The Goldstein Law Firm, P.C.

 The Goldstein Law Firm

Mid August 2011 Newsletter

1. I.                   The Goldstein Firm Holds 35^th Annual Labor and Employment Law Seminar: “Back to Basics – Understanding Labor and Employment Law and Protecting Your Organization”

The Goldstein Law Firm will hold its 35^th Annual Labor and Employment Law Seminar from 8 a.m. - 12 p.m. on Wednesday, October 19, 2011, at the Cerritos Center for the Performing Arts, located at 12700 Center Court Drive, Cerritos, California 90703.

Seminar Topics will include the following: (1) Have economic conditions and the wide spread use of the Internet and Social Media changed the basics of hiring, firing, and the legal protections for business reputation and trade secrets?; (2) How to protect and defend your organization from Plaintiffs’ lawyers targeting your organization for a costly wage and hour class action lawsuit; and (3) New developments in federal and state labor and employment laws that you should be aware of, including how to defend your organization from an unwanted union organizing campaign that will use the National Labor Relations Board’s new rules to unionize your employees and harm your business.

To attend our firm’s October 19, 2011 Seminar, please complete the Attendance Form on the last page of this Newsletter and fax the Attendance Form to The Goldstein Law Firm. Fax No. (310) 282-8070 or Email to cgoldstein@gpfirm.com

II.        Can Employers Require Job Applicants to Disclose their Social Network Accounts such as Facebook and Make Personnel Decisions Based on What They Find?

            Recently, it was reported that an employer who thought he found a superstar job applicant to fill the position of Chief Financial Officer made a job offer to the applicant and before the job applicant started work, the employer was shocked to learn that the prospective employee had a serious cocaine addiction problem. How did the employer learn this information? Was it from a drug test or a background check or the usual way in which employers check the references of job applicants? No. The employer learned of the employee's “love of cocaine” from the employee’s own Facebook page. The prospective employee had posted numerous references to her love of cocaine on her Facebook page. Needless to say the employer withdrew the job offer.

Had the employer hired this job applicant as its Chief Financial Officer the employer could have suffered serious consequences. Do employers have the legal right to request that prospective employees provide employers with access to their social media accounts?  In California, where there is an express right to privacy embodied in the California constitution, the answer may be that an employer would be violating the job applicant’s right to privacy by requesting this information as a condition of being considered for employment because access to the applicant’s social media account would disclose private information that the applicant only wished to be disclose to his or her friends and not to the general public. 

At present the law is unsettled in this area on the right of the employer to make a hiring decision based on all legally obtainable information and the right of the job applicant to maintain his or her zone of privacy. If you request information about a job applicant’s social media accounts and request access to them, you should be aware that the law is presently unsettled in this area and you could be subject to a lawsuit for breach of the applicant’s constitutional right of privacy, invasion of privacy and other related claims.

1. III.             Court of Appeals Rules That After-Acquired Evidence of Employee’s Fake Social Security and Alien Registration Card Legally Supports Employer’s Reason for Not Re-Hiring Employee and Denial of FEHA Discrimination Claim

            In Salas v. Sierra Chemical 2011 DJDAR 11941, the Third District Court of Appeals ruled that the after-acquired evidence doctrine operates as a complete or partial defense to an allegedly discriminatory termination or refusal to hire.

In this case Sierra Chemical refused to rehire Salas and Salas claimed that his seasonal lay off was retribution for his previous workers compensation claim. Salas claimed that he was first employed in 2003 by Sierra Chemical and laid off as part of Sierra Chemical’s seasonal layoff and then recalled to work. Salas claimed that in August of 2006, he injured his back while stacking crates and was placed on light duty that included: (1) no lifting over 10-15 pounds; (2) no prolonged sitting; (3) no prolonged standing or walking; and (4) limited bending, twisting or stopping at the waist. Sierra Chemical accommodated these restrictions by allowing Salas to sweep the work area, rinse empty containers, and perform other production line duties that did not require lifting creates. When Salas provided his supervisor Huizar with his doctor’s release in June 2006, Salas was returned to full duty. In August 2006, Salas again injured his back while stacking crates and was placed on the same restrictions. He was then laid off as part of Sierra Chemical’s annual reduction in production staff.

