’ right to engage in concerted activity under the National Labor Relations Act by requiring the employees to resolve all of their legal claims in “separate proceedings.” The panel concluded that the “separate proceedings” terms in the Ernst & Young contracts could not be enforced.

 

The panel held that the Federal Arbitration Act did not dictate a contrary result. The panel held that when an arbitration contract professes to waive a substantive federal right, the savings clause of the Federal Arbitration Act prevents the enforcement of that waiver.

 

The panel vacated the order, and remanded to the district court to determine whether the “separate proceedings” clause was severable from the contract. The panel held that it need not reach plaintiff’s alternative arguments regarding the Norris LaGuardia Act, the Fair Labor Standards Act, or whether Ernst & Young waived its right to arbitration. Judge Ikuta dissented because she believed that the majority’s opinion violated the Federal Arbitration Act’s command to enforce arbitration agreements according to their terms, was directly contrary to Supreme Court precedent, and was on the wrong side of a circuit split.

 

Judge Ikuta concluded that § 7 of the National Labor Relations Act did not prevent the collective action waiver at issue here, and would hold that the employee’s contract must be enforced according to its terms.

 

http://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/22/13-16599.pdf

 

Bills Signed by Governor 8/19/16

 

  • AB 2296 by Assemblymember Evan Low (D-Campbell) – Digital signatures (applicable to DFEH online right-to-sue requests)

 

Existing law, the Uniform Electronic Transactions Act, provides that a record or signature may not be denied legal effect or enforceability solely because it is in electronic form and defines an electronic signature for purposes of the act. Existing provisions of the Government Code authorize the use of a digital signature in any written communication with a public entity, and specifies that in those communications, the use of a digital signature has the same force and effect as the use of a manual signature if it complies with specified requirements.

This bill would express the intent of the Legislature to clarify that a digital signature may be used to satisfy the requirements of an electronic signature under the Uniform Electronic Transactions Act. The bill would, for purposes of the Uniform Electronic Transactions Act, provide that an electronic signature includes a digital signature under the above described provisions of the Government Code and that a digital signature under those provisions is a type of an electronic signature as set forth in the Uniform Electronic Transaction Act. The bill would also revise the above-described provisions of the Government Code by specifying that if a public entity elects to use a digital signature, that meets specified requirements, the digital signature has the same force and effect of a manual signature in any communication with the public entity.

 

  • SB 514  by Senator Joel Anderson (R-Alpine) – California Health Benefit Exchange

 

Existing federal law, the federal Patient Protection and Affordable Care Act (PPACA), enacts various health care coverage market reforms that took effect January 1, 2014. Among other things, PPACA requires each health insurance issuer that offers health insurance coverage in the individual or group market in a state to accept every employer and individual in the state that applies for that coverage and to renew that coverage at the option of the plan sponsor or the individual. PPACA also requires each state to establish an American Health Benefit Exchange that facilitates the purchase of qualified health plans by qualified individuals and qualified small employers, as specified.

 

Existing law establishes the California Health Benefit Exchange (Exchange) within state government, specifies the powers and duties of the board governing the Exchange, and requires the board to facilitate the purchase of qualified health plans through the Exchange by qualified individuals and small employers. Existing law requires the board, among other things, to determine the criteria and process for eligibility, enrollment, and disenrollment of enrollees and potential enrollees in the Exchange and coordinate that process with state and local government entities administering other specified health care coverage programs, as specified.

This bill would prohibit the Exchange from disclosing personal information that was obtained from the application for health care coverage to a certified insurance agent or certified enrollment counselor without the consent of the applicant. The bill would provide that these provisions do not preclude the Exchange from sharing the information of current enrollees or applicants with the same certified enrollment counselor or certified insurance agent of record that provided the applicant assistance with an existing application, or their successor or authorized staff, as specified. The bill would define the term “personal information” for these purposes.

 

This bill would declare that it is to take effect immediately as an urgency statute.

 

McLean v. State of California (SC S221554 en band 8/18/16) Prompt Payment of Final Wages/Retirement

 

Under Labor Code sections 202 and 203, an employer must make prompt payment of the final wages owed to an employee who “quits” his or her employment, or else pay statutory penalties.  In this case, plaintiff Janis S. McLean, a retired deputy attorney general, filed suit against the State of California on behalf of herself and a class of former state employees who, having resigned or retired, did not receive their final wages within the time periods set out in the statute.  We consider two questions arising from McLean’s suit.  First, do sections 202 and 203 apply when employees retire?  Second, is McLean’s suit subject to dismissal on the ground that it was filed against the State of California, rather than the state agency for which she had worked?

