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Chaplin v. State Personnel Board (CA1/1 A155107 9/23/20) State Personnel Board/Firefighter Discipline
Real party in interest California Department of Forestry and Fire Protection (CAL FIRE) disciplined three of its firefighters (appellants Justin Chaplin, James Michels, and Frank Schonig) for cheating on a promotional exam. One of the men appealed his discipline to respondent California State Personnel Board (Board), but the other two did not. While the one appeal was pending, CAL FIRE substituted new disciplinary notices against all three men, seeking to impose harsher penalties. Over the men’s objections, the Board allowed CAL FIRE to proceed. The firefighters filed a petition for a writ of mandate in the trial court, which the court denied.
We hold that CAL FIRE permissibly substituted its disciplinary notice against the firefighter whose appeal was pending before the Board, but not against the other two, because by statute their discipline became final 30 days after they did not appeal. (Gov. Code, § 19575.) We therefore affirm the trial court’s ruling as to the one firefighter and reverse it as to the other two.
Doe v. Google, Inc. (CA1/4 A157097 9/21/20) PAGA/NLRA/Garmon Exception
Google, Inc. and Alphabet, Inc. (collectively, Google), and Adecco USA, Inc. (Adecco) require their employees to comply with various confidentiality policies. John Doe, David Gudeman, and Paola Correa, who are current and former Google and Adecco employees, sued Google and Adecco under the Labor Code Private Attorneys General Act of 2004 (PAGA) (Lab. Code, § 2698 et seq.), alleging the employers’ confidentiality policies restricted their employees’ speech in violation of California law. The trial court sustained defendants’ demurrers without leave to amend, concluding plaintiffs’ claims were preempted by the National Labor Relations Act (NLRA or Act) (29 U.S.C. § 151 et seq.) under San Diego Bldg. Trades Council v. Garmon (1959) 359 U.S. 236, 244–245 (Garmon). Plaintiffs contend the trial court erred in finding the NLRA preempted their PAGA claims. They further challenge the trial court’s denial of a petition to coordinate this case with another case pending in a different trial court.
We conclude that, although many of plaintiffs’ claims relate to conduct that is arguably within the scope of the NLRA, the claims fall within the local interest exception to Garmon preemption and may therefore go forward. We also conclude that plaintiffs’ challenge to the trial court’s coordination petition is not properly before us. We will therefore reverse the trial court’s orders sustaining defendants’ demurrers without leave to amend and remand for further proceedings.
SEIU Local 121RN v. Los Robles Geg’l Med. Ctr. (9th Cir. 19-55185 9/18/20) Arbitration/Collective Bargaining Agreement
The panel (1) reversed the district court’s order on a motion to compel arbitration of a grievance in which SEIU Local 121RN, who represented registered nurses working at Los Robles Regional Medical Center, asserted that the Hospital placed certain types of patients with nurses who did not have the appropriate training for those patients and that the Hospital was violating nurse-to-patient ratios established by state law; and (2) remanded for further proceedings.
In First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995), the Supreme Court established that a court, not the arbitrator, must make the determination whether the arbitrability of an issue is itself arbitrable when the relevant agreement is silent on that question. In United Bhd. Of Carpenters & Joiners of Am., Local No. 1780 v. Desert Palace, Inc., 94 F.3d 1308 (9th Cir. 1996), this court stated that labor cases are different, and in those cases, an arbitrator should decide arbitrability as long as the agreement includes a broad arbitration clause. Desert Palace distinguished collective bargaining disputes (at issue in Desert Palace) from commercial arbitration disputes (at issue in First Options) on policy grounds, and thus opted not to apply First Options.
Applying Desert Palace, the district court found that the arbitration provision in the parties’ collective bargaining agreement was broad enough to authorize the arbitrator— rather than the court—to determine whether the grievance was arbitrable and therefore granted SEIU’s motion to compel arbitration without reaching the question of whether the grievance was in fact arbitrable.
The panel held that the rationale in Desert Palace, Inc. is “clearly irreconcilable with the reasoning or theory of intervening higher authority” set forth in Granite Rock Co. v. Int’l Bhd. Of Teamsters, 561 U.S. 287 (2010), which expressly rejected the notion that labor arbitration disputes should be analyzed differently than commercial arbitration disputes. The panel concluded that it was therefore not bound by Desert Palace. Absent clear and unmistakable evidence of the parties’ intent to have an arbitrator—rather than the court—decide whether SEIU’s grievance is arbitrable, the panel held that the district court is responsible for deciding that issue. The panel remanded for further proceedings.
Dissenting, Judge Lee agreed with much of the majority’s analysis, but was not convinced that Granite Rock has effectively overruled Desert Palace because they address two related—but distinct—issues. Therefore, Desert Palace should still stand.
Laver v. Credit Suisse Securities (USA) (9th Cir. 18-16328 9/18/20) Arbitration/FINRA Employee Deferred Compensation/Class Waiver
The panel affirmed the district court’s dismissal of a putative class action suit against Credit Suisse Securities, USA in favor of arbitration.