            In May 2007 Sierra Chemical sent Salas a letter that Sierra Chemical was recalling employees who had been laid off the previous year. The letter instructed Salas to contact Huizar to make arrangements for him to return to work. According to Huizar he was told by Salas that he did not have a doctor’s release, but was sure that he would receive a doctor’s release following his appointment in June 2007.  Huizar agreed to hold Salas’ job open until Salas received the release, and Huizar stated that he never heard back from Salas. Salas claimed that Huizar contacted him in March 2007 and asked whether he was “100% recovered” from his back injury and Salas informed Huizar that he was “not completely healed” to which Huizar responded that allowing him to return to work would violate Sierra Chemical’s policies. Salas claimed that Huizar said that he wanted to work with Salas, but only if he was, “fine one hundred per cent well with his back.” Salas did not return to work.

            Instead Salas filed a Department of Fair Employment & Housing complaint against Sierra Chemical for disability discrimination based on Sierra Chemical’s refusal to rehire Salas. Following the subsequent lawsuit and appeal that followed, the Court of Appeals found that Salas misrepresented a job qualification imposed by the federal government, i.e. possessing a valid Social Security number that belonged to someone else; and therefore Salas was not lawfully qualified for the job. Further, Salas placed Sierra Chemical in the position of submitting a perjurious I-9 form and filing inaccurate returns with the Internal Revenue Service and Social Security Administration. In these circumstances, the Court reasoned that because Salas could not have been legally hired in the first place because he possessed an invalid Social Security number that belonged to someone else, Salas should have no recourse for an allegedly wrongful failure to hire.

The Salas Case and Tips for Employers

1. The Salas case does not permit employers to legally fire employees who they believe may have provided false or fraudulent documents and I-9 forms.
2. However, if you learn that an employee has used false or fraudulent documents to support their I-9 form and claim to be legally entitled to work in the U.S., you have a duty to investigate this claim or require the employee to provide you with proof that the documentation is not false.
3. If you are presently the subject of a lawsuit or an administrative charge for discrimination for failure to return an employee to his or job following an illness or injury, and you later acquire evidence that the employee was not entitled to be hired in the first place, you can use the Salas case as a complete or partial defense.
4. You can contact The Goldstein Law Firm for more information on the legal implications and practice application of the Salas case.

IV.       The California Supreme Court Determines that Out-of-State Employees Who Perform Work in California are Subject to the California Wage and Hour Laws

In Sullivan v. Oracle Corporation, the California Supreme Court decided in a recent ruling advising the U.S. Ninth Circuit Court of Appeals, that out-of-state employees who work in California are entitled to the same protections afforded to California employees by the California wage and hour laws.

Sullivan was a former instructor who worked for Oracle to train customers on how to use the company’s products. During his employment, he worked 74 days in California, but resided in Colorado and worked outside of California. He and his fellow instructors brought a class action lawsuit against Oracle based on the company’s failure to pay them in accordance with California’s strict overtime and other wage and hour laws while they were working in California. The California Supreme Court cited the language of the California wage and hour laws as covering “any work” in excess of 8 hours a day and 40 hours in any one work week and stated that the work “shall be compensated at the rate of no less than time and one half times the regular rate of pay”.  The Court further held that any employee receiving less than the legal overtime compensation applicable to the employee is entitled to recover the unpaid balance in a civil action against the employer and that Labor Code Section 1171 confirms that California employment laws apply to “all individuals” employed in California. 

How Does the Oracle Case Affect Your Business?