 

We conclude, as the Court of Appeal had held, that Labor Code sections 202 and 203 (section 202 & section 203) apply when employees retire from their employment.  We also conclude that McLean’s decision to name the State of California as a defendant rather than the Department of Justice is not a basis for dismissing her suit.  We accordingly affirm the judgment of the Court of Appeal.

 

http://www.courts.ca.gov/opinions/documents/S221554.PDF 

 

Boyle v. Liberty Mut. Ret. Benefit Plan (9th Cir. 13-56330, 13-56412 8/18/16) ERISA/Class Certification

 

The panel affirmed in part and reversed in part the district court’s summary judgment in favor of the defendants in a class action under the Employee Retirement Income Security Act.

 

Plaintiffs alleged that their new employer, which purchased their former employer, told them that they would receive past service credit, under the new employer’s retirement plan, for the time they worked with the former employer.

 

The panel affirmed the district court’s summary judgment on a claim for benefits under 29 U.S.C. § 1132(a)(1)(B). The panel held that the district court applied the correct abuse of

discretion standard of review, and the plaintiffs were not entitled to past service credit under the plain terms of the retirement plan.

 

The panel reversed the district court’s summary judgment on plaintiffs’ claim for equitable relief under § 1132(a)(3). Agreeing with the Eighth Circuit, the panel held that the plaintiffs were not barred from bringing simultaneous claims under § 1132(a)(1)(B) and § 1132(a)(3). Courts have

interpreted Varity Corp. v. Howe, 516 U.S. 489 (1996), to mean that equitable relief under § 1132(a)(3) is not available if § 1132(a)(1)(B) provides an adequate remedy. But under CIGNA Corp. v. Amara, 131 S. Ct. 1866 (2011), § 1132(a)(3) authorizes equitable relief in the form of plan reformation, even if plaintiffs also claim relief under § 1132(a)(1)(B). The panel concluded that in light of Amara, prior Ninth Circuit case law to the contrary was no longer binding. The panel remanded for determinations of fact and equitable relief in the form of reformation and surcharge.

 

The panel affirmed the district court’s summary judgment on a claim that the new employer breached its fiduciary duty to disclose information about past service retirement credit in

its Summary Plan Description. The panel held that the plaintiffs did not prove harm or detrimental reliance. On defendants’ cross-appeal, the panel held that class certification was proper.

 

http://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/18/13-56330.pdf 

 

Young v. REMX (CA1/5  A143786, filed 7/26/16, pub. old. 8/17/16) Arbitration/PAGA Bifurcation

 

In this wage and hour lawsuit, plaintiff Vanessa Young appeals from the trial court’s order compelling arbitration of her individual claims, dismissing her class claims, bifurcating her representative claim pursuant to the Labor Code Private Attorneys General Act of 2004 (PAGA; Lab. Code, § 2698 et seq.), and staying the PAGA claim pending completion of the arbitration on her individual claims.  We conclude the order is nonappealable, and dismiss the appeal.

 

http://www.courts.ca.gov/opinions/documents/A143786.PDF 

 

Marin Assn. of Pub. Emp. v. Marin Co. Emp. Retirement Assn. (CA1/2  A139610 8/17/16) Pension Spiking

 

The practice known as “pension spiking,” by which public employees use various stratagems and ploys to inflate their income and retirement benefits, has long drawn public ire and legislative chagrin.  Effective January 1, 2013, the Legislature amended Government Code section 31461, a provision of the County Employees Retirement Law, with the aim of curtailing pension spiking by excluding specified items from the calculation of retirement income.  A number of individuals currently employed by various governmental entities in the County of Marin, together with a number of organizations representing current county employees, brought suit to halt implementation of the revised formula.  The trial court concluded application of the new formula to current employees did not amount to an unconstitutional impairment of the employees’ contracts, and sustained the pension authority’s general demurrer without leave to amend.

