$5.0 Million For Financial Media Employees
$3.0 Million For Home Health Aides
$2.5 Million For Misclassified Tech Worker
$1.7 Million For Media Executive Severance
$1.5 Million For Fintech Workers
$1.5 Million For Home Health Aides
$1.0 Million For Baristas at National Chain
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A California appeals court has just ruled to allow a Domino’s sexual harassment claim to proceed, finding that claims against a franchisor for a franchisee supervisor’s actions are not barred by an independent contractor designation. The case in question, Patterson v. Domino’s Pizza LLC, is an example of the greater protections afforded to employees in California working at franchise restaurants against harassment and intimidation at the workplace.

Patterson v. Domino’s Pizza was brought by a 16-year old former employee at a Domino’s franchise in Ventura County, California. The franchise, Domino’s Sui Juris LLC, was among one of the 9,000 such stores making up one of the largest franchise systems in the world. The employee alleged sexual harassment and assault by one of her supervisors at Sui Juris, bringing suit against the Sui Juris franchise, her supervisor and Domino’s Pizza, Inc. Sui Juris declared bankruptcy, leaving Domino’s Inc. the only defendant able to sustain a potentially massive award. The lower court entered summary judgment for Domino’s Pizza Inc., finding that as a franchisor it could not be liable for the torts of its independent contractor franchisee Sui Juris LLC. Patterson appealed, and the California appeals court reversed, finding there to be a triable issue of fact as to whether Domino’s could be liable for the torts of its franchisee Sui Juris LLC.

In finding that franchisor Domino’s Inc. could be liable for the torts of employees at its franchisee store, the California court relied on its earlier precedent for determining vicarious liability for franchisors in the state. California is unique in the nation for its flexibility in determining an independent contractor relationship for franchises. California courts will not rely on a franchisor agreement, but will instead look to the actual control a franchisor has over its franchisee in determining whether the franchisee is an independent contractor.

A California federal judge just certified an overtime pay class action suit against Office Depot last week, exposing the Fortune 500 company to perhaps millions of dollars of liability for failing to include bonus pay in its overtime calculations. The suit, Provine et al v. Office Depot Inc., pending in the Northern District of California court, concerns thousands of workers at the company who received incentive bonus pay in the form of $50 “Bravo Cards.” The federal judge has allowed the suit to continue to determine whether Office Depot violated California and federal labor laws in failing to pay overtime on the 5,940 such cards it gave out. This suit follows a similar case pending in the Central District of California court by workers at Bloomingdale’s who similarly alleged their company failed to include their commissions and other bonus pay in their overtime pay calculation. This Office Depot suit as such stands as an example of a growing issue in California labor law today of the proper way to include bonus pay in overtime calculations.

Provine et al v. Office Depot Inc. was filed by a worker at the Antioch Office Depot, just outside San Francisco, who claims the company violated California labor law and the Fair Labor Standards Act in failing to properly calculate his overtime pay. The dispute centered on Office Depot’s bonus incentive “Bravo Awards” program. In the Bravo Awards program, workers were given $50 based on a monthly lottery of eligible workers who had already received recognition for their hard work that month. As overtime pay is calculated based on a “regular rate” of pay that includes non-discretionary bonuses or commissions, Provine claimed that the $50 he was awarded as part of the program was non-discretionary and should have been included in determining his overtime pay. Provine in his suit also filed on behalf of all other workers who had received Bravo Awards that had similarly not been included in their calculation of overtime pay.

This issue of the proper calculation of bonuses in overtime pay is often overlooked, but it can be costly for both workers and employers. Another recent case in California by a worker at Bloomingdale’s, Johnmohammadi v. Bloomingdale’s, alleged a similar set of facts, citing the company’s failure to include bonus pay in determining the “regular rate” of base pay for its overtime calculations. In the Provine case, Office Depot claimed that it did not make a mistake in not including the bonus incentives in its calculation because the “Bravo Awards” bonuses were discretionary. The California federal court rejected this argument, finding that although the bonuses were discretionary in that managers were able to give them to any workers they wished who fulfilled certain criteria, the fixed amount of $50 for such awards made them no longer so.

Fortune 500 freight company Yellow Transportation Inc., now known as YRC Freight, has settled an $11 million race discrimination suit, as reported this week by the Chicago Sun-Times. This is the second such suit settled by the company in as many years, bringing the total payments by the company for race discrimination in its Chicago branches to $21 million. This suit against Yellow Transportation provides another example of the historical and enduring race discrimination within the trucking industry that is just now being addressed.

