Author: WorkCompAcademy

The Party Staff, Inc. was founded in 1989 and is headquartered in Oakland California. The company has supplied staff for more than 100,000 events from backyard barbecues to black-tie dinners, cocktail parties to corporate events. The company provides formal and banquet servers, buffet attendants, tray passers, bartenders, cooks/chef/prep, grillers/carver/captains, event managers, host/hostesses, event attendants, set-up and break-down, concessions, coat check, permanent placements.

According to multiple media reports the company has filed a groundbreaking lawsuit on January 8, 2025 against many of their competitors challenging their claim to have exempt employees who are part of the gig economy. The case is The Party Staff v. Qwick, California Superior Court, San Francisco County, No. CGC-25-621259.

According to The Party Staff allegations, “This case is brought under the California Unfair Competition Law, Cal. Bus. & Prof. Code § 17200, et seq. (“UCL”), based on Defendants’ widespread misclassification of employees as independent contractors in violation of numerous provisions of the California Labor Code, as well as under California Labor Code § 2753, which imposes liability upon persons who knowingly advise employers to classify individuals as independent contractors to avoid employee status.”

“In accordance with the California Labor Code, Plaintiff classifies its workers as employees and thus bears the typical costs of being an employer, such as paying minimum wage and overtime and complying with other Labor Code protections, maintaining workers’ compensation insurance, and paying significant payroll taxes.”

“However, in recent years, Plaintiff has been increasingly undercut significantly by competing companies that bill themselves as “gig economy platforms”, such as Defendants Qwick, Instawork, and Tend, which have lifted a page from the “Uber” playbook, and misclassified their workers as independent contractors rather than employees.”

“In reality, Qwick, Instawork, and Tend are hospitality staffing companies (just like Plaintiff), and they have violated California law by classifying their workers as independent contractors. In so doing, they have been able to offer lower prices than Plaintiff, thereby gaining a significant competitive advantage.”

The Party Staff goes on to allege that “companies such as Defendants Aramark and ISS Guckenheimer that hold contracts for dining and catering services with large institutions have then contracted with Qwick, Instawork, and Tend for staffing, allowing Aramark and ISS Guckenheimer to profit from and perpetuate this misclassification as joint employers of those workers.“

“Plaintiff, which has complied with the law by classifying its workers as employees, has had its business significantly undercut by Defendants’ actions and has lost numerous clients as a result, significantly impacting its revenue. Defendants’ conduct is both unlawful and unfair, in violation of California’s Unfair Competition law.”

The Party Staff is seeking injunctive and declaratory relief in the form of an order directing Defendants to comply with the California Labor Code, among other relief.

Boston-based lawyer Shannon Liss-Riordan, who represents The Party Staff, said the lawsuit is the first of its kind involving staffing firms. “When companies misclassify workers, they make it very difficult for law-abiding companies to compete, and they drive an economic race to the bottom,” Liss-Riordan told Reuters.

Bonnie Ducksworth and Pamela Pollock were customer service representatives at Tri-Modal Distribution Services. Tri-Modal promoted others but, for decades, never promoted them. Ducksworth and Pollock believed this was due to discrimination against African-Americans. They sued.

In 2018, Pamela Pollock also sued her supervisor Michael Kelso for sexual harassment and, on grounds of race, refusing to promote her. Pollock alleged Kelso asked her for sexual intercourse in 2016 and, after she rejected him, he promoted five less qualified people of other races to positions she sought.

The trial court ruled Pollock’s suit was time-barred. In 2020 the Court of Appeal affirmed. (Ducksworth v. Tri-Modal Distribution Services (2020) 47 Cal.App.5th 532.) The case implicated employer Tri-Modal, but it was not involved in this appeal.

In 2021, the Supreme Court reversed and rendered three holdings. First, the statute of limitations in this type of case begins to run when plaintiffs knew or should have known of the adverse promotion decision. (Pollock v. Tri-Modal Distribution Services, Inc. (2021) 11 Cal.5th 918, 941.) Second, the defense bears the burden on this issue. (Id. at p. 947.) Third, under the Fair Employment and Housing Act, an appellate court may not award costs or fees on appeal to a prevailing defendant without first determining that plaintiff’s action was frivolous, unreasonable, or groundless when brought, or that plaintiff continued to litigate after it clearly became so. (Id. at pp. 947–951.)

