Modern Timekeeping Warning: California Court Rules That Employee’s Imprecise Evidence Is Better Than Employer’s Lack Of Records

A recent decision by the California Court of Appeal has created new precedence for an employers’ obligation to track employee time records accurately.

On December 12, 2018, in the case of Furry v. East Bay Publishing, LLC, the court ruled that the employee’s “imprecise evidence,” for their hours worked was adequate to “shift the onus to the employer to either provide a specific detail on the amount of overtime or to disprove by evidence what was not correct with the employee’s figures.”

Despite an early decision by a trial court in favor of the employer, the Court of Appeal ruled that the employer could not disprove the employee’s recollection of their hours worked could entitle them to unpaid overtime wages.

The initial trial court decision had four primary components:

  1. The misclassification of the employee’s “marketing director,” position as a salaried exempt position;
  2. Paying penalties for meal periods that the employee claims they worked,
  3. Incomplete and inaccurate paystubs; and
  4. Paying the employee overtime wages for additional hours they claimed they worked.

The good news for employers is that both courts ruled in favor of East Bay Publishing regarding the meal periods because Furry could not prove that the employer “knew or reasonably should have known,” that he was routinely working through his meal periods.

The main area where the courts diverged was regarding the issue of whether the employer owed the misclassified employee overtime. The Court of Appeal stated that the trial court was incorrect in their decision to reject Furry’s overtime claim because his ‘imprecise evidence’ was still substantial enough to award him for damages since his employer failed to track reliable time records and did not supply accurate wage statements.

While the Court of Appeal’s decision on this case isn’t definitive for all cases like this one, it does point toward a trend of courts leaning in favor of the employee when they use a general recollection of their hours worked against an employer’s complete lack of records. This decision is a good reminder to employers that accurate record keeping, and proper exemption status classifications are now more critical than ever.

NEW CASE: The Michigan Court of Appeals Reinforces Zero-Tolerance Workplace Rules

In a recent case ( Eplee v City of Lansing ), the Michigan Court of Appeals held that an employer could rescind a conditional offer of employment when the applicant fails a drug screen for Marijuana.

In this case, the plaintiff, Angela Eplee, was given a conditional offer of employment by the defendant, Lansing Board of Water and Light (BWL).

At the time of the offer, Eplee informed the employer that she qualified under the Michigan Medical Marihuana Act (MMMA) for a valid medical marijuana registry card.  Eplee underwent a preemployment drug test and tested positive for marijuana and BWL rescinded the conditional offer of employment.

Eplee alleged that BWL violated section 4a of the Michigan Medical Marihuana Act (“MMMA”) which prohibits the denial of “any right or privilege” because of a qualifying use of medical marijuana and that there was no “legitimate business reason” to rescind her offer of employment.

The Michigan Court of Appeals noted that under Michigan law there is a presumption of employment at-will. The court decision reinforced that the MMMA does not create “carte blanche” protections to registered medical marijuana patients and that the MMMA did not create a “contractual right to employment where no such right previously existed.”

At this time, Michigan employers may continue to enforce zero-tolerance drug testing policies and rescind conditional offers of at-will employment after careful consideration. It is recommended to keep abreast of this quickly changing area of employment law and consult with an Employment Professional before taking any adverse action.

NEW LAW: Daly City, CA Minimum Wage To Increase To $15 By 2021

On January 14, 2019,  the Daly City City Council enacted the Daly City Minimum Wage Ordinance, which incrementally increases the minimum wage in Daly City from $12.00 to $15.00 in accordance with the following schedule:

  • January 1, 2020 — increases to $13.75 per hour
  • January 1, 2021 —increases to $15.00 per hour
  • January 1, 2022 – increase will be based on the Consumer Price Index (CPI).

The minimum wage increase is accompanied by a new posting requirement.  Effective February 13, 2019, all employers in Daly City are required to post the Daly City Minimum Wage Ordinance posting in a conspicuous area where all employees can view it.