1. Do not assume that just because an employee is domiciled in another state that he or she is only subject to that state’s wage and hour laws, federal law, and the Fair Labor Standards Act.
2. If you have non-exempt employees who are domiciled in another State, but who perform substantial work in California, the Oracle case would entitle these employees to all of the protections of the stringent California wage and hour laws.
3. Make certain that you maintain accurate wage and hour records for your non-California non exempt employees when they perform work in California.
4. If employees who you consider exempt under the laws of the other states work in California for any extended period of time, you should determine whether their job duties meet the stringent test for “exemption” under California law.
5. If employees who are exempt under federal law and the state where they reside in do not meet California’s strict exemption laws, you can either significantly restrict the time that the employee works in California (unlike Sullivan who worked 74 days in California) or attempt to avoid altogether any potential wage and hour liability by not having the employee work in California.

V.        The Wage and Hour Class Action Virus is Still Loose in the Land – How to Protect Your Company

For many years we have advised our private sector clients about how they could comply with the stringent California Wage and Hour statutes and have also advised our public sector clients on how they could comply with the federal Fair Labor Standards Act and avoid costly class action lawsuits.  Since Attorneys were given the right under the California Private Attorney General Act to collect part of the penalties that would be imposed on employers for certain violations of the Labor Code, the filing of wage and hour class action lawsuits has accelerated.

Law firms that represent employees in wage and hour lawsuits are aggressively soliciting your present and former employees through social networks and other means to find some substantial legal weakness in your wage and hour policies. In fact, one firm has a large billboard in downtown Los Angeles at 4^th Street and Hill Streets soliciting wage and hour claims. Other law firms have easily accessible websites that ask employees “whether they are being taken advantage of by their employer who is not paying them for all of their work time or are denying them overtime merely because they are being paid a salary.”

The best defense to a class action is to have The Goldstein Law Firm perform a wage and hour audit before you are ever sued. As your attorneys our audit and recommendations are protected by the Attorney-Client privilege.

Protecting Your Organization from Costly and Uninsurable Wage & Hour Class Actions

1.         Make certain that your employees are properly classified as exempt and non-exempt from overtime.

2.         There are basically 4 types of employees who are exempt from overtime whether or not the employee is paid a salary. They are executive/managerial employees; administrative employees; outside sales employees; and professional employees.

3.         Determining who is exempt and not exempt must be done with knowledge not only of an employee’s job title and job duties; but also knowledge of what the employee actually does.

4.         California law on who is exempt is stricter than federal law. Under federal law if you supervise two (2) or more employees flipping hamburgers and you, as their supervisor also flip hamburgers, you are probably exempt from the Fair Labor Standards Act’s wage and hour rules. However, under California law, you would not be exempt unless you spent over 50% of your time performing managerial job duties instead of flipping hamburgers.

5.         You as the employer have the duty under the law to maintain accurate time records. Make certain that these records are maintained and make certain that the employee certifies that they are accurate.

6.         Make certain that the ½ hour meal period and two (2) ten (10) minute breaks for an employee who works an eight (8) hour shift are properly documented and that these files are stored in a safe place.

7.         Make certain that you comply with California Labor Code Section 2802’s requirement that employees be reimbursed for expenses incurred in the performance of duties on behalf of the Employer.

8.         Clarify any policies in your employee handbook or elsewhere that could be interpreted as violating the California Wage Orders and/or other Labor Code provisions.

9.         Any wage and hour audits conducted by a third party should be conducted by a licensed California attorney so that the results of the audit are protected by the Attorney-Client privilege.

10.       If you find any violation of the wage and hour laws and/or California Labor Code Section 2802, immediately take corrective action and secure a properly drafted release of claims from the affected employees.

The Legal Practice Areas of the Goldstein Law Firm

Employment Law     Wage and Hour Law     Labor Law     Shareholder Disputes

Business Litigation     Corporate Law     Corporate Investigations     Appellate Law

Wrongful Death     Training & Workshops     Workers Compensation     EDD Appeals

Sexual Harassment Law       Discrimination Law       Disability Law               Serious Willful Claims

Labor Code 132(a) Claims      Wrongful Death/Substantial Injury Claims   Cal/Fed OSHA