Following the Supreme Court’s directions, in 2021 the Court of Appeal remanded and ordered costs for Pollock. In the trial court, Pollock moved for $526,475.63 in attorney fees under subdivision (c)(6) of Government Code section 12965 in late 2021. In March 2022, the trial court awarded $493,577.10. Kelso filed his notice of appeal. In February 2023, Kelso and Pollock settled the bulk of their case. Pollock moved to dismiss her underlying case with prejudice, except for the attorney fee award that Kelso was appealing.

The Court of Appeal approved the trial court award of costs in the published case of Pollock v. Kelso -B320574 (January 2025).

Kelso argues that, first, Pollock was not a prevailing party, and second, the award was too high.

When the trial court set a trial date and it grew near, Kelso decided to settle. Kelso declines to lodge the “confidential” settlement agreement with this court in camera, which Pollock’s counsel maintains expressly identifies Pollock as the prevailing party. At oral argument, Pollock’s attorney brought the settlement document to counsel table, but Kelso’s appellate attorney claimed she had never seen it. She declined to view it. Kelso’s reluctance, and Pollock’s willingness, reveal that Pollock won something tangible. Pollock’s gain postdates the trial court’s fee award, but it has significance for this appeal: the case is over and, as a practical matter, the time is ripe to consider a fee award.

The Court then turned to issue number two: the size of the award and noted “Kelso maintains the amount of the trial court’s fee award – $493,577.10 – is unreasonable. The court abused its discretion, Kelso asserts, by failing to apportion the award among “the defendants involved in the appeal.” Kelso, however, fails to identify who these other defendants were, how their issues might have been different from Kelso’s, and in what degree. Kelso forfeited this argument by failing to elaborate his argument in meaningful detail in his opening brief. It is not fair for Kelso to ask this court to spell out the particulars of his vague argument. His approach, were we to indulge it, would not give Pollock reasonable notice of the thrust she must parry.”

The opinion reviewed the evidence submitted and arguments made to the trial court that computed the attorney fee in great detail. It reviewed case law that established the proposition that “trial judges are in the best position to evaluate attorney fee awards.”

Ultimately the Court of Appeal affirmed the trial court.

The Paperwork Reduction Act (H.R. 3797) (“PBRA”), passed by the 118th Congress on December 11, 2024, is legislation aimed at reducing the administrative burden on businesses and individuals.This legislation aims to significantly reduce the administrative burden faced by businesses and individuals.

Here’s a breakdown of the Paperwork Reduction Act key provisions:

– – Focus on Employer Reporting: A central focus of the act is to ease the reporting requirements for employers, particularly those related to health insurance coverage.
– – Simplified 1095-C Forms: The act modifies provisions under the Affordable Care Act. Employers will no longer be obligated to send physical copies of the 1095-C form, which provides employees with information about their health insurance coverage.
– – Alternative Reporting Methods: Employers will have the option to provide employees with clear and accessible instructions on how to request a copy of their 1095-C form. This shift from mandatory physical distribution to an “on-demand” system is intended to streamline the process.
– – Reduced Administrative Costs: By simplifying reporting requirements and eliminating the need for mandatory paper forms, the act aims to reduce administrative costs for businesses of all sizes. This could translate into cost savings that can be reinvested in other areas of their operations.
– – Improved Efficiency: The streamlined reporting process is expected to improve efficiency for both employers and employees. Employers will spend less time on administrative tasks related to health insurance reporting, allowing them to focus on other priorities. Employees will have greater flexibility in accessing their coverage information.

The Paperwork Reduction Act represents a significant step towards reducing the administrative burden on businesses. By simplifying employer reporting requirements related to health insurance coverage, the act aims to create a more efficient and less costly system for both employers and employees.

