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Archive for the ‘Employment Law Blog – CA’ Category

READY TO RE-OPEN? Be Aware of California’s New Right-of-Recall Law and Implications for Employers in the Hospitality, Event Center, Airport, Private Club, and Commercial Property Service Industries

Posted on: June 22nd, 2021

By: Mandy Hexom

On April 16, 2021, Governor Newson signed into law a right to notice and recall of certain employees in the hospitality, event center, airport, private club, and commercial property service industries who were laid off due to the effects of the COVID-19 pandemic. This new law is set forth in California Labor Code Section 2810.8, which became effective immediately and does not expire until December 31, 2024.

What businesses or employers must comply?

  1. Hotel Employers
  2. Event Center Employers
  3. Airport Service Providers
  4. Airport Hospitality Employers
  5. Private Club Employers
  6. Commercial Property Service Providers

What if the ownership, organization, or location of the business changed?

Even if the ownership or organization of the business changed, if the business still operates the same or similar operations as before the COVID-19 state of emergency, the business must comply with this new law. The same is true if the business moved offices or locations.

Requirements of the Right-to-Recall Law

  1. Covered Employees: This law applies to laid-off workers that performed at least two hours of work during a six month period (including leave and vacation time), in the 12 months preceding January 1, 2020, that were terminated or separated due to a reason related to the COVID-19 pandemic and not due to a disciplinary reason. The employee is qualified if the employee held the same or similar position at the time of the COVID-19 lay-off.
  2. Opening a Position and Notice: Within five business days of establishing a position, an employer shall offer its laid-off employees in writing (by personal service or by mail to last known address and by email and text message, if possible), all job positions that become available for which the employee is qualified. The employer must provide at least five business days’ notice to the employee to accept or reject the position.
  3. Multiple Employees for One Position: If more than one laid-off employee qualifies for an open position, the position should be simultaneously and conditionally offered to each qualified employee. The conditional offers should indicate that the employee with the longest length of service gets priority, if accepted.
  4. Written Notice When Laid-Off Employee Not Hired: An employer that does not recall a laid-off employee on the grounds of lack of qualifications and instead hires a non-laid-off employee, written notice must be provided within 30 days including the length of service of the employee hired and all reasons for the decision.
  5. Recordkeeping: Employers must retain records for at least three years of the employees (i) full legal name; (ii) job classification at time of lay-off; (iii) date of hire; (iv) last known residential address, email, and telephone number; and (v) copies of written notices and communications regarding the lay-off and offers of employment.

How is the Right-to-Recall Law Enforced?

Non-compliance with Labor Code Section 2810.8 will give the former employee a right to file a complaint with the Division of Labor Standards Enforcement. A private right of action to file a lawsuit in court is not permitted. An aggrieved employee can recover front pay, back pay, lost benefits, and/or reinstatement if the employee prevails.

Depending on how many employees are covered within the business, civil monetary penalties ($100) and liquidated damages ($500) per employee for each day the law is violated until the violation is cured can be enormous.

However, there may still be a right to file a lawsuit for certain aggrieved employees. Check your local ordinances as cities or counties in San Diego, Carlsbad, Los Angeles, Pasadena, Oakland, Santa Clara, and San Francisco have also passed similar local laws. These local versions of the Right-to-Recall may permit an aggrieved employee to file a lawsuit in court.

For covered employers, carefully read and follow the requirements of Labor Code Section 2810.8. Click the following link for the full text of Labor Code Section 2810.8: https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?sectionNum=2810.8.&nodeTreePath=4.2.3&lawCode=LAB

If you have any questions, please contact Mandy Hexom at [email protected] or 619-515-5403.

New COVID-19 Notice Requirements for California Employers

Posted on: January 12th, 2021

By: Chelsea Whelan

The new year ushers in new rules for California employers receiving notice of potential COVID-19 exposure in the workplace. California Labor Code section 6409.6 became effective January 1 this year following the passage of Assembly Bill 685 and will sunset on January 1, 2023. Section 6409.6 requires employers provide written notice within one business day to employees potentially exposed to COVID-19 in the workplace. 