It is recommended that all Daly City employers prepare for these increases.

NEW CASE: While Sexual Orientation Is NOT Protected, Missouri Supreme Court Holds Sex Stereotyping Violates Missouri Human Rights Act

In a recent case (Lampley v. Missouri Commission on Human Rights), the Missouri Supreme Court has held that discrimination based on sexual stereotyping violates the Missouri Human Rights Act.

The Case

In this case, the plaintiff (a gay man) claimed that his employer had discriminated against him because he “does not exhibit the stereotypical attributes of how a male should appear and behave.” Specifically, he claimed that he was harassed at work because of his “non-stereotypical” behaviors, while male and female employees who were not gay and exhibited stereotypical male or female attributes, were treated differently.

The Ruling

While the Missouri Supreme Court was quick to point out that sexual orientation is not protected under the Missouri Human Rights Act, sexual stereotyping may give rise to an inference of unlawful sex discrimination if the employer took sexual stereotypes into account when making an employment decision.

In reaching this decision, the Missouri Supreme Court relied on the US Supreme Court’s holding in Price Waterhouse v. Hopkins, where the US Supreme Court recognized when an employer relies upon sex stereotypes in its employment decisions, that evidence may support an inference of sex discrimination.

In Price Waterhouse, a female senior manager was denied partnership after partners referred to her as “macho” and needing “a course at charm school.” She was also advised that to become a partner she needed to “walk more femininely, talk more femininely, dress more femininely, wear make-up, have her hair styled, and wear jewelry.”

The Missouri Supreme Court noted that since Price Waterhouse, it is clear an employer who discriminates against women because they do not wear makeup,  is  engaging  in  sex  discrimination because the discrimination would not occur but for the victim’s sex; it is clear that Price Waterhouse applies with equal force to a man who is discriminated against for acting too feminine.”

Take Home For Employers

In light of this ruling, Missouri employers need to remember that discrimination based on sex stereotyping is unlawful in Missouri and should take steps to ensure that their managers and supervisors receive training about the prohibition.

NEW LAW: Pasadena, CA Minimum Wage To Increase To $15 By 2020

On February 11, 2019,  the Pasadena City Council passed the Pasadena Minimum Wage Ordinance, which incrementally increases the minimum wage in Pasadena to $15.00 in accordance with the following schedule:

Small Employers

(25 or fewer employees)

Large Employers

(26+ employees)

July 1, 2019 $13.25 $14.25
July 1, 2020 $14.25 $15.00
July 1, 2021 $15.00 Increases will correspond to any Consumer Price Index (CPI) increase
July 1, 2022 Increases will correspond to any Consumer Price Index (CPI) increase

It is recommended that all Pasadena employers prepare for these increases.

 

NEW LAW: Fremont, CA Minimum Wage To Increase To $15 By 2020

On January 15, 2019,  the Fremont City Council enacted the Fremont Minimum Wage Ordinance, which incrementally increases the minimum wage in Fremont to $15.00 in accordance with the following schedule:

Small Employers
(25 or fewer employees)
Large Employers
(26+ employees)
July 1, 2019 $11.00 $13.50
July 1, 2020 $13.50 $15.00*
July 1, 2021 $15.00
July 1, 2022 Increase to equal large employer minimum wage

*Increases will correspond to any Consumer Price Index (CPI) increase, up to five percent starting July 1, 2021.

It is recommended that all Fremont employers prepare for these increases.

 

The DOL Strikes Back With Proposed Overtime Rule Version 2.0

The US Department of Labor (DOL) recently released its proposed new overtime regulations, wherein the DOL proposed the following changes to the white collar exemption:

  • The minimum salary threshold for the FLSA “white collar” overtime exemption would increase from $23,660 per year to $35,308 per year (or $679 per week);
  • Employers will be permitted to use an employee’s nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10% of the new standard salary level;
  • The total annual compensation requirement for highly compensated employees would increase from $100,000 per year to $147,414 per year; and
  • The salary threshold will be updated once every three years.