The Equal Employment Opportunity Commission filed the suit in 2009 on behalf of 324 workers at the Chicago Ridge branch of the company who they allege faced years of discrimination and harassment because of their race. The EEOC’s complaint alleged that workers at the company’s Chicago Ridge office faced daily discrimination, with hangman’s nooses, racist graffiti and insults common. The complaint also alleged that the company assigned to racial minorities more difficult and time consuming work. The company also allegedly paid racial minorities less and disciplined them more severely than non-minorities for similar infractions.

Yellow Transportation Inc., with over 28,000 employees, is one of the most dominant companies in the trucking industry. As the EEOC in its press release on the settlement noted, the historical and pervasive discrimination in the trucking industry is just now coming into the public spotlight and being addressed. With over 3.2 million truck drivers in the United States, there is still a shortage of workers in the industry, as reported by the New York Times.

Even with recent employment reports showing sluggish job growth, federal unemployment benefits are still slated to run out starting this month, as reported by the Washington Post this week. While most state unemployment benefits provide 26 weeks of unemployment compensation, Congress in response to the recession had also provided an additional 26 weeks of unemployment to workers on behalf of the federal government. From the beginning of the recession to now, Congress has reauthorized the Federal Unemployment Compensation and the Extended Benefits programs over ten times in order to ensure that most Americans have at least a full year of unemployment compensation available to them. While the last reauthorization of the federal benefits was in February, these federal benefits are slated to phase out starting July 1 and without further Congressional action will no longer be available to any worker by December 31 of this year.

What this means is that for workers still facing an unemployment rate of 8.2 percent, unchanged for months, they will no longer have an important security net for them and their families. As the New York Times reported today, the nation added just 80,000 jobs in June, doing little to address the continuing unemployment and underemployment of millions of American workers. And with little hope of an additional stimulus measure passing Congress before the end of the year, these numbers will probably remain unchanged.

The mechanics of the phase out of federal unemployment benefits is simple but devastating for workers. Starting July 1, any worker who loses their job will only be eligible for their state unemployment benefits and there will be no federal benefits available to them if they do not find a job by December 31. Those who do find a job before December 31 will then be eligible for unemployment benefits up to December 29 at a maximum. If Congress does not reauthorize the Federal Unemployment Compensation and Extended Benefits programs, all federal unemployment benefits for any workers at the end of this year will be completely phased out.

K-9 police officer dog workers have filed suit in federal court demanding overtime pay for their work spent at home training and taking care of the police canines. The case in question, Yuhouse & Wilson v. Borough of Wilikinsburg, brings a long-settled issue of overtime law again into the spotlight and demonstrates how many employers, including state and local governments, still do not take seriously some requirements of federal labor and employment law.

Yuhouse & Wilson v. Borough of Wilikinsburg was filed in federal district court by two police officers at the Wilikinsburg Borough police department who claimed they were not paid overtime by their department for the hours they spent at home cleaning, feeding, training and otherwise caring for their K-9 (canine) police dogs. The issue of paying police officers for the time spent caring for their canine dog workers is a settled issue in federal law, ever since the Supreme Court in their 1985 decision in Garcia v. San Antonio Metropolitan Transit Authority set out the requirement for local governments to pay overtime to their eligible public employees for such use of their time.

Under the Fair Labor Standards Act, all non-exempt employees are required to be paid time and a half for hours worked more than 40 in a week. In California, the requirement is even more stringent, with all hours worked over 8 in a day requiring overtime as well. For the police officers in Wilikinsburg, as with most overtime cases, the question is not whether they worked more than 40 hours in a week. It was clear from their records that they spent at least 40 hours a week at the job and the time spent with the canines at home added at least 30 minutes to their workday. Instead, the questions are whether the police officers are exempt employees and whether their training, feeding and caring for their canine dogs is properly “work” under the law.

The Grammy-Award winning singer Celine Dion has just been sued in federal court for refusing to pay overtime to workers at her $20 million Florida mansion, as reported yesterday by the New York Daily News. The suit Sturtevant v. Feeling Productions Inc. and Celine Dion, filed in the District Court of the Southern District of Florida, requests the singer and her record producer husband pay unpaid overtime wages, damages and attorneys’ costs. This suit makes Celine Dion the second high-profile celebrity to be charged with refusing to pay overtime to her workers this year, after Sharon Stone was hit by a similar suit in California last month.