What Constitutes “Notice of Potential Exposure”?

Section 6509.6 defines notice of potential exposure as exposure to a “qualifying individual”. A “qualifying individual” is defined as an individual who has been diagnosed, tested positive for or died from COVID-19, or anyone subject to a COVID-19-related order to isolate by a public health official. (Cal. Lab. Code section 6509.6(d)(4).) Accordingly, section 6509.6(d)(3) defines notice of potential exposure to COVID-19 as notice either that an employee is a qualifying individual or that an employee was exposed to a qualifying individual at the workplace. 

Written Notice Requirements

In order to comply with section 6509.6, employers notified of potential exposure to COVID-19 in the workplace must provide written notice to all employees, as well as the employers of subcontracted employees, who were on the premises at the same worksite as a qualifying individual within the infectious period. The notice can be sent via email, text or personal service if it can reasonably be anticipated to be received by the employee within one business day of sending. Also, the notice must be in English or the language understood by the majority of employees. The following must be included in a written notice:

  • Information regarding COVID-19-related benefits an employee might be entitled to under federal, state or local law, including, but not limited to workers’ compensation and options for exposed employees, including COVID-19-related leave, company sick leave, state-mandated leave, supplemental sick leave, or negotiated leave provisions.
  • Notice of antidiscrimination and antiretaliation protections for employees disclosing a positive COVID-19 test or diagnosis.
  • Notice of the disinfection and safety the employer plans to implement and complete per the guidelines of the federal Centers for Disease Control.

As described in the notice requirements above, section 6409.6 contains antiretaliation and antidiscrimination protections for workers disclosing a positive COVID-19 test, diagnosis or order to quarantine or isolate and allows for the Department of Labor Standards Enforcement to issue citations and penalties for violation of the statute.

Section 6409.6 also requires employers to report a COVID-19 outbreak to the State Department of Public Health within 48 hours. What constitutes an outbreak is defined by the State Department of Public Health.

If you have questions or would like more information, please contact Chelsea Whelan at [email protected].

Additional Information:

FMG has formed a Coronavirus Task Force to provide up-to-the-minute information, strategic advice, and practical solutions for our clients.  Our group is an interdisciplinary team of attorneys who can address the multitude of legal issues arising out of the coronavirus pandemic, including issues related to Healthcare, Product Liability, Tort Liability, Data Privacy, and Cyber and Local Governments.  For more information about the Task Force, click here.

You can also contact your FMG relationship partner or email the team with any questions at [email protected].

**DISCLAIMER:  The attorneys at Freeman Mathis & Gary, LLP (“FMG”) have been working hard to produce educational content to address issues arising from the concern over COVID-19.  The webinars and our written material have produced many questions. Some we have been able to answer, but many we cannot without a specific legal engagement.  We can only give legal advice to clients.  Please be aware that your attendance at one of our webinars or receipt of our written material does not establish an attorney-client relationship between you and FMG.  An attorney-client relationship will not exist unless and until an FMG partner expressly and explicitly states IN WRITING that FMG will undertake an attorney-client relationship with you, after ascertaining that the firm does not have any legal conflicts of interest.  As a result, you should not transmit any personal or confidential information to FMG unless we have entered into a formal written agreement with you.  We will continue to produce education content for the public, but we must point out that none of our webinars, articles, blog posts, or other similar material constitutes legal advice, does not create an attorney client relationship and you cannot rely on it as such.  We hope you will continue to take advantage of the conferences and materials that may pertain to your work or interests.**

Uber and Lyft Drive Prop 22 Home in California

Posted on: November 17th, 2020

By: Adam Khan

On November 3, 2020, California voters resoundingly passed Proposition 22, delivering Uber and Lyft a big victory, and labor unions a setback. 