There are no proposed changes to the duties test for the white-collar exemptions (i.e. administrative, executive, or professional exemptions.

What’s Next?

It is important to remember – this is not the final rule.  It is only a proposal and must go through a lengthy review process.

The proposed rule will be open to public comment (60-day comment period) after which time the DOL may or may not revise the rules. The final step will be the publication of the final rules.  It is difficult to predict when the final rules, if adopted, will take effect.

In the meantime, it is strongly recommended that employers start thinking about how this change could impact their current exempt workforce.

NEW LAW: Important Changes To New Jersey SAFE Act

On February 19, 2019, New Jersey Governor Phil Murphy signed A3975 into law.

In addition to modifying the New Jersey Family Leave Act and the New Jersey Paid Family Leave Insurance Program (see “NEW LAW: Important Changes To New Jersey Family Leave Act And The New Jersey Paid Family Leave Insurance Program”), this bill also modifies and greatly expands the employee leave protections under the New Jersey SAFE Act.

What Is The NJ SAFE Act?

Under the NJ SAFE Act, New Jersey employers with 25+ employees are required to grant eligible employees a 20-day leave of absence if the employee or the employee’s family member has been the victim of domestic violence or a sexually violent offense.

Under the amended version, there are several changes that took immediate effect:

  • Employees taking NJ SAFE Leave Act are eligible for NJFLI Benefits.
  • The definition of the following term has been expanded (the new language is indicated in italics):
    • “Family member” means the employee’s parent-in-law,   sibling,    grandparent,    grandchild, child,    parent, spouse,  domestic  partner,  or  civil  union  partner individual,  or  any other  individual  related  by  blood  to  the  employee,  and  any  other individual that  the  employee  shows  to  have  a close association with the employee which is the equivalent of a family relationship.
  • Employers may no longer require employees use their accrued paid time off for domestic violence leave.

It is recommended that employers prepare for these changes to the New Jersey SAFE Act and make any necessary policy revisions.

NEW CASE: Minneapolis Minimum Wage Ordinance Upheld By Minnesota Court of Appeals

In 2017, the City of Minneapolis enacted a minimum wage ordinance, which increased the minimum wage in the city above Minnesota state minimum wage.

Under that ordinance, minimum wage in Minneapolis is scheduled to increase as follows:

Small Business

(100 or fewer employees)

Large Business

(101 or more employees)

January 1, 2018 $9.65 per hour $10.00 per hour
July 1, 2018 $10.25 per hour $11.25 per hour
July 1, 2019 $11.00 per hour $12.25 per hour
July 1, 2020 $11.75 per hour $13.25 per hour
July 1, 2021 $12.50 per hour $14.25 per hour
July 1, 2022 $13.50 per hour $15.00 per hour*
July 1, 2023 $14.50 per hour
July 1, 2024 Increase to equal large business minimum wage

* minimum wage increases to account for inflation starting January 1, 2023

In November of 2017, several businesses in Minneapolis filed a lawsuit challenging the legality of the Minneapolis Minimum Wage Ordinance and sought to enjoin the Ordinance (or prevent it from going into effect).  The district court denied the injunction and the minimum wage ordinance went into effect on January 1, 2018, as scheduled.

The businesses appealed that ruling and, on March 4, 2019, the Minnesota Court of Appeals upheld the district court’s ruling.

What does this mean for Minneapolis employers?

Simply put, this ruling means that the Minneapolis Minimum Wage Ordinance is still in effect and all employers in Minneapolis must be paying their employees at least the local minimum wage.

NEW LAW: Important Changes To New Jersey Family Leave Act And The New Jersey Paid Family Leave Insurance Program

On February 19, 2019, New Jersey Governor Phil Murphy signed A3975 into law.