The suit was filed by Keith Sturtevant, a warehouse manager for Celine Dion who also performed work duties at her Florida mansion from March 2009 to June of this year. In the complaint, Sturtevant claims that the singer categorized him as exempt from the overtime provisions of the Fair Labor Standards Act by giving him the title of “warehouse manager” although he was the sole employee at the singer’s warehouse and did not have the power to hire or fire workers. Sturtevant also claims that he spent much of his time working at the singer’s mansion performing such duties as fixing ice makers, cleaning the shutters of her house, building stages and repairing kitchen appliances. He also claims that he was sent on a number of unrelated errands as well. Sturtevant claims that considering the overall character of his work duties, he was only categorized as a “manager” so that Celine Dion could avoid paying him overtime. Sturtevant also claims that other workers for Celine Dion were also miscategorized as independent contractors even though most of their work was at the singer’s mansion and was under her control. He filed suit for himself and on behalf of all these other similarly situated workers for the unpaid overtime wages he claims were due.

This suit in federal court, beyond being an embarrassment for the singer is also evidence of the continuing relevance of the issues of overtime and the categorization of independent contractors in labor and employment law today. Many employers have been miscategorizing their workers as independent contractors or otherwise exempt from the overtime laws for years, but only recently has the issue come into the spotlight as workers around the country have felt the pinch during this economic recession. The Department of Labor and the IRS have responded by warning that they will take a more aggressive stance towards those employers who wrongly categorize their workers as independent contractors. Last September the Department of Labor and the IRS signed a memorandum of understanding agreeing to work together to identify and prosecute employers who wrongly categorize their workers as independent contractors. Since then 13 states have followed suit and agreed to cooperate with the Department of Labor to supply information to identify such employers. Employers who categorize their workers as exempt managers, executives or professionals will also be carefully scrutinized.

Personal trainer jobs have grown exponentially in the past few years, standing out as one of the few areas of growth during the economic recession. The Department of Labor has found that personal trainer jobs grew 44 percent between 2001 and 2011, while job growth overall dropped 1 percent during the same period, as reported today in the New York Times. But while hundreds of thousands of people are flocking to these jobs that have relatively low barriers to entry, they are discovering that there are many legal pitfalls to these otherwise appealing positions. Many of the legal issues that face workers in the personal trainer industry are very complex, and can expose many of these hopeful aspirants to massive personal liability.

Personal trainers must contend with a number of legal issues relating to their liability for client injuries. In the first case, personal trainers must realize that they may face massive liability for any injuries their client’s sustain during their sessions depending on their relevant state laws. In many states, personal trainers may be found negligent for any advice or training they provide to their clients that lead to their being injured. One recent case in Georgia, Guthrie v. Crouser, is a good example of the kinds of cases many personal trainers may face. In that case, a woman alleged that her personal trainer during a session pushed her to exert herself in exercises until after one session she suffered renal failure and had to be put on life support. In her complaint, the woman claimed that she had protested that the exercise routine was too hard, but her trainer pushed on, as reported by a local Atlanta television station. While the Georgia Court found that the plaintiff only suffered $80 in damages, it also awarded her costs, leaving the personal trainer defendant out of pocket for hundreds, if not thousands of dollars.

For California personal trainers, the issue of liability for client injuries is mitigated somewhat by a recent case on the issue. In 2006, a California Appeals Court ruled in Rostai v. Neste Enterprises et al. that personal trainers under California state law could not be liable for negligence for any injuries a client suffers from a too-strenuous workout. In the opinion, the court extended its earlier rulings on the issue of primary assumption of risk, finding that clients assume the risk for the ordinary injuries they may sustain during a workout. As a result personal trainers owe no duty of care to their clients in California. What this case means for California personal trainers is that they will not be held liable for their clients’ injuries sustained during a training session or workout unless they acted intentionally or recklessly in bringing about the injury. In Rostai, the court had been confronted with the case of a man who hired a personal trainer for his workouts at a local Gold’s Gym. The man subsequently sustained a heart attack during his first workout, which he claimed was due to his personal trainer’s negligence in failing to investigate his risk factors before the workout and pushing him too hard even after he complained of loss of breath and exhaustion. The California court applying its new test found that because the personal trainer did not intentionally attempt to injure the man and did not act recklessly in his actions, then he could not be liable for the man’s injuries and granted summary judgment for the personal trainer and gym.

Many deployed reserve soldiers find themselves shut out of their former jobs upon their return from war as reported by MSNBC this week. As more and more veterans find themselves unemployed at higher rates than the general population, currently pending House Bill 3860 proposed by Representative John Garamandi from California’s 10th District, attempts to remedy the situation by closing loopholes that have allowed employers to refuse to rehire reserve soldiers when they return. This Bill will ensure that employers do not circumvent the requirements of the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA).