And employers may benefit from another new federal law.The Employer Reporting Improvement Act (H.R. 3801) (“ERIA”) was passed alongside the Paperwork Reduction Act in December 2024. It focuses on streamlining Affordable Care Act (ACA) reporting requirements for employers, specifically:

– – Codifying Existing IRS Regulations: The ERIA codifies certain IRS regulations designed to simplify ACA reporting for employers. This provides legal certainty and reduces the risk of future regulatory changes that could increase the burden on businesses.
– – Establishing a Statute of Limitations: A crucial provision of the ERIA establishes a six-year statute of limitations for penalty assessments related to ACA coverage failures. This provides much-needed clarity and limits the potential for indefinite liability for employers.
– – Flexibility in Reporting: The ERIA allows employers greater flexibility in fulfilling their reporting obligations. For example, it permits electronic delivery of 1095-B and 1095-C forms to employees who consent to receive them electronically.
– – Alternative Identifier for Social Security Numbers: The ERIA allows employers to use an individual’s date of birth as an identifier in certain situations where the Social Security Number is unavailable. This helps to ensure accurate reporting even in cases where obtaining a Social Security Number may be challenging.
– – Extended Response Time for IRS Notices: The ERIA allows employers more time to respond to Employer Shared Responsibility (ESR) letters from the IRS, giving them additional time to investigate and address any potential issues.

The ERIA complements the Paperwork Reduction Act by providing specific, targeted improvements to ACA reporting requirements. By codifying existing regulations, establishing a statute of limitations, and increasing flexibility for employers, the ERIA aims to significantly reduce the administrative burden associated with ACA compliance. The specific provisions and their impact may vary depending on individual circumstances and the specific requirements of the IRS.

On July 29, 2024, applicant’s attorney, John R. Ramirez, filed a petition for attorney’s fees pursuant to section 5710. He represented that he personally represented applicant at deposition, and requested a fee award of one hour of preparation time and 3.6 hours of actual deposition time. And he requested a fee issue at the hourly rate of $425.00 per hour, or $1,955.00 total.

The workers WCJ issued an orderer that defendant pay $1,840.00 as a reasonable fee after finding that he was entitled to a rate of $400.00 per hour.The order contained a self-destruct clause advising that a timely objection within 20 days would void the order. Attorney Ramirez filed an objection letter along with a declaration of readiness to proceed to a mandatory settlement conference on the issue of 5710 fees.Accordingly, the dispute in this case is over an additional $115.00 fee.

After a hearing on October 3, 2024. The WCJ ordered the matter taken off calendar over the objection of attorney Ramirez, and deferred the issue of the remaining L.C. 5710 attorney fees.

On October 15, 2024 attorney Ramirez and The Ramirez Firm, filed a Petition for Reconsideration objecting to the Order taking the case off calendar. Specifically, in the Petition, Mr. Ramirez alleges that he is entitled to the unpaid portion of attorney’s fees and seeks to proceed to a trial on the issue of attorney’s fees.

The WCAB denied his Petition for Reconsideration, and denied his Petition for Removal, and instead, it Granted Removal on Motion of the Appeals Board, and issued a Notice of Intent to Impose Sanctions against Attorney John R. Ramirez in the panel decision of Armando Amezcua v Milgard Windows Manufacturing – ADJ19104113, ADJ19104112, ADJ19104123, ADJ19104121 (December 2024).

The WCAB noted that “it appears that Mr. Ramirez improperly filed a Petition for Reconsideration in response to a non-final order. It appears that Mr. Ramirez did this in six different cases and he was admonished in five of those cases to review his filings and make necessary corrections.

Moreover on November 5, 2024, just a few months ago, the Appeals Board issued a significant panel decision in Latrice Reed v. County of San Bernardino. (2024 Cal. Wrk. Comp. LEXIS 69.) and admonished Mr. Ramirez who was the applicant attorney in that decision without imposing sanctions. Instead it said “for the purpose of this decision, we will assume that the filing of a petition for reconsideration rather than one for removal was merely a careless error. Accordingly, we do not take up the issue of sanctions at this time.”