 

After an extensive independent review, we reach the same conclusion and affirm, holding that the Legislature did not act impermissibly by amending section 31461 to exclude specified items and categories of compensation from the calculation of pensions for current employees.  As will be shown, while a public employee does have a “vested right” to a pension, that right is only to a “reasonable” pension—not an immutable entitlement to the most optimal formula of calculating the pension.  And the Legislature may, prior to the employee’s retirement, alter the formula, thereby reducing the anticipated pension.  So long as the Legislature’s modifications do not deprive the employee of a “reasonable” pension, there is no constitutional violation.  Here, the Legislature did not forbid the employer from providing the specified items to an employee as compensation, only the purely prospective inclusion of those items in the computation of the employee’s pension.  Neither the statutory change, nor the implementation of that change by the county pension agency, amounts to an impairment of the employee’s receipt of a “reasonable” pension upon retirement.

 

http://www.courts.ca.gov/opinions/documents/A139610.PDF

Aluma Systems v. Nibbi Bros. (CA1/5  A145734 8/16/16) Employer vs. Contractor Liability

 

Aluma Systems Concrete Construction of California, Inc. (hereafter, Contractor) was sued by employees of respondents Nibbi Bros. Inc., and Nibbi Bros. Associates, Inc. dba Nibbi Concrete (hereafter, Employer), for injuries sustained on the job.  Subsequently, Contractor sued Employer for indemnification based on a specific provision in the parties’ contract.  The trial court sustained Employer’s demurrer to Contractor’s complaint, relying on the allegations in the underlying lawsuit that set forth claims only against Contractor and not against Employer.  Because the allegations in the underlying lawsuit are not determinative of Contractor’s claim for indemnity we reject that analysis, reverse and remand.

 

http://www.courts.ca.gov/opinions/documents/A145734.PDF 

 

Bills Signed by Governor (8/17/16)

 

  • AB 1692 by Assemblymember Susan Bonilla (D-Concord) – County employees' retirement: Contra Costa County

 

The California Public Employees’ Pension Reform Act of 2013 (PEPRA) generally requires a public retirement system, as defined, to modify its pension plan or plans to comply with the act and, among other things, prohibits a public employer that offers a defined benefit pension plan from exceeding specified retirement formulas for new members, as defined. The County Employees Retirement Law of 1937 (CERL) authorizes counties to establish retirement systems pursuant to its provisions in order to provide pension benefits to county and district employees. CERL, among other things, authorizes the Board of Supervisors of Contra Costa County to make a Tier Three retirement plan applicable to certain nonsafety officers and employees for whom the board is the governing body, as specified, and sets forth the terms and conditions of disability retirement allowances for Tier Three members.

 

This bill would authorize the Board of Supervisors of Contra Costa County to apply those terms and conditions to nonsafety officers and employees who are new members subject to the retirement formulas specified in PEPRA and for whom the board is the governing body.

 

  • AB 1918   by Assemblymember Patrick O’Donnell (D-Long Beach) – Teacher credentialing: temporary certificates

 

(1) Existing law authorizes a county board of education or city and county board of education to issue temporary certificates to certified employees whose credentials are being processed by the Commission on Teacher Credentialing. Under existing law, a county board of education or city and county board of education, before issuing a temporary certificate, or a school district, before issuing a temporary certificate of clearance, is required to obtain a criminal record summary about the applicant from the Department of Justice.

 

This bill instead would authorize a county board of education or city and county board of education to issue temporary certificates to certified employees, including individuals certified in another state, whose credentials are being processed by the commission. The bill would require a county board of education or city and county board of education, before issuing a temporary certificate, or a school district, before issuing a temporary certificate of clearance, to instead obtain a certificate of clearance from the commission.

 

(2) Existing law authorizes certain school districts, at their discretion, to provide for the registration of a valid certification or other document authorizing the holder to serve in a position requiring certification qualifications as an employee of the school district.

This bill would prohibit a school district from exercising that authority until the school district has obtained a certificate of clearance from the commission.

 

(3) Existing law authorizes a local educational agency to contract with a nonpublic, nonsectarian school to provide the appropriate special educational facilities, special education, or designated instruction and services required by a pupil with exceptional needs if no appropriate public education program is available.

This bill would authorize a county board of education or city and county board of education to issue temporary certificates to certified employees of nonpublic, nonsectarian schools, including individuals certified in another state, whose credentials are being processed by the commission, as provided. The bill would require a county board of education or city and county board of education, before issuing a temporary certificate, to obtain a certificate of clearance from the commission. The bill would provide that the conditions under which a temporary certificate issued pursuant to these provisions may or shall be revoked, issued, or denied, as applicable, are to be the same for nonpublic, nonsectarian schools as for schools operated by local educational agencies.