Prior to Prop 22, AB5 expanded the California Supreme Court’s decision in Dynamex Operations West, Inc. v. Superior Court. Specifically, AB5 applied Dynamex’s “ABC test” to both California Wage Orders and the California Labor Code, creating a presumption that workers in California were employees, not independent contractors, unless an employer could satisfy the three-part ABC test. Under the ABC test, workers are presumed to be employees unless the employer can show: (A) the company does not control or direct what the worker does, either by contract or in actual practice; (B) the worker performs tasks outside of the hiring entity’s usual course of business; and (C) the worker is engaged in an independently established trade, occupation, or business.

Prop 22 exempts rideshare and delivery companies from Dynamex’s ABC test. However, the new law comes with certain requirements, including:

  • Earnings Guarantee: Rideshare and delivery companies must pay 120% of the local minimum wage, plus 30 cents per mile (adjusted for inflation) for “engaged” driving time (i.e., time spent actively driving, not waiting). 
  • Healthcare Subsidies: For drivers working 15-25 hours per week, employers must pay greater than or equal to 50% of the average employer contribution toward a Covered California Plan. For drivers working over 25 hours per week, employers must pay greater than or equal to 100% of the average employer contribution toward a Covered California Plan.
  • Loss and Liability Insurance: Companies must carry, provide, or make available occupational accident insurance to cover medical expenses (up to at least $1,000,000) and lost income (equal to 66% of the driver’s average weekly earnings) resulting from injuries suffered when the driver is on the company’s platform. 
  • AntiDiscrimination and Public Safety: Prop 22 prohibits workplace discrimination, and requires companies to (1) develop sexual harassment policies; (2) conduct criminal background checks; and (3) mandate safety training for drivers.

Prop 22 can only be amended if proposed changes are consistent with the new law’s purpose, and supported by seven-eighths of lawmakers favoring the amendment.

Prop 22’s passage will likely elicit other industries to campaign for independent contractor classification. Some industries have already done so. AB 2257, which passed last September, exempted musicians, fine artists, freelance writers, photographers, and translators from being classified as employees, deeming them instead independent contractors. California can expect other industries to similarly pursue independent contractor status to avoid high costs associated with hiring employees.

If you have questions or would like more information, please contact Adam Khan at [email protected].

Californians Will Soon Receive Their Supplemental $300 A Week Unemployment Benefits

Posted on: September 8th, 2020

By: Michelle Harrington

California has secured $4.5 billion from the Lost Wages Assistance Program (LWAP) that will result in a $300 per week boost in unemployment benefits to millions of unemployed people in California impacted by the Coronavirus pandemic. The funding was made possible through an executive order signed by President Donald Trump approximately a week after Congress’s Coronavirus relief measures expired in July, cutting off an extra $600 per week in unemployment payments for millions of Americans. Individuals who are currently eligible to receive at least $100 per week in unemployment benefits from the state may also now qualify for an additional $300 weekly supplement, paid for by the federal agency in charge of disaster relief, the Federal Emergency Management Agency (FEMA).

FEMA has been authorized to work with all states and pay up to $300 per week in extra unemployment benefits to eligible recipients on top of the unemployment benefits already being paid by the states. The extra $300 payments have been approved for only three weeks and are retroactive to the week beginning August 1, with the possibility for an extension if funds are available. 

It has been up to the states to apply through FEMA for the LWAP funding.  As of August 31, approximately three dozen states have applied and been approved. According to news reports and state unemployment websites, a handful of states including Arizona, Louisiana, and Missouri have already begun sending out the extra $300 payments to eligible residents. 

When Will Californians Receive the Supplemental $300?

California’s Employment Development Department (EDD) announced that it will start processing payments beginning the week of September 7. 

The first phase covers people who previously provided information that they were unemployed due to a COVID-19 related reason on their initial application and have already received their regular state or federal unemployment payments for benefit weeks between July 26 and August 15.

