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U.S. Supreme Court Rules Against California Union Organizers

The U.S. Supreme Court said California was violating the Constitution with a decades-old regulation that gives union organizers access to agricultural company land for part of the year to talk to workers.

Voting 6-3 along ideological lines, the justices said the 1975 provision, which grew out of the efforts of Cesar Chavez to give farm workers collective bargaining rights, infringed the rights of landowners.

The California regulation grants labor organizations a “right to take access” to an agricultural employer’s property in order to solicit support for unionization. Cal. Code Regs., tit. 8, §20900(e)(1)(C). The regulation mandates that agricultural employers allow union organizers onto their property for up to three hours per day, 120 days per year.

Organizers from the United Farm Workers sought to take access to property owned by two California growers “Cedar Point Nursery and Fowler Packing Company.

The growers filed suit in Federal District Court seeking to enjoin enforcement of the access regulation on the grounds that it appropriated without compensation an easement for union organizers to enter their property and therefore constituted an unconstitutional per se physical taking under the Fifth and Fourteenth Amendments.

The District Court denied the growers’ motion for a preliminary injunction and dismissed the complaint, holding that the access regulation did not constitute a per se physical taking because it did not allow the public to access the growers’ property in a permanent and continuous manner.

A divided panel of the Court of Appeals for the Ninth Circuit affirmed, and rehearing en banc was denied over dissent.

The U.S. Supreme Court reversed and ruled in favor of the landowners in the case of Cedar Point Nursery v Hassid.

The Takings Clause of the Fifth Amendment, applicable to the States through the Fourteenth Amendment, provides: “[N]or shall private property be taken for public use, without just compensation.

When the government physically acquires private property for a public use, the Takings Clause obligates the government to provide the owner with just compensation.

California’s access regulation appropriates a right to invade the growers’ property and therefore constitutes a per se physical taking. Rather than restraining the growers’ use of their own property, the regulation appropriates for the enjoyment of third parties (here union organizers) the owners’ right to exclude. The right to exclude is “a fundamental element of the property right.”

Riverside County DA to Lead EDD Fraud Task Force

The Riverside County Board of Supervisors signed off Tuesday on Riverside County District Attorney Mike Hestrin’s contract with the State of California to take the lead in handling investigations and prosecutions involving unemployment fraud.

According to the report in the Murietta Patch, in a 5-0 vote without comment, the board authorized the agreement with the California Office of Emergency Services, the terms of which are retroactive to Aug. 1, 2020, and will conclude on Dec. 31 of this year. A total $1.25 million is being awarded by Cal-OES.

DA’s staff is now tasked with overseeing the Pandemic Unemployment Assistance & Unemployment Insurance Fraud Task Force.

The funds allocated under the compact can be used for overtime expenses, hiring investigators, paying on-the-job expenses of city attorneys and area law enforcement officers while they build cases to present to the DA’s office, and equipment purchases required for investigations and prosecutions to move forward, according to agency.

The DA’s office is handling a growing number of fraud cases directly tied to jobless claims filed during the coronavirus public health closures. Some investigations are managed by the DA’s Bureau of Investigations; others are being spearheaded by municipal police agencies. Find out what’s happening in Murrieta with free, real-time updates from Patch.

The Riverside Police Department’s Economic Crimes Unit has been particularly busy. Earlier this month, the unit completed an investigation that uncovered the alleged theft of $316,500 in unemployment benefits from the California Employment Development Department. The 28-year-old defendant allegedly stole the identities of 13 people to withdraw the funds using state- issued ATM cards.

A report released on Jan. 28 by California State Auditor Elaine Howle estimated the EDD in 2020 disbursed at least $10.4 billion in benefits based on fraudulent claims, all of which were tied to the federal Pandemic Unemployment Assistance provided under the Coronavirus Aid, Relief & Economic Security Act.

The audit uncovered instances in which the Labor Department’s Office of Inspector General flagged nearly 3 million unemployment claims as likely connected to fraud, but the EDD failed to respond proactively.