Plaintiff worked as a financial advisor at Credit Suisse Securities, USA (“CSSU”), and brought this putative class action alleging he was owed deferred compensation. CSSU moved to dismiss based on an arbitration clause and general class waiver set forth in an Employee Dispute Resolution Program. The Financial Industry Regulatory Authority (“FINRA”) is a securities industry self-regulatory organization that imposes rules regulating the conduct of its broker-dealer members. CSSU is a FINRA member. Plaintiff argued that FINRA Rule 13204(a)(4) barred CSSU from compelling arbitration of his claims.
The panel rejected plaintiff’s contention that Rule 13204 invalidated the Employee Dispute Resolution Program’s class waiver. Because the class waiver survived, the panel held that plaintiff relinquished his right to bring class claims in any forum. Because plaintiff was left with only individual claims, Rule 13204(a)(4)’s prohibition on enforcing arbitration agreements directed at putative or certified claims had no application here. In accord with the Second Circuit’s decision in Cohen v. UBS Fin. Servs., Inc., 799 F.3d 174 (2d Cir. 2015), the panel held that the district court correctly ordered the parties to arbitrate plaintiff’s remaining individual claims.
Bills Signed by Governor (9/17/20)
AB 685 by Assemblymember Eloise Gómez Reyes (D-San Bernardino) – COVID-19: imminent hazard to employees: exposure: notification: serious violations.
SB 1159 by Senator Jerry Hill (D-San Mateo) – Workers’ compensation: COVID-19: critical workers.
SB 1383 by Senator Hannah-Beth Jackson (D-Santa Barbara) – Unlawful employment practice: California Family Rights Act.
Belgau v. Inslee (9th Cir. 19-35137 9/16/20) Deduction of Union Dues/First Amendment
The panel affirmed the district court’s dismissal of a putative class action brought pursuant to 42 U.S.C. § 1983 alleging that deduction of union dues from plaintiffs’ paychecks violated the First Amendment.
Plaintiffs are public employees who signed membership agreements authorizing Washington state to deduct union dues from their paychecks and transmit them to the Washington Federation of State Employees, AFSCME Council 28 (“WFSE”). They had the option of declining union membership and paying fair-share representation (or agency) fees. After the decision in Janus v. American Federation of State, County, and Municipal Employees, Council 31, 138 S. Ct. 2448 (2018), which held that compelling nonmembers to subsidize union speech is offensive to the First Amendment, employees notified WFSE that they no longer wanted to be union members or pay dues. Per this request, WFSE terminated employees’ union memberships. However, pursuant to the terms of revised membership agreements, Washington continued to deduct union dues from employees’ wages until an irrevocable one-year term expired.
The panel held that plaintiffs’ claims against WFSE failed under § 1983 for lack of state action. The panel held that neither Washington’s role in the alleged unconstitutional conduct nor its relationship with WFSE justified characterizing WFSE as a state actor. At bottom, Washington’s role was to enforce a private agreement. See Roberts v. AT&T Mobility LLC, 877 F.3d 833, 844 (9th Cir. 2017) (“there is no state action simply because the state enforces [a] private agreement”). Because the private dues agreements did not trigger state action and independent constitutional scrutiny, the district court properly dismissed the claims against WFSE.
Addressing whether the claims for prospective relief against Washington were moot, the panel held that the claims fell within the “capable of repetition yet evading review” mootness exception. The panel held that the challenged action, continued payroll deduction of union dues after an employee objects to union membership, capped at a period of one year, was too short for judicial review to run its course.
The panel held that the First Amendment claim for prospective relief against Washington failed because employees affirmatively consented to the deduction of union dues. The panel rejected employees’ argument that the Supreme Court’s decision in Janus voided the commitment they made and now required the state to insist on strict constitutional waivers with respect to deduction of union dues. The panel held that Janus did not extend a First Amendment right to avoid paying union dues, and in no way created a new First Amendment waiver requirement for union members before dues are deducted pursuant to a voluntary agreement. The panel held that neither state law nor the collective bargaining agreement compelled involuntary dues deduction and neither violated the First Amendment. The panel concluded that in the face of plaintiffs’ voluntary agreement to pay union dues and in the absence of any legitimate claim of compulsion, the district court appropriately dismissed the First Amendment claim against Washington.
Aerotek v. Johnson Group Staffing Co. (CA3 C078435 9/15/20) Trade Secrets/Prevailing Party’s Fees
California’s Uniform Trade Secrets Act allows courts to award reasonable attorney fees and costs to the “prevailing party” in certain cases involving bad faith claims. (Civ. Code, § 3426.4.) The issue here concerns the ownership of fees awarded under this statute. Is the prevailing litigant (here, The Johnson Group Staffing Company, Inc.) or the prevailing litigant’s attorney (here, Porter Scott, P.C.) entitled to the fees awarded to the “prevailing party”? We conclude that, absent an enforceable agreement to the contrary, these fees belong to the attorney to the extent they exceed the fees the litigant already paid. We further conclude that, although the parties here entered into a fee agreement, that agreement did not alter the default disposition of fees in favor of the attorney. Because the trial court found likewise, we affirm.