The second phase will cover people who did not have the opportunity to indicate they were unemployed due to a COVID-19 reason on their initial application and still meet the minimum $100 weekly benefit amount eligibility requirement.

The EDD has indicated it will send notifications to people in the second phase, asking them to complete a one-time self-certification if they are unemployed due to disruptions caused by COVID-19. Notifications will be sent by email, text message or mail starting in mid-September.

Who Is Eligible?

The EDD lists two specific requirements for individuals to receive the LWAP payments:

  1. currently eligible to receive at least $100 per week in benefits, and
  2. who have provided a self-certification that they are unemployed or partially unemployed due to disruptions caused by COVID-19.

What Do Californians Have To Do To Get the Supplemental $300?

Individuals who are eligible to receive the LWAP payments should automatically receive them from the EDD, much like the earlier $600 federal unemployment supplement. 

If you have questions or would like more information, please contact Michelle Harrington at [email protected]

9th Circuit Holds Amazon’s Last-Mile Delivery Drivers are Exempt from Arbitration

Posted on: August 21st, 2020

By: Josue Aparicio[1]

On Wednesday, the Ninth Circuit Court of Appeals held that Amazon’s delivery drivers are exempt from the Federal Arbitration Act (“FAA”) because they are transportation workers “engaged in interstate commerce.”

The decision is a huge loss for e-commerce giant, Amazon.com, who is facing several class action lawsuits arising from its “Amazon Flex” program; a delivery service platform in which Amazon contracts with a fleet of on-demand, gig economy workers to perform “last mile” deliveries of Amazon packages. Like many gig workers, Amazon’s so-called “flex drivers” are classified as independent contractors, perform deliveries using their personal vehicles, and follow assigned delivery routes provided by the Amazon Flex smartphone application.

In a 2-1 decision, a divided Ninth Circuit panel affirmed the lower court’s ruling that denied Amazon’s motion to compel arbitration of its flex drivers’ wage and hour class action.[2] Contrary to Amazon’s contentions, the court found the flex drivers did not have to physically cross state lines to be “engaged in interstate commerce” or to fall within the FAA’s so-called “transportation workers” exemption. In the court’s view, since Amazon is “one of the world’s largest online retailers” in the business of shipping goods worldwide, its delivery drivers are “engaged in interstate commerce” through their participation in delivering packages that travel through the “stream of interstate commerce.”

Rittmann v. Amazon.Com, Inc.

In 2016, flex drivers filed a nationwide class and collective action against Amazon.com, alleging the company misclassified them as independent contractors thereby denying them the benefits and protections of state and federal labor laws.

In response, Amazon moved to compel arbitration of the plaintiffs’ individual claims based on an arbitration provision within the terms of service of the Amazon Flex mobile app, which flex drivers must agree to before they can sign up for the Amazon Flex program. Importantly, the terms of service expressly state that the agreement is governed by the laws of the state of Washington, except for the arbitration provision which is governed exclusively by the Federal Arbitration Act (“FAA”).

In April 2019, Judge Coughenour of the U.S. Federal District Court for the Western District of Washington denied Amazon’s motion and concluded that flex drivers fall within the “transportation worker” exemption to the FAA because they deliver goods shipped from across the country.[3] Consequently, since the FAA did not apply and the parties expressly contracted that Washington law could not apply, the district court invalidated the arbitration agreement because it was unclear what law would apply or if the parties even intended to arbitrate disputes in the event the FAA did not apply. Amazon appealed the ruling to the Ninth Circuit.

The Ninth Circuit’s Interpretation of the Transportation Worker Exemption

While the FAA applies broadly to arbitration agreements and reflects a liberal policy favoring arbitration, Section 1 of the statute renders its enforcement provisions inapplicable to “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.”[4] The U.S. Supreme Court in its 2001 landmark decision, Circuit City Stores, Inc. v. Adams, construed the language in Section 1 narrowly to apply exclusively to “transportation workers.”[5] However, the Court never defined the term “transportation worker,” and since then, state and federal courts have struggled to determine which “class of workers” fall within the ambit of the exemption.