Inmates incarcerated in multiple counties, including Riverside, are under investigation. The audit indicated more than $800 million in benefits were distributed to prisoners.

Convictions Show EDD Fraud a Decade Before Pandemic Began

Robert Joseph Maher, 42, formerly of Stockton, was sentenced by U.S. District Judge John A. Mendez to six years and three months in prison for mail fraud and aggravated identity theft.

According to court documents, between November 2010 and February 2018, Maher participated in a scheme to defraud the State of California Employment Development Department (EDD) by filing fraudulent claims for unemployment insurance benefits.

In furtherance of this scheme, Maher and his co-defendant, Michael Herron II, also of Stockton, created fictitious companies and fictitious employees by using the real identities of persons with and without their knowledge. They then filed claims with EDD, falsely stating that the employees had been laid-off or fired. The unemployment benefits were deposited onto debit cards that were mailed to addresses controlled by Maher, Herron, or their associates.

In one instance, Maher and Herron electronically filed an unemployment insurance claim in the name of an identity-theft victim. Maher knew that the victim was a real person because the claim listed the victim’s correct date of birth and social security number. The claim also listed Maher’s address in Stockton as the claimant’s address, which caused a bank to mail an EDD debit card in the victim’s name to Maher’s address.

Maher and Herron then transferred the card’s benefits to Maher’s personal bank account. Maher and Herron also used the victim’s name to register another fictitious business entity that was used in the fraud scheme.

In all, Maher and Herron filed at least 72 fraudulent claims for unemployment insurance benefits, seeking a total of $739,535, of which EDD paid out approximately $609,335. Judge Mendez ordered Maher to pay restitution to EDD in the amount of $609,335.

This case is the product of an investigation by the U.S. Department of Labor – Office of Inspector General, the Federal Bureau of Investigation, and the California Employment Development Department’s Investigation Division. Special Assistant U.S. Attorney Robert J. Artuz is prosecuting the case.

On March 26, 2019, Herron pleaded guilty to similar counts of mail fraud and aggravated identity theft and, on June 25, 2019, was sentenced to six years and three months in prison.

Poorly Organized Ortho Surgical Trays Drive up Costs

A new study tracked instrumentation utilization rates for total knee arthroplasties at two high volume East Coast hospitals: Rothman Orthopaedic Institute in Philadelphia and Main Line Orthopaedics in Bryn Mawr, Pennsylvania. The study, titled “Minimizing Surgical Instrument Burden Increases Operating Room Efficiency and Reduces Perioperative Costs in Total Joint Arthroplasty,” has just been published in the June 1, 2021, edition of The Journal of Arthroplasty.

RyOrtho.com reports that Jess Lonner, M.D., one of the study’s authors and an orthopedic knee surgeon at Rothman, explained the genesis of the study. “Our imperative, as responsible stewards of value-based care, is to deliver the best care possible while controlling costs. As an orthopaedic community we have tackled the obvious big-ticket items – implant costs, length of stay, reducing the use of inpatient rehab and skilled nursing facilities. But there are other opportunities to control costs during the perioperative episode, which are less obvious, but equally important, particularly when taken together. It was my impression that we could improve OR workflow, reduce inefficiencies in instrument processing and ultimately help to control OR costs by ‘optimizing’ surgical trays.”

In any given hospital, the surgical instrument trays used in knee and hip arthroplasty surgery are often poorly organized and overstocked with redundant or underutilized tools. This increases the risk of processing and sterilization errors, increases processing time and expenses, increases the risk of error in tray preparation, increases the time it takes for the OR technician to set up the table, and it puts those who have to lift the heavy trays at risk of work-related injuries from muscular strain. This issue has been looked at in other surgical specialties and a little bit in the subspecialty of knee and hip arthroplasty, but we wanted to study the use of Lean methodology at one hospital to determine the potential cost savings by paring down instrument trays.”

