Labor & Employment Law Blog

The California legislative season is in full swing.  Among the proposed bills this year are several involving changes to meal and rest period regulations, some new leave entitlements, and legislation that may affect the hiring and firing process.  We will be monitoring these and other bills throughout the summer as the August 31, 2010 deadline for bill passage approaches. 

AB 482 (Mendoza) Consumer Credit ...

One issue that often arises in litigation over arbitration agreements is “Who gets to decide if the agreement to arbitrate is valid?” This is usually a “gateway issue” for the courts to decide under both the federal and California arbitration statutes. However, sometimes the parties specifically agree that the arbitrator can decide issues of contract validity and enforceability, in order to ensure that their entire dispute is resolved in arbitration.

On June 17, 2010, the United States Supreme Court ruled that a city audit of an employee’s text messages on a city-owned device did not violate the Fourth Amendment.  In City of Ontario v. Quon, the Supreme Court determined that the City of Ontario’s search was reasonable under the narrow factual circumstances of this case. Significantly, however, the Supreme Court declined to address the broader issue of to what extent does an employee have a reasonable expectation of privacy in his electronic communications on employer provided devices.

As we previously reported here, by Executive Order 13496, the Obama administration revoked Executive Order 13201 issued by the Bush administration requiring that providers of goods or services to the executive branch to post a Beck notice informing employees of their rights to not join a union and their right to not pay agency fees associated with the political and other non-representation activities of a union (the so-called "Beck" rule based on a US Supreme Court decision of the same name).  

On June 17, 2010, in  New Process Steel, L.P. v. National Labor Relations Board, the United States Supreme Court dealt a severe blow to the National Labor Relations Board (NLRB) and hundreds of NLRB decisions.  From the period of late 2008 to early 2010, the NLRB operated with a two member quorum.  Three empty seats at the Board remained during this period as appointment packages did not receive Senate confirmation at the end of the Bush Presidency and beginning of the Obama Presidency. The two NLRB members remaining decided to render decisions on cases where they could agree.  Relying upon legal advice that they could render decisions on behalf of the Board with a two member quorum, the two members issued decisions on hundreds of cases involving unfair labor practice and union election issues. 

As we previously reported here, the Los Angeles Times has reported here that the Immigration and Customs Enforcement ("ICE") agency, the largest investigative agency in the Department of Homeland Security ("DHS") is conducting a crackdown on employers that knowingly hire or retain undocumented workers. Alleged violators are being prosecuted in Federal court by the United States Attorney.

AALRR clients have recently had two published rulings by the National Labor Relations Board in which competing unions have disputed work assignments by construction contractors. Where either or both unions to a dispute picket or threaten to picket because of such a dispute, the NLRB can get involved. If the unions involved have not agreed to a different mechanism to resolve such disputes, the NLRB has the legal authority to make a final and binding award of the disputed work.

Awards of backpay in unfair labor practice cases are intended to make whole an employee who suffers a loss of earnings because of an unfair labor practice.  Because awards of backpay are typically limited to an employee's actual loss, an award of backpay is usually offset by any post termination earnings.

As we previously reported here, on May 20, 2010, by a unanimous decision in Martinez v. Corky N. Combs, the California Supreme Court clarified the standard courts must use to determine who is liable as an "employer" for violations of wage and hour laws embodied in Industrial Welfare Commission ("IWC") Wage Orders, including claims for unpaid or underpaid wages.  In that case, the plaintiffs sought to hold customers of the employer liable for their claims for allegedly unpaid wages. The trial court, the Court of Appeal, and the California Supreme Court all rejected the plaintiffs' arguments.

On June 1, 2010, the California Court of Appeal refused to enforce an arbitration agreement to require the arbitration of claims asserted against third parties who did not agree to arbitration. In Valencia v. Smyth, purchasers of real property sued their agent, the property owners and the owners’ broker and listing agent, and three additional parties (two title companies and the trustee of the deed of trust) for fraud, breach of fiduciary duty, negligence, and other claims arising out of the alleged misappropriation of the purchasers’ escrow funds.  The owners attempted to enforce an arbitration agreement entered into with the buyers in which they agreed to arbitrate “any dispute or claim in Law or Equity arising between them out of this Agreement or any resulting transaction,” which neither the title companies nor the trustee were parties to. The trial court had refused to enforce the agreement, and required that all parties be joined in a consolidated judicial proceeding, because the claims against the third parties arose out of the same transaction or series of related transactions and there was a “possibility of conflicting rulings on a common issue of law or fact.”