On appeal, Amazon challenged the district court’s ruling by asserting that its flex drivers are exclusively “engaged in local, intrastate activities” because they do not cross state lines when performing deliveries. According to Amazon, a worker must physically cross state lines in the course of making deliveries to be “engaged in foreign or interstate commerce” for the exemption to apply.

The Ninth Circuit majority disagreed and held that crossing state lines is not a necessary condition for the application of the transportation worker exemption. In the court’s view, an interstate transaction between Amazon and a customer does not conclude until the package reaches its intended destination. Accordingly, when an Amazon package travels interstate and is held locally in an Amazon warehouse, the interstate journey of the package does not “come to rest” until it is delivered to the intended recipient. Therefore, even though flex drivers only pick up packages from local Amazon warehouses and deliver them “purely intrastate” to a customer’s home, the driver is “engaged in interstate commerce” by performing the last leg or “last mile” of the interstate journey. Based on this reasoning, the Ninth Circuit held that flex drivers are exempt from the FAA under the transportation worker exemption.

In affirming the lower court’s ruling, the Ninth Circuit also agreed that since the FAA does not apply and the contract terms state Washington law cannot apply to the arbitration provision, there is no valid arbitration agreement between the parties.

However, in a 36-page dissenting opinion, Judge Daniel Bress criticized the majority opinion for creating further uncertainty around the interpretation of the “transportation worker” exemption, “as well as inequities among delivery workers who are similarly situated.” In his view, to be “engaged in interstate commerce” the delivery driver “must belong to a ‘class of workers’ that crosses state lines in the course of making deliveries,” otherwise what should be a narrow exemption “could broadly include anyone who delivers goods between any two locations.”

This ruling comes just a month after the First Circuit Court of Appeals also rejected Amazon’s motion to compel arbitration in a lawsuit involving a putative class of flex drivers from Massachusetts who similarly allege Amazon misclassified them as independent contractors.[6]

Employer Takeaways

Recent federal appellate court decisions have certainly expanded the “class of workers” exempt from the FAA. In addition to the Ninth and First Circuit’s inclusion of “last-mile” delivery drivers, the Third Circuit recently expanded the exemption to include workers who transport passengers, such as ride sharing companies, Uber and Lyft.[7]

On the other hand, the Ninth Circuit’s Rittmann decision made clear that individuals delivering food or meals for companies like DoorDash, GrubHub and Postmates are not “engaged in interstate commerce.” In the court’s view, there is an important distinction between making local deliveries of goods that have arrived at a local restaurant and whose continuous interstate journey is broken, as opposed to the packages delivered by Amazon’s flex drivers, which are often shipped from out of state and do not end their interstate journey until they reach the intended consumer.

If you have questions or would like more information, please contact Josue Aparicio at [email protected].


[1] Josue Aparicio is an Attorney with Freeman, Mathis & Gary LLP who specializes in worker misclassification claims under California law. (https://www.fmglaw.com/attorney_bio.php?id=408)

[2] Rittmann v. Amazon.com, Inc. (9th Cir. 2020), Case No. 19-35381.

[3] Rittmann v. Amazon.com, Inc. (W.D.Wash. 2019) 383 F. Supp. 3d 1196.

[4] 9 U.S.C. § 1 (emphasis added).

[5] Circuit City Stores, Inc. v. Adams (2001) 532 U.S. 105, 118-119.

[6] Waithaka v. Amazon.com, Inc. (1st Cir. 2020) 966 F.3d 10.

[7] Singh v. Uber Techs., Inc. (3d Cir. 2019) 939 F.3d 210, 219; Cunningham v. Lyft, Inc. (D.Mass. March 27, 2020) Case No. 1:19-cv-11974.