The team randomly selected 35 elective primary total hip and knee arthroplasties performed by four fellowship-trained surgeons. An independent observer noted the type and number of instruments used as well as the timing of different steps in the sterilization process. Using the principles of Lean methodology, the “….surgeons identified redundant or underutilized instruments and agreed upon the fewest number needed for each tray. Instrument utilization rates and processing time were analyzed before and after tray modifications. Annual cost savings were calculated based on a processing factor of $0.59-$11.52 per instrument.”

“What we found was stunning,” said Dr. Lonner, “but not necessarily surprising. When we observed the percentages of instruments in a surgical set that were being used by several different surgeons, it turns out that between 40% and 50% of instruments were unused or underutilized. In our analysis, removing unused instruments and suggesting that surgeons use ‘comparable’ yet redundant tools in some situations, resulted in considerable savings in instrument tray sterilization and processing times and OR table set up times ….leading to substantial direct and indirect cost savings.

In one particular hospital, through the application of Lean methodology, total instrument count could be reduced by roughly 1/3 and the number of instrument sets could be reduced by up to 2/3 in some cases, leading to 40-150 minutes saved during the sterilization process and potential cost savings of nearly $300,000 per year on average for a 1,500 joint replacement case volume.”

“This paper could have substantial implications for hospitals with ORs and perioperative processes which are inefficient (probably the majority of hospitals) and which are looking for ways to control costs, improve workflow, eliminate inefficiencies in the arthroplasty space (definitely the majority of hospitals).”

Employers Face “Hairball” of Post Pandemic Safety Rules

Employment lawyers say companies are watching closely how pandemic return-to-work rules play out nationally, as they look to bring workers back safely and to dispense with mask protocols. “It’s a hairball,” said Eric Hobbs, an employment attorney with Ogletree Deakins in Milwaukee. “It’s all very confusing.”

The report published by Reuters claims that in some states, return to work rules may require identifying those who got a COVID-19 shot with badges or bracelets, raising discrimination issues and complicating hiring in a tightening labor market as the pandemic eases.

The U.S. workplace safety regulator, the Occupational Safety and Health Administration, or OSHA, has not provided clear guidance on the issue. “We continue to let the employer make the determination how to properly do this for their workplace,” OSHA’s acting director, Jim Frederick, told Reuters.

The U.S. Centers for Disease Control and Prevention, which said last month that inoculated people can go without face coverings indoors in most places, has not addressed the thorny issue of how to establish whether someone has been vaccinated.

“What companies are debating right now, and we are too, is: is it necessary to specify on someone’s badge or wear something around their neck that, yes, they are vaccinated and therefore if they don’t have a mask on there’s nothing to worry about?” said Peter Hunt, vice president of brand protection and security at Flex Ltd, a product design and manufacturing company.

However, employers in California’s Santa Clara County, including Christopher Ranch, are required as of June 1 to ascertain if their workers have been vaccinated and check in every 14 days on those who say they have not or who decline to answer.

America’s largest garlic farm needs 1,000 workers to harvest its annual crop, but faces an unexpected hurdle in this year’s recruitment drive: it now must document and track the COVID-19 vaccine status of these seasonal laborers. The timing of the order, in the middle of the busy harvest season, couldn’t be worse.

Ken Christopher, the farm’s executive vice president, said the company has to develop a system to check who has been vaccinated while observing privacy laws and monitoring workers’ adherence to safety protocols and testing. “If the government wants to mandate (a vaccine), that’s one thing,” Christopher said. “But then requiring us to police it, that feels very unconventional.”

Workers in the Silicon Valley county who aren’t vaccinated or refuse to reveal their status to their employer must remain masked and should follow other protocols, such as limiting long-distance work travel and submitting to regular COVID-19 testing.

Christopher said he is considering a mask-free shift for vaccinated workers and another shift for workers who haven’t gotten their shot to avoid discrimination and tension. But asking farm laborers about their vaccination status and entering their details in a database could hurt recruitment efforts, he said.

