Tag Archives: wage hour defense

It is not unusual for businesses at risk of employee theft to implement security screenings for employees as they exit the employer’s facilities.  Such screenings are especially common in industries where small, costly items could easily be slipped into a pocket or handbag – jewelry, smartphones, computer chips, etc.

In light of the California Supreme Court’s decision in Frlekin v. Apple, Inc., those security screenings now seem likely to lead to even more litigation wherein employees claim that they were not paid for their time spent waiting to be screened, at least in California.

It’s no secret that many employers have employees sign arbitration agreements with class and collective action waivers in the hopes of avoiding the massive wage-hour lawsuits that have become so prevalent in the past two decades.

Nor is it any secret that, following the U.S. Supreme Court’s decision in Epic Systems affirming that such agreements can be valid, even more employers have chosen to use them with their workforces.

As we recently wrote here, Uber and Postmates (and two of their drivers) to file an eleventh-hour lawsuit seeking to enjoin the enforcement of California’s controversial new independent contractor law – known as AB 5 – against them.

In a significant blow to the challenge to the companies’ challenge to the new law, the court has denied Uber and Postmates’ request for a preliminary injunction to block the enforcement of AB 5 against them.

As we wrote here, United States District Court Judge Kimberly J. Mueller of the Eastern District of California wrote a brief “minute order” explaining that she was issuing a preliminary injunction to halt enforcement of California’s controversial anti-arbitration law, known as AB 51.

The new law, which was set to go into effect on January 1, 2020, would outlaw mandatory arbitration agreements with employees. AB 51 would also prohibit arbitration agreements that would require individuals to take affirmative action to be excluded from arbitration, such as opting out.  The law would also appear to extend to jury waivers and class action waivers. And it would include criminal penalties.

Most employers are well aware that employees must be paid on a “salary basis” to be considered exempt from the overtime requirements of the Fair Labor Standards Act (“FLSA”). This means employees must receive the same amount of pay each week regardless of the amount or quality of work they perform for a given week. Accordingly, exempt employees must be paid their full weekly salary for any week in which they perform work, whether or not the employee has actually worked a full work week. See 29 C.F.R. § 541.602(a)(1).

The California Legislature’s attempt to circumvent both the Federal Arbitration Act (“FAA”) and the Supreme Court’s landmark decision in Epic Systems by crafting a new law prohibiting California employers from requiring employees to enter into arbitration agreements is off to a rocky start in the courts, to say the least.

As we have written here, the day before California’s controversial AB 5 was set to go into effect, U.S. District Court Judge Roger Benitez issued a temporary restraining order to block enforcement of the law as to approximately 70,000 independent truckers.

Subsequently, Judge Benitez granted a preliminary injunction to prevent enforcement of the statute to those truckers.

On Thursday, January 16, 2020, the U.S. Department of Labor’s Wage and Hour Division (“WHD”) published in the Federal Register the much-anticipated Final Rule regarding joint employer status under the Fair Labor Standards Act.  This rule completes the rulemaking process initiated in early April of last year, when WHD published its Notice of Proposed Rulemaking (“NPRM”), which we discussed here.

In its first installment of opinions letters in 2020, the U.S. Department of Labor’s Wage and Hour Division (“WHD”) addressed two issues under the Fair Labor Standards Act (“FLSA”): (i) the salary basis requirements in the context of per-project compensation arrangements and (ii) calculation of overtime pay for employees who receive nondiscretionary lump-sum bonus payments earned over time and not tied to a specific period.  (A third letter, FMLA2020-1-A, considered FMLA requirements vis-à-vis public employees.)  While neither of these FLSA opinion letters addresses controversial or novel issues, they offer useful guidance to employers facing similar scenarios and helpfully reiterate general principles of broad applicability.

As we recently wrote here, on December 29, 2019, just days before California’s new arbitration statute known as AB 51 was to go into effect, a federal judge in the United States District Court of the Eastern District of California granted a temporary restraining order (“TRO”) to enjoin enforcement of AB 51.

The new law, which was set to go into effect on January 1, 2020, would outlaw mandatory arbitration agreements with employees.