In addition to modifying the New Jersey Family Leave Act and the New Jersey Paid Family Leave Insurance Program (see “NEW LAW: Important Changes To New Jersey Family Leave Act And The New Jersey Paid Family Leave Insurance Program”), this bill modifies and greatly expands the employee leave protections under the  New Jersey Family Leave Act (FLA) and the New Jersey Paid Family Leave Insurance Program (FLI).

What are the changes that took immediate effect?

Among those changes are the following:

  • The definitions of the following terms have been expanded (the new language is indicated in italics):
    • “Child” means a biological, adopted, foster child, or resource family child, stepchild, legal ward, or child of a parent, who is
      • under 18 years of age; or
      • 18 years of age or older but incapable of self-care because of a mental  or  physical  impairment including  a  child  who  becomes the  child of  a  parent pursuant to  a  valid  written  agreement  between the parent and a gestational carrier
    • “Parent” means   a   person   who   is   the   biological   parent, adoptive  parent, foster  parent, resource  family  parent,  step-parent, parent-in-law or legal guardian, having a “parent-child relationship” with  a  child  as  defined  by  law,  or  having  sole  or  joint  legal  or physical  custody,  care,  guardianship,  or  visitation  with  a  child,  or who  became  the  parent  of  the  child  pursuant  to  a  valid  written agreement between the parent and a gestational carrier
    • “Family member”   means   a   child,   parent, parent-in-law, sibling, grandparent, grandchild, spouse, domestic partner, or one partner  in  a  civil  union  couple,  or  any  other  individual  related  by blood  to  the  employee,  and  any  other  individual that  the employee  shows  to  have  a close  association  with  the  employee which is the equivalent of a family relationship.
    • “Family leave”  means  leave  from  employment  so  that  the employee may provide care made necessary by reason of:
      • the birth  of  a  child  of  the  employee,  including  a  child  born pursuant  to  a  valid written  agreement  between  the  employee  and  a gestational carrier;
      • the placement of a child into foster care with the employee or in connection with adoption of such child by the employee; or
      • the serious  health  condition  of  a  family  member  of the employee.
    • Employees can take New Jersey Family Leave on an intermittent basis for child-bonding purposes without first obtaining the employer’s consent.
    • Employees are now required to provide 15 days of advance notice (reduced from 30 days) of their need for New Jersey Family Leave – with one exception.
      • Employees must continue to provide 30 days advance notice for continuous bonding leave.
  • Employees are now entitled to a reduced leave schedule for up to 12 consecutive months for any one period of leave, as opposed to 24 consecutive weeks.
  • Employers may no longer require employees to use two weeks of paid time off in lieu of two weeks of NJFLI. Employees may elect to use their available PTO in addition to their NJFLI benefits.

What are the changes that take effect on June 30, 2019?

Effective June 30, 2019, the employers with 30+ employees will be considered “covered employers” for purposes of the New Jersey Family Leave Act and will be required to provide eligible employees with up to 12 weeks of job-protected family leave.

An “eligible employee” must meet all of the following requirements:

  • The employee has worked for the Company for at least 12 months;
  • The employee has worked at least a total of 1,000 hours in the 12 months preceding the date of the requested leave; and
  • The requested leave is for one or more of the following reasons:
    • To care for a spouse, child, or parent who has a serious health condition.
    • Birth of a child to the employee or to the employee’s spouse (expires 12 months after birth).
    • Placement of a child with the employee for adoption or foster care (expires 12 months after placement).

Employees may not use NJFLA to address their own serious health condition, except childbirth.

What are the changes that take effect on July 1, 2020?

There are several changes that will take effect on July 1, 2020 (primarily relating to NJFLI Benefits).  Among those changes are the following:

  • For any period of leave starting on or after July 1, 2020, employees can receive up to 12 weeks (or 56 days for intermittent leave) of benefits for family temporary disability leave.
  • Employees receiving NJFLI Benefits will be entitled to 85% of their average weekly wage, up to a maximum of 70% of the Statewide average weekly wage.

It is recommended that affected New Jersey employers prepare for these changes.