“It’s the additional information being offered to the government,” said Christopher. “The more layers added on top, the more uncomfortable they are in seeking jobs here.”

Several states, including California, Michigan and Oregon, have their own rules or guidance on documenting vaccination status for workers but they are generally less strict than in Santa Clara County.

In Montana, however, a recently enacted law discourages employers from asking about vaccination status because it could lead to discrimination claims, according to employment lawyers.

California Approves 100M Bailout for Failing Cannabis Industry

Getting cannabis regulations wrong comes at a high cost, as California’s $100 million fund to help floundering marijuana businesses has made clear.

Bloomberg reports that California earmarked money last week to aid companies that are struggling financially in large part because of bureaucratic delays and missteps in transitioning them from temporary licenses into more stringent permanent ones. It’s a cautionary tale for other states that are figuring out how to balance social-equity provisions, tax rates and competing with an illicit market valued at $66 billion last year, according to New Frontier Data.

While California’s 15% tax on legal marijuana has been blamed for pushing consumers to the illicit market, it’s clear that much more has gone wrong. Legalization, which began in 2016, has been messy with rules varying by city and county. The process has also been slow and expensive. That weighed most on small operators, thus many haven’t transitioned to the regulated recreational market, which has more potential than medical.

Steve Allan, chief executive officer of the Parent Company, which has acquired several cannabis firms in California, estimated that only about 700 of the state’s roughly 10,000 dispensaries have become fully legal and regulated. That’s left a swathe of companies in a gray area. Others have tried to make the transition, but are still struggling with the process, he said.

“This money tries to make up for what has been a slow, heavy red-tape process of getting these dispensaries up and going,” Allan said in a phone interview last week.

The biggest issues are that in California it can take as long as two years to get a license and initial costs to open a regulated dispensary start at about $250,000, according to Allan. That’s too big of a hurdle for many smaller operators. Cities and counties also didn’t roll out programs quickly enough to encourage legacy sellers to get licensed because they worried the public wouldn’t like the government helping the once illegal industry, Allan said.

Lawsuits also gummed up the transition. After California gave out its first 100 licenses, it planned to allocate others to “social equity applicants” — minorities and others harmed by the war on drugs. That effort got mired in the courts over who qualified.

Allan doubts the $100 million will bring much relief, calling it a “drop in the bucket” that won’t be enough to save all the struggling dispensaries. Still, his firm plans to keep consolidating what remains of a crowded market that’s still promising.

The state also sees opportunity ahead. Governor Gavin Newsom’s $100 billion “California Comeback” plan calls for $630 million in future tax funds from legalized cannabis to be spent on health care, environmental protection, and public safety.

Injury While on Personal Errand in “Mobile Office” is AOE-COE

In 2018, John Chrobagian was involved in a serious automobile accident in his company-provided vehicle. He was in field performing work for Ormco Corporation in servicing orthodontist accounts.

At some point in the day he engaged in a personal errand by stopping at a car dealership. From there he headed to his child’s school for pick up. While driving between these two locations Chrobagian was involved the serious vehicle accident and was injured.

He was a senior territory manager. The job duties required that he perform sales to existing accounts with orthodontists and develop new accounts as well within his territory covering primarily California and Nevada. He was not provided a fixed office location. Instead the employer provided a vehicle, cell phone and an email account.

He was expected to respond to any texts or emails through the cell phone/email account throughout the day. If he received a text or email while driving, he was expected to pull-over the vehicle and stop before responding to the text or email, or if applicant had a blue tooth connection, applicant could continue to drive and respond to the text/email, as long was such communication while driving complied with State law.

There was no prohibition on engaging in personal errands at the same time he was in the field performing his duties for the employer and that both can occur simultaneously.