 

The bill would require the commission to honor requests to expedite teacher credentialing processing from the State Department of Education on behalf of an applicant employed or seeking employment at a nonpublic, nonsectarian school to the same degree the commission honors requests to expedite the processing of applications for teacher credentialing received from other employing agencies.

 

The bill would require the State Department of Education to recognize all teacher permits, credentials, and certificates issued by the commission or a county board of education or city and county board of education authorized by this bill.

 

The bill would make these provisions inoperative on July 1, 2024, and would repeal them as of January 1, 2025.

 

  • AB 2376  by the Committee on Public Employees, Retirement, and Social Security – County employees’ retirement: Los Angeles County

 

The County Employees Retirement Law of 1937 (CERL) establishes retirement plans, known as Retirement Plan D and Retirement Plan E, that are applicable in the retirement system in Los Angeles County and prescribes procedures for members to transfer between those plans. CERL defines “Retirement Plan E” to mean the noncontributory retirement plan established by specific provisions, and defines “Retirement Plan D” to mean the contributory retirement plan otherwise available to new members of the retirement system on the transfer date.

 

This bill would revise the definition of Retirement Plan D to, instead, refer to the contributory retirement plan otherwise available to members of the system between June 1, 1979, and December 31, 2012, inclusive.

 

CERL provides for the retirement system in Los Angeles County specific ages and pension allowances for normal and early retirement. Under CERL, a member of a CERL retirement system who is eligible to retire at 50 years of age pursuant to specified statute, or who is required to retire because of age while a member of the Public Employees’ Retirement System (PERS), a CERL retirement system in another county, the State Teachers’ Retirement System (STRS), or a retirement system of any other public agency of the state that has established reciprocity with PERS subject to certain conditions, but who cannot retire concurrently from PERS, a CERL retirement system in another county, STRS, or a retirement system of any other public agency of the state that has established reciprocity with PERS subject to certain conditions, is entitled to have final compensation and service determined under specific statutes as if the member had retired concurrently under that other system (concurrent retirement exception). Provisions of CERL specifically applicable to Los Angeles County, among other things, apply reciprocal benefits, including the concurrent retirement exception, to the retirement system in Los Angeles County.

 

This bill would amend provisions of CERL specifically applicable to Los Angeles County to provide that the concurrent retirement exception applies to a member of the retirement system in Los Angeles County eligible to retire at 55 years of age and would state that the amendment is declaratory of existing law.

 

CERL sets forth the membership composition for boards of retirement, as specified. Under that law, the retirement board in specified counties is comprised of 9 members and an alternate member, as specified. That law also authorizes specified counties to appoint an alternate retired member to the office of the 8th member of the board and authorizes the alternate retired member to vote as a member of the board only in the event the 8th member is absent from a board meeting for any cause.

 

This bill would additionally authorize the alternate retired member to vote as a member of the board if the 8th member is present and both the 2nd and 3rd, both the 2nd and 7th, or both the 3rd and 7th members are absent for any cause.

 

Under CERL, except as specified, the management of a retirement system is vested in the board of retirement. CERL authorizes such a board to make regulations not inconsistent with that law, and requires that the regulations include specific provisions, including provisions for the filing of a sworn statement by every person who is or becomes a member, showing date of birth, nature and duration of employment with the county, compensation received, and other information as is required by the board.

 

This bill would authorize those regulations, in lieu of a sworn statement, to provide for the submission by a member’s employer to the retirement association of the information otherwise required in a sworn statement, in a form determined by the retirement association.

 

Laffitte v. Robert Half Internat. (SC S222996 8/11/16) Class Counsel’s Attorney Fees

 

A class action employment lawsuit settled before trial for $19 million, with the agreement that no more than a third of that recovery would go to class counsel as attorney fees.  In seeking the trial court’s approval of the settlement, class counsel sought the maximum fee amount, $6,333,333.33.  After considering information from class counsel on the hours they had worked on the case, applicable hourly fees, the course of the pretrial litigation, and the potential recovery and litigation risks involved in the case, the trial court—over the objection of one class member—approved the settlement and awarded counsel the requested fee.