However, on this newest case, the WCAB concluded “It does not appear that Mr. Ramirez responded to any of the admonishments given to him. It appears that Mr. Ramirez filed a frivolous petition for reconsideration in this matter and allowed it to proceed on the merits, taking no steps to either withdraw or amend the pleading. It does not appear that our admonishments have had the actual effect of correcting Mr. Ramirez’s conduct”.

“Accordingly, and good cause appearing, pursuant to section 5813 and WCAB Rule 10421 we will issue a notice of intention to impose sanctions against John Ramirez (SBN 201939) in an amount up to $750.00 as he filed a petition for reconsideration from a non-final order, which appears to constitute frivolous conduct, particularly since Mr. Ramirez was admonished on five occasions to correct his conduct, and it appears that he failed to act.”

Blue Cross and Blue Shield of Oklahoma (“BCBSOK”) have filed a civil Racketeering (RICO) action against South Coast Behavioral Health LLC (“SCBH”), Excellence Recovery LLC (“Excellence Recovery”), Everything in Excellence Recovery LLC (“EIE”), Rad Life Recovery, LLC, (“Rad Life”), and individuals involved with those companies, that are California addiction treatment centers mostly located in Orange County. The lawsuit was filed in the United States District Court Central District of California (case 2:24-cv-10683-MWC-AJR).

According to the allegations of the complaint, “Since at least 2020, BCBSOK and hundreds of individuals suffering from Substance Use Disorder (“SUD”) have been victimized by California-based SUD treatment providers and their co-conspirators.”

“California and Oklahoma are separated by over 1,000 miles and multiple states. There are hundreds, if not thousands, of SUD treatment providers between them. And yet, in the last few years alone, thousands of alleged Oklahoma residents have been trafficked across the country to California under the guise of obtaining SUD treatment. The one thing they have in common is that they are members of BCBSOK health benefit plans, most of them having been enrolled right before their arrival in California.”

“This surprising migration is not a result of quality treatment. Rather, it is driven by an army of fraudsters that have overrun certain parts of California’s SUD treatment industry to prey upon alleged Oklahoma residents, many of whom are members of Native American tribes.”

Oklahoma, according to many sources has the fifth highest rate of SUD in the country, at 16.1% of its population.”The combination of a state plan offering robust out-of-state benefits and a large population in need of treatment provided a perfect target for profiteers like Defendants.”

“These SUD providers employ a range of fraudulent tactics. They hire “body brokers” to hunt down potential patients in exchange for kickbacks. Body brokers work with insurance agents to fraudulently enroll individuals in insurance plans. Once enrolled, patients are shipped across the country to receive “treatment,” the main goal of which is to enrich the providers, body brokers, insurance agents, and the others involved in the schemes. There are unlawful kickbacks at every level. In fact, many patients themselves receive cash, free “treatment,” and housing, which unlawfully influences their choice of providers and induces them to stay under the control of a particular provider so that their insurance can continue to be billed. It is becoming exceedingly difficult for good, quality, providers to operate in an industry awash in kickbacks and de facto bribes.”

“When insurance payments run out, the SUD providers kick patients to the curb, leaving these vulnerable individuals to fend for themselves thousands of miles from their homes. Often, these individuals are given no notice of their impending evictions and suddenly find themselves on the streets with no money to afford housing or the necessities of daily life, much less an expensive trip back home. Putting these already-vulnerable individuals in such desperate circumstances only heightens the chances for relapse.”

Plaintiffs go on to allege “the defendants here are among the worst perpetrators of these tactics. Collectively, they have caused BCBSOK plans alone to make over $36 million in wrongful payments.” Last month, Blue Cross and Blue Shield of Oklahoma told the Southern California News Group that it will stop paying for all addiction treatment in California on Jan. 1, with a few exceptions.

Young and associates are being sued by insurer Aetna in a fraud case that echoes this one. Young has countersued Aetna, saying the insurer is just trying to avoid paying what’s owed.

It all echoes the battle between Health Net and now-defunct Sovereign Health that began in 2016. Health Net won big, with $45 million in damages and interest against Sovereign.