The employer denied benefits claiming it did not occur in the course of employment. After a trial, the WCJ awarded benefits and found that the company vehicle as outfitted was for all intents and purposes a mobile office provided by the employer. He was at the beck and call of the orthodontists throughout the day and was expected to be at the ready to field any/all phone calls, texts and emails, wherever the applicant might be in an immediate manner.

The award was sustained in the panel decision of Chrobagian v Ormco Corporation, ( ADJ12278544 June 2021).

The going and coming rule is not applicable here because applicant was a salaried, mobile, regional sales person who essentially worked out of an employer provided vehicle. At the time of the injury, he was not engaged in a routine commute, to a fixed place of business, at fixed hours. Instead, he worked out of his vehicle making cell phone calls, sending and receiving emails, and driving throughout a large region that included California and Nevada to meet with clients.

Moreover, even if the going and coming were applied to applicant’s travel, the facts of this case bring it within several of the rule’s many exceptions. One of those exceptions consists of instances involving employer provided transportation.

In addition, the personal comfort doctrine holds that the course of employment is not broken by certain acts relating to the personal comfort of the employee, as such acts are helpful to the employer in that they aid in efficient performance by the employee. On the other hand, acts which are found to be departures effecting a temporary abandonment of employment are not protected.

Moreover, injuries sustained while the employee is engaged in an activity that has a dual purpose, which serves the business needs of the employer and the personal needs of the employee, occur in the course of employment.

Thus the WCAB panel agreed with the WCJ that the fact that applicant was injured while traveling between two personal errands did not remove him from the course of employment where he had already begun his work day as a mobile salesperson, working out of his employer provided vehicle, while available for any employment related communications, during compensated time.

Owner-Builder Requires Contractor License and WC Insurance

The Monterey County District Attorney announced that Marco Polo DeLaRosa Zesati, a 37-year-old Castroville resident and owner of “World Class Properties, LLC,” pled no contest to contracting without a license and failing to secure payment of workers’ compensation insurance. He was sentenced to 40 days in county jail, 3 years court probation, and a $1,000 fine.

The Contractor State Licensing Board (“CSLB”) opened an investigation of Zesati in March 2018.

CSLB investigators observed four persons painting and plastering a property owned by Zesati. They determined that he was acting in the capacity of a general B contractor, by undertaking a project of owner builder without the required contractor license, a violation of Business and Professions Code section 7028(a).

Zesati also utilized labor of at least four persons without providing workers’ compensation insurance, a violation of Labor Code section 3700.5.

The CSLB allows an owner to act without a general contractor in charge of a project under the following terms:

For Home Improvements:

– – The work site must be your principal residence that you have occupied for 12 months prior to completion of the work;
– – The work must be performed prior to the sale of the home; and
– – You cannot take advantage of the contractor license exemption on more than two structures during any three-year period.

For construction of new single-family residences:

– – You are limited to selling four or fewer residential structures in one calendar year; and
– – The work necessary to complete the project(s) must be performed by licensed subcontractors.

The case was referred to the District Attorney’s Workers’ Compensation Fraud Unit..

Under California criminal law, business owners need to be aware that California law requires all employers to secure workers’ compensation insurance for their employees. Workers’ compensation insurance ensures employees injured on the job have adequate medical coverage and other benefits. Persons have information about suspected workers’ compensation fraud are encouraged to contact the District Attorney’s office at 831-755-3224.

Relaxed Cal/OSHA COVID Standards Effective Today

The Occupational Safety and Health Standards Board adopted revisions to the COVID-19 Prevention Emergency Temporary Standards that account for recent guidance from the California Department of Public Health based on increases in the number of people vaccinated.

Governor Gavin Newsom signed an executive order enabling the revisions to take effect without the normal 10-day review period by the Office of Administrative Law – providing clarity and consistency for employers and employees as California fully reopens its economy. The revised standards took effect today.