Bills Signed by Governor (9/11/20)
AB 276 by Assemblymember Laura Friedman (D-Glendale) – Personal income taxes: qualified employer plan: loans: CARES Act.
AB 908 by Assemblymember Patrick O’Donnell (D-Long Beach) – Pupils: extracurricular activities: work permits.
AB 1140 by Assemblymember Mark Stone (D-Monterey Bay) – Public Employees’ Retirement System: contracting agencies: consolidation.
AB 1859 by Assemblymember Miguel Santiago (D-Los Angeles) – School district employees: merit systems: appointments.
AB 1945 by Assemblymember Rudy Salas (D-Bakersfield) – Emergency services: first responders.
AB 2143 by Assemblymember Mark Stone (D-Monterey Bay) – Settlement agreements: employment disputes.
AB 3020 by Assemblymember Todd Gloria (D-San Diego) – Unfair Practices Act.
Sanchez v. Martinez (CA3 C083268 9/11/20) Wage and Hour/Calculation of Damages and Penalties
Plaintiffs in this case are five farm laborers who filed suit against Miguel A. Martinez, their former employer, based on alleged violations of various labor laws.
We first considered their claims three years ago in Sanchez et al. v. Martinez (Jan. 12, 2016, C076852) [nonpub. opn.] (Sanchez). In our initial review, we considered plaintiffs’ appeal from a judgment that rejected all their claims against Martinez. Although we affirmed the judgment for the most part, we reversed to allow plaintiffs to proceed on two of their claims—one of which concerned Martinez’s failure to pay plaintiffs for rest periods, and another of which was derivative of their rest-period claim. As we explained, Martinez was obligated to pay his employees for the time they spent on authorized rest periods. But, we found, nothing in the evidence showed he had ever paid his employees for this time. We thus remanded to allow the trial court to determine appropriate damages and penalties based on this failure. After our remand, the trial court did as we directed.
Both parties now raise various challenges to the trial court’s calculation of damages and penalties. Plaintiffs contend the trial court undervalued their damages and wrongly rejected several of their claims for penalties. Martinez, in turn, asserts that insufficient evidence supports the trial court’s calculation of damages and penalties. Because we find none of the parties’ several claims warrants reversal, we affirm the trial court’s decision.
NLRB v. IAB Local 229 (9th Cir. 17-73210 rehrg. en banc denied 9/11/20) NLRA
The panel denied a petition for panel rehearing and denied on behalf of the court a petition for rehearing en banc.
In its opinion, filed October 28, 2019, the panel granted the National Labor Relations Board’s petition for enforcement of its order entered against International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers, Local 229, enjoining Local 229 from committing violations of the National Labor Relations Act (“NLRA”). The Board affirmed the administrative law judge’s finding that Local 229 had violated Section 8(b)(4)(i)(B) of the NLRA by inducing or encouraging Commercial Metals Company’s neutral employees to strike or stop work for the unlawful secondary purpose of furthering Local 229’s primary labor dispute with Western Concrete Pumping. The panel rejected Local 229’s contention that the Board’s application of the NLRA to its conduct punished expressive activity protected by the First Amendment. Specifically, the panel refused to extend the Supreme Court’s decision in Reed v. Town of Gilbert, 135 S. Ct. 2218 (2015), and refused to apply strict scrutiny to the analysis of Section 8(b)(4)(i)(B). The panel explained that Reed involved content-based restrictions in a municipal ordinance regulating signs directed toward the general public, whereas this case involved communications addressed to neutral employees within the tightly regulated contours of labor negotiations. The panel held that the Board reasonably rejected Local 229’s contention that Section 8(c) of the NLRA protected its communications because the Supreme Court has concluded that Section 8(c) does not immunize activities that violate Section 8(b)(4). The panel held that the Board properly rejected the challenges asserted by Local 229 under the Religious Freedom Restoration Act and under the Thirteenth Amendment to the United States Constitution. Finally, the panel held that the language of the Board’s order adequately apprised Local 229 of its notice obligations.
Judge Berzon, joined by Judges Graber, Wardlaw, W. Fletcher, Paez, and Bumatay, dissented from the denial of rehearing en banc because she would hold that the pure speech enjoined in this case was entitled to full First Amendment protection. By declining to undertake any identity-, content-, or viewpoint-based analysis – including the strict scrutiny inquiry those features should have triggered – and instead relying on an inapposite Supreme Court opinion, International Brotherhood of Electrical Workers v. NLRB, 341 U.S. 694 (1951), the panel in this case relegated to second-class constitutional status the right of labor organizations to speak on matters that may concern them greatly.
Judge Bumatay dissented from the denial of rehearing en banc. He agreed with Judge Berzon that the case should have been taken en banc, and wrote separately to emphasize his views on why the Supreme Court’s decision in International Brotherhood of Electrical Workers v. NLRB, 341 U.S. 694 (1951), was not binding in this case.
Bill Signed by Governor (9/11/20)
AB 2147 by Assemblymember Eloise Gomez Reyes (D-San Bernardino) – Convictions: expungement: incarcerated individual hand crews.