California Wage Laws Apply to Non-California Residents Working Temporarily In The State -- Sullivan v. Oracle

As the "global economy" becomes more fluid it is increasingly common for employees to cross borders for short-term assignments.  This can lead to confusion concerning the proper calculation of wages for these assignments  -- e.g., should it be based on the law where the work is performed, or where the employee lives?

In Sullivan v. Oracle the California Supreme Court has clarified that California's overtime rules apply to anyone performing work within the state, regardless of their state of residency or how long they may be working in California. 

Although the Court's ruling is technically limited to overtime rules the same analysis would necessarily also apply to most other Labor Code protections.  Thus, employers and workers alike should assume that the provisions of the Labor Code will generally govern any work performed in California. 

In a secondary part of the decision the Court also held that plaintiffs could not use California's unfair competition law ("UCL") to recover overtime payments which were earned under federal law in another state.  That would be stretching the long arm of California law a bit too far.

 

 

2(b) or Not 2(b)?: Dukes v. Wal-Mart Closes the Gap Between Class Certification under Rule 23(b)(2) and (b)(3)

As widely reported, the U.S. Supreme Court held in Dukes v. Wal-Mart that the Title VII gender discrimination claims of 1.5 million employees were far too diverse to be decided on a class-wide basis.  While the result is hardly surprising, the opinion is notable because it substantially revises the standards applicable to class certification under Rule 23(b)(2).

(b)(2) vs. (b)(3) 

To briefly summarize, Rule 23 is the statute governing class certification in federal court.  Subsection (b)(2) of the Rule provides an easier path to certification where a class is seeking mainly equitable or injunctive relief.  By contrast, claims for money damages must normally be certified under subsection (b)(3), which requires additional proof that common issues "predominate" over individual issues and that a class action is the "superior" method of deciding the claims.

As originally enacted, Title VII provided only for equitable remedies (back pay and front pay were available but were deemed to be equitable substitutes for reinstatement).  For many years Title VII claims were thus commonly certified under the relaxed standard of Rule 23(b)(2).  This became much less common however after Title VII was amended in 1991 to allow for emotional distress and punitive damage awards.        

Rule 23(b)(2) after Dukes.

The district court's certification order in Duke's v. Wal-Mart was thus a bit of an anomaly because it allowed certification under the easier 23(b)(2) standard even though the plaintiffs were claiming literally billions in damages. 

In rejecting the lower court's certification analysis the Supreme Court effectively closed what some might characterize as the "loophole" of using 23(b)(2) to certify Title VII damage claims.  The Court did this in two ways.  First, the Court held that (b)(2) certification should be unavailable in almost all claims that include monetary relief.  Second, even to the extent subsection (b)(2) is available the Court took away its main attraction by requiring plaintiffs to meet a standard of "commonality" that is effectively the same as the "predominance" test required by (b)(3).

The effects of Dukes should be felt primarily in Title VII cases.  California wage and hour class actions are virtually never certified solely under Rule(b)(2), so the impact on these cases should be minimal.        

      

California Court Requires Evidence of Same-Sex Harasser's Sexual Orientation -- Kelley v. The Conoco Companies

It is well-settled that an employee may state a claim for sexual harassment even if the harasser is the same gender as the victim.  But it is still mandatory to prove that the harassing conduct was directed at the victim "because of" his or her gender. 

Courts have been fairly willing to infer that any sexually charged comments from a man to a woman are based on her sex.  But when one (presumably heterosexual) man uses sexually charged comments to harass or intimidate another man courts have been much less likely to find that the conduct was "based on sex."

In Kelley v. The Conoco Companies, for example, the Fifth District Court of Appeal recently dealt with a same-sex harassment claim arising out of an incident on a construction site.  The plaintiff's foreman started out criticizing his technique for tying re bar and then proceeded to unleashed a slew of gay-sex themed comments about how he was going to make the plaintiff his "bitch," etc.  I won't repeat all the graphic comments, but if your into that kind of thing you can see them here.     

Despite the sexual nature of the comments, the Court upheld the grant of summary judgment on the ground that the Plaintiff had presented no evidence that the comments were "based on sex."  As the Court explained:

 The statements made to Kelley were crude, offensive and demeaning, as it was evident that they were intended to be. No evidence, however, was presented from which a reasonable trier of fact could conclude that they were an expression of actual sexual desire or intent by [the harasser], or that they resulted from Kelley's actual or perceived sexual orientation. The mere fact that words may have sexual content or connotations, or discuss sex is not sufficient to establish sexual harassment. While the use of vulgar or sexually disparaging language may be relevant to show discrimination, it is not necessarily sufficient, by itself, to establish actionable conduct. 

The Court went on to hold that in a same-sex harassment case a plaintiff must present "evidence that an alleged harasser was acting from genuine sexual interest" in order to raise "an inference of discrimination because of sex."

The Court's ruling seems problematic in several regards.  First, I don't see why the Court is so certain that a reasonable jury could not question the sexuality of a male who told another man he wanted to have sex with him. 

Second, to avoid summary judgment the Court's rule would apparently require plaintiffs to do pre-trial discovery and present evidence on the "genuine sexual interests" of the harasser.  One can only imagine the problems this rule will cause in practice.  Will plaintiffs be required to do discovery on a harasser's past sexual partners?  Will alleged harassers be required to undergo court ordered mental exams to ferret out evidence of repressed homosexual tendencies?

The Kelley Court also acknowledges that it creates a split with the Second District's 2006 opinion in Singleton v. United States Gypsum Company, which held that no evidence of a same-sex harasser's homosexuality is required.  Thus, this is an issue that may well be headed to the California Supreme Court.

 

Department of Labor Releases Smartphone Application for Tracking Employee Work Hours

Employers are required by law to keep records of all hours worked by their non-exempt employees.  However, when the employer either fails to keep records or there is a dispute over the exempt status of an employee the lack of contemporaneous time entries can greatly complicated the dispute. 

In an effort to alleviate this problem, the federal Department of Labor has released a free, downloadable smart phone app that employees can use to track their time and create their own, independent time sheets.   Here is the text of the DOL announcement:

The U.S. Department of Labor today announced the launch of its first application for smartphones, a timesheet to help employees independently track the hours they work and determine the wages they are owed. Available in English and Spanish, users conveniently can track regular work hours, break time and any overtime hours for one or more employers. This new technology is significant because, instead of relying on their employers’ records, workers now can keep their own records. This information could prove invaluable during a Wage and Hour Division investigation when an employer has failed to maintain accurate employment records.
 

The free app is currently compatible with the iPhone and iPod Touch. The Labor Department will explore updates that could enable similar versions for other smartphone platforms, such as Android and BlackBerry, and other pay features not currently provided for, such as tips, commissions, bonuses, deductions, holiday pay, pay for weekends, shift differentials and pay for regular days of rest.
 

I have not had a chance to try it out yet, but this seems like a very useful tool for employees and employers alike, especially for employee working in the field where timeclocks or paper timesheets are not practical.