 

The objecting class member contends the trial court’s award of an attorney fee calculated as a percentage of the settlement amount violates a holding of this court in Serrano v. Priest (1977) 20 Cal.3d 25 (Serrano III), to the effect that every fee award must be calculated on the basis of time spent by the attorney or attorneys on the case.  (See Serrano III, at p. 48, fn. 23.)  We disagree.  Our discussion in Serrano III of how a reasonable attorney fee is calculated was made in connection with an award under the “private attorney general” doctrine.  (See id. at pp. 43–47.)  We clarify today that when an attorney fee is awarded out of a common fund preserved or recovered by means of litigation (see Serrano III, supra, at p. 35), the award is not per se unreasonable merely because it is calculated as a percentage of the common fund.

 

http://www.courts.ca.gov/opinions/documents/S222996.PDF 

 

Stanislaus County Deputy Sheriffs' Assn. v. County of Stanislaus (CA5 F071257 8/11/16) Custodial Deputies/Carrying Concealed Weapons Off Duty

 

The Stanislaus County Deputy Sheriffs’ Association (appellant), on behalf of certain custodial deputies designated as a “peace officer” by Penal Code section 830.1, subdivision (c) (custodial deputies), filed this action in the trial court seeking, among other relief, a judicial declaration that such custodial deputies may lawfully carry concealed firearms while off duty without the necessity of obtaining a permit to carry a concealed weapon.  The current practice of Stanislaus County, Stanislaus County Sheriff’s Department, the Chief Executive Officer of Stanislaus County and the Stanislaus County Sheriff (collectively respondents) is to recognize that a custodial deputy may carry a concealed firearm while off duty only if that deputy has first obtained a license or a permit to carry a concealed weapon.  Appellant maintains that respondents’ practice does not comport with section 25450, which categorically exempts all peace officers listed in section 830.1 from the prohibition against carrying a concealed weapon.  As we explain below, appellant is correct.  Accordingly, we reverse the contrary conclusion and judgment of the trial court and remand the matter back to the trial court with instructions to enter declaratory relief in appellant’s favor consistent with this opinion.

 

http://www.courts.ca.gov/opinions/documents/F071257.PDF

 

Kobold v. Good Samaritan Reg’l Med. Ctr. (9th Cir. 13-35528 8/9/16) § 301 LMRA Preemption

The panel ordered consolidated three appeals involving employees represented by labor unions who sought remedies under state law against their employers; affirmed the district court’s grant of summary judgment to the employer in the first appeal; affirmed in part and reversed and remanded in part in the second appeal; and affirmed in the third appeal.

In all three cases, there was a collective bargaining agreement (“CBA”) between the union and the employer setting out a grievance and arbitration procedure to govern disputes arising under the agreement. And in all three, a grievance was filed but did not provide full relief, prompting the employee to turn to the courts. All the employees initially filed their cases in state court, but the cases were removed to federal court on the basis of preemption under § 301 of the Labor Management Relations Act. In all the cases, the district court denied a motion to remand and held the state law claims preempted.

A state law claim is preempted if it either involves a right conferred upon an employee solely by virtue of a CBA or is substantially dependent on analysis of a CBA.

In the first case, the panel held that assuming Or. Rev. Stat. §§ 652.120 and 652.615 conferred upon a nurse the right to receive premium pay for extra shifts worked, that right was substantially dependent on an analysis of the terms of a CBA in order to determine which shifts qualified for premium pay. Accordingly, the state law claims were preempted by § 301. The plaintiff could not pursue her claims under § 301 because she did not exhaust her remedies under the CBA and did not allege that her union breached its duty of fair representation. In the second case, the panel reversed in part, holding that claims for violation of Or. Rev. Stat. § 652.610(4) (establishing time limits regarding CBA-authorized paycheck deductions) and breach of fiduciary duty were not preempted. The panel affirmed as to a claim for money received. The panel concluded that § 652.610(4) conferred a right independent of the plaintiffs’ rights under a CBA, and this right was not substantially dependent on analysis of the CBA. The breach of fiduciary duty claim also was not preempted,but the claim for money received was not independent of the CBA and therefore was preempted. The panel remanded for the district court to decide whether to exercise supplemental jurisdiction over the non-preempted claims.