The revisions include the following:

– – Fully vaccinated employees do not need to be offered testing or excluded from work after close contact unless they have COVID-19 symptoms.
– – Fully vaccinated employees do not need to wear face coverings except for certain situations during outbreaks and in settings where CDPH requires all persons to wear them. Employers must document the vaccination status of fully vaccinated employees if they do not wear face coverings indoors.
– – Employees are not required to wear face coverings when outdoors regardless of vaccination status except for certain employees during outbreaks.
– – Employees are explicitly allowed to wear a face covering without fear of retaliation from employers.
– – Physical distancing requirements have been eliminated except where an employer determines there is a hazard and for certain employees during major outbreaks.
– – Employees who are not fully vaccinated may request respirators for voluntary use from their employers at no cost and without fear of retaliation from their employers.
– – Employees who are not fully vaccinated and exhibit COVID-19 symptoms must be offered testing by their employer.
– – Employer-provided housing and transportation are exempt from the regulations where all employees are fully vaccinated.
– – Employers must review the Interim guidance for Ventilation, Filtration, and Air Quality in Indoor Environments.
– – Employers must evaluate ventilation systems to maximize outdoor air and increase filtration efficiency, and evaluate the use of additional air cleaning systems.

Cal/OSHA is updating its resources to assist employers with understanding their obligations required by the revised emergency standards. The webpage contains an updated fact sheet and Frequently Asked Questions about proposed revisions to the emergency temporary standards. In addition, Cal/OSHA is currently updating its model COVID-19 Prevention Program in English and Spanish and information on planned webinars hosted by its Consultation Services Branch.

Employers with Questions on Requirements May Contact: InfoCons@dir.ca.gov, or call your local Cal/OSHA Consultation OfficeStakeholders Who Wish to Comment on the Rulemaking Process May Contact: oshsb@dir.ca.gov

NSC, Amazon Team Up to Address Workplace Injuries

Amazon and the National Safety Council have created a five-year, $12 million partnership to find innovative solutions to prevent the most common workplace injury: musculoskeletal disorders (MSDs).

MSDs are an under-recognized yet omnipresent safety challenge that affect nearly one-quarter of the world’s population. In the U.S., businesses experienced more than 265,000 MSD injuries involving days away from work in 2019.

MSDs are complex and result from a combination of forceful exertion, repetitive movement and awkward or static posture. The subset of MSDs often referred to as repetitive motion injuries are chronic and result from exposures to risk factors over the course of weeks, months or years. The goal of the partnership is to take a proactive approach to prevent these injuries before they ever occur.

Built on the principles of data and innovation, the partnership will aim to prevent MSDs by engaging key stakeholders, conducting research, inventing new technology and processes, and scaling the results. Amazon’s $12 million contribution is the largest corporate contribution in the Council’s history. The partnership will include five key components:

Advisory Council: Establish an international advisory council of experts, corporations, researchers, practitioners and innovators in the public and private sectors. The advisory council will work together to review the most promising approaches to MSD prevention, shape development of the partnership components and engage external parties on MSD prevention.

Innovative Research: Conduct research utilizing next-generation artificial intelligence, natural language processing and machine learning tools to explore current and future MSD innovation and trends. This research will live in an open-source platform for all industries to explore and glean insights.

Small Business and University Grants: Provide grants for small- to medium-sized businesses, universities and university students. These grants will fund research and innovation that help companies of all sizes achieve impact.

Innovation Challenges: Incubate and foster innovative and practical solutions to address MSDs through Innovation Challenge competitions. These competitions will bring together experts to collaborate, iterate and share techniques and ideas.

Industry Call to Action – The MSD Pledge: Amazon and NSC will share solutions discovered throughout the partnership to inspire change through the creation of The MSD Pledge and a call on other companies to also join the effort to:

– – Track proactive indicators of injuries to ensure proper risk mitigation, and implement prevention strategies based on data.
– – Implement an MSD prevention program that includes educating employees about injury prevention.
– – Embrace and drive forward innovative solutions to reduce MSDs and share best practices with other organizations worldwide.

For further updates on this initiative, you may sign up on the National Safety Council website.