Even with the protections of USERRA, veterans have found themselves hardest hit during these difficult economic times, posting a 12.7 percent unemployment rate in May compared to the 8.2 percent unemployment of the general population. Returning from war in Iraq or Afghanistan, many veterans find their jobs gone or replaced by overseas workers. This is despite the fact that since the passage of USERRA in 1994, it has been illegal for employers to refuse to rehire deployed National Guard or Reserve veterans upon their return. The House Bill addresses the loophole that many employers have used to avoid their obligations under the law. If House Bill 3860 is signed into law, employers with over 500 workers can no longer claim the “undue hardship” exemption to avoid rehiring returning veterans into their former jobs. This will ensure that employers recognize their obligations to serve and protect those who serve and protect them.

While many employee rights activists are enthusiastic about the proposal of the Bill, not all veterans are in support. The American Legion, which represents 2.4 million veterans, is in full support of the House Bill and has participated in lobbying efforts. The Veterans of Foreign Wars (VFW), however, at 2.1 million has been wary of the effect the bill may have on the initial hiring of Reserve and National Guard members. The VFW has warned that if House Bill 3860 is passed, employers will avoid hiring National Guard and Reserve members in the first place, fearful of their liability if they are deployed and return.

The Air Force is currently considering completely segregating new recruit training by gender in response to recent sexual harassment scandals, as reported today by the Christian Science Monitor. Following allegations of sexual misconduct by male recruit training supervisors who had sexual relationships with and in some cases raped female recruits, the Air Force is considering allowing only female supervisors train new female recruits. If the Air Force ultimately takes this step, it will be an unprecedented move for a military branch that has struggled to integrate women into its ranks.

Air Force General Edward Rice presented this recommendation to the Pentagon this week, as the military is still reeling from the sex scandal. Since June 2011, almost a dozen women in the Air Force have come forward claiming that their basic recruit training supervisors had sex with them, and in one case, raped them. After investigations and a pending trial that has so far procured a number of confessions by the supervisors, the Air Force has begun reevaluating its basic training model in order to avoid similar scandals. In response to the revelations, the Air Force also undertook a survey of women in the Air Force that found that one in five had been sexually assaulted, and of those just one in five reported their assault.

This sexual scandal in the Air Force, though unique because of the openness with which the branch has approached the issue, is still not surprising for the thousands of women across the country who have faced similar situations in non-military environments. The recent Kleiner Perkins Silicon Valley sexual harassment suit demonstrates that it doesn’t matter the industry, women in male-dominated environments often face open discrimination and unlawful sexual harassment every day. For many women, like the women in the Air Force survey, fears of retaliation or hindering their career advancement silences them from sharing their stories of harassment and abuse or filing suit.

A class action suit against Walgreens was just filed by California employees alleging that the company forced them to work off-the-clock without paying them their wages and overtime due. This suit, Hodach et al. v. Walgreen Co., exposes Walgreens to up to tens of millions of dollars in liability for not paying wages and overtime for off-the-clock work for its tens of thousands of workers in its 270 California stores. The case, which has employees alleging that Walgreens forced its workers to have their bags checked at the end of their shifts after they had already punched out, is almost identical to the January 2012 class-action suit against California Forever 21 stores and demonstrates that this issue is an increasingly important one for employees across the state.

Hodach et al. v. Walgreen Co. was filed last month in Sacramento Superior Court and the complaint alleges a number of violations by Walgreens of California labor and business laws. The suit was filed on behalf of all of Walgreens’ hourly workers across the state, although it is not clear if the court will allow class action certification of such a large number of potential plaintiffs. The plaintiffs allege that Walgreens required its employees to undergo security bag checks at the end of each shift, undertaken in order to deter theft of merchandise by the workers. The workers allege that these bag checks took place after they had already punched out, adding 10 and more minutes to their shift that was not paid. The plaintiffs allege that all workers at all Walgreen’s stores across the state were subjected to the same kinds of end-of-shift bag checks and were all similarly wronged by not being paid for the time they spent waiting and having their belongings inspected. Additionally, as most workers had their bags inspected after a full 8 hour shift or had a 40 hour weekly work schedule, the additional time they spent having their bags checked also needed to be paid at the overtime rate of time and a half.

This suit by Walgreens plaintiffs is the second major class-action suit in California this year alleging that workers were not paid for time their belongings were being inspected, as reported by the Los Angeles Times. In January, employees at a Forever 21 store in San Francisco brought a similar class action complaint against the company on behalf of all its thousands of employees across the state who were not paid for the time spent having their bags checked after they had already clocked out. These employees also allege that their bags had to be checked before meal breaks, which added an additional 10 minutes to their shift and also violated California’s laws regarding meal and rest breaks.

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