In the third case, the panel affirmed the district court’s denial of the plaintiff’s motion to remand and its grant of summary judgment in favor of the defendant. The panel held that judicial estoppel did not bar the plaintiff, a nurse practitioner, from arguing for remand to state court on the ground that a CBA did not govern a credentialing decision because the contrary position had been taken by the plaintiff’s union, not the plaintiff herself, during arbitration. The panel held that in light of the arbitrator’s decision that the credentialing decision must be evaluated under the CBA, the plaintiff’s claim for intentional interference with economic relations arose out of the CBA, and thus was preempted. Affirming the district court’s summary judgment on a non- preempted defamation claim, the panel held that the claim was time-barred.

http://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/09/13-35528.pdf 

 

Bodi v. Shingle Springs Band of Miwok (9th Cir. 14-16121 8/8/16) FMLA/Removal and Tribal Immunity

This appeal requires us to decide whether a federally recognized Indian tribe waives its sovereign immunity from [FMLA] suit by exercising its right to remove to federal court a case filed against it in state court. This question has divided the district courts, and it has been reached by only one of our sister circuits, which held that removal does not, standing alone, waive tribal immunity. See Contour Spa at the Hard Rock, Inc. v. Seminole Tribe of Fla., 692 F.3d 1200, 1206–08 (11th Cir. 2012). We now follow the lead of the Eleventh Circuit and hold that the act of removal does not express the clear and unequivocal waiver that is required for a tribe to relinquish its immunity from suit. Because the district court held otherwise, we reverse.

http://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/08/14-16121.pdf 

 

Stilwell v. City of Williams (9th Cir. 14-15540 8/5/16) ADEA/First Amendment

The panel reversed the district court’s summary judgment and remanded in an action brought by a City of Williams employee who alleged that he was fired for planning to testify against the City in a lawsuit relating to age discrimination.

 

The panel first held that plaintiff was engaged in speech as a citizen for First Amendment purposes because his sworn statements and imminent testimony about the City’s retaliatory conduct were outside the scope of his ordinary job duties and were on a matter of public concern.

 

The panel held that the retaliation provision of the Age Discrimination in Employment Act (ADEA), did not  preclude plaintiff’s 42 U.S.C. § 1983 First Amendment retaliation claim. The panel held that the disparities between the rights and protections of the ADEA’s retaliation provision and the First Amendment as enforced through § 1983 — including differences in who may sue and be sued, the standards for liability, and the damages available — which made the ADEA’s protections narrower than the First Amendment’s in some respects, led the panel to conclude that Congress did not intend to preclude § 1983 First Amendment retaliation suits when it enacted the ADEA.

 

Dissenting, Judge Fernandez stated that this court was bound by Ahlmeyer v. Nev. Sys. of Higher Educ., 555 F.3d 1051, 1057 (9th Cir. 2009), which held that “the ADEA precludes the assertion of age discrimination in employment claims, even those seeking to vindicate constitutional rights,under § 1983.”

http://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/05/14-15540.pdf 

Tibble v. Edison International (9th Cir. 10-56406, 10-56415, order 8/5/16) ERISA/Breach of Fiduciary Duty

Upon the vote of a majority of nonrecused active judges, it is ordered that this case be reheard en banc pursuant to Federal Rule of Appellate Procedure 35(a) and Circuit Rule 35-3. The three-judge panel opinion shall not be cited as precedent by or to any court of the Ninth Circuit.

Judges Bybee, Ikuta and Owens did not participate in the deliberations or vote in this case.

http://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/05/10-56406ebo.pdf 

Morales v. 22nd Dist. Agricultural Assn. (CA4/1 D067247M, filed 7/13/16, mod. 8/5/16)FLSA/Amusement or Recreation Exemption

 

THE COURT:

 

It is ordered that the opinion filed herein on July 13, 2016, be modified as follows:

 

1.  On page 28 of the opinion the last sentence in subpart d, addressing "Appellants' Proposed Special Jury Instruction Number 5" is deleted, and the following inserted: 

On this record, any assumed error in not giving the proposed instruction was not prejudicial.

 

2. On page 44 of the opinion the last sentence of the first paragraph is deleted, and the following inserted: 

As relevant here, it exempts "any employees directly employed by the State or any political subdivision thereof, including any city, county, or special district."  (Cal. Code Regs., tit. 8, § 11100(1)(C).)

 

There is no change in judgment.

 

The petitions for rehearing are denied.

 

http://www.courts.ca.gov/opinions/documents/D067247M.PDF

 

CALIFORNIA CASE LAW ALERT