Tag: 2021 News

Last November, a putative class action was filed in Solano County Superior Court by Maria Johnson, on behalf of herself and other similarly situated current and former employees of Lowe’s Home Centers, LLC, and as a proxy for the State of California.

She began working for Lowe’s in 2015 and worked California, until her employment as a delivery coordinator ended in October of 2020.

This class and representative action challenges alleged systemic employment practices resulting in violations of the California Labor Code against individuals who worked for Defendants. The Complaint addresses Defendants’ violations of Labor Code sections 201-202, 204,226,233, and 246, and seeks penalties, damages, and other relief pursuant to, among other provisions, Labor Code sections 203,210,218,218.5, 218.6, 248.5, and 2698 et seq., and the Unfair Competition Law, codified in the Business and Professions Code.

Maria Johnson alleges four causes of action; (1) Unpaid Sick Pay (including derivative penalties for such unpaid sick pay, including waiting time penalties); (2) Inaccurate Itemized Wage Statements; (3) Unfair or Unlawful Business Practices; and (4) Violations of the California Labor Code §§ 2698, et seq.

With respect to the first cause of action, plaintiffs allege that “As a matter of policy and practice, Defendants pay Plaintiff and the Sick Pay Class for sick time at the incorrect rate of pay. Defendants pay Plaintiff and the Sick Pay Class at the base hourly rate of pay, as opposed to the regular rate of pay, which would take into account all non-discretionary remuneration in addition to their base hourly wages, including for example incentives or bonuses, or the rate resulting from dividing the employees’ total wages, not including overtime premium pay, by the employees’ total hours worked in the full pay periods of the prior 90 days of employment, as required by Section 246. This results in underpayments of sick pay wages to Plaintiff and the Sick Pay Class.“

They support this claim by saying “The California Supreme Court has explained that “[c]ourts have recognized that ‘wages’ also include those benefits to which an employee is entitled as a part of his or her compensation, including money, room, board, clothing, vacation pay, and sick pay.” Murphy v. Kenneth Cole Prods., Inc., 40 Cal. 4th 109 4, 1103 (2007) ( emphasis added).”

According to Lowe’s data, there were approximately 18,799 full-time, non-exempt individuals employed by Lowe’s in California who were paid sick pay wages at any time during the period of November 23, 2017 to December 21, 2020.

On January 15, 2021 Lowe’s provided Notice that it had filed documents to remove the case to the United States District Court for the Eastern District of California. In this regard they allege “Removal of a class action is proper if: (1) there are at least 100 members in the putative class; (2) there is minimal diversity between the parties, such that at least one class member is a citizen of a state different from any defendant; and (3) the aggregate amount in controversy exceeds $5 million, exclusive of interest and costs.”

Lowe’s maintains that this action was improperly filed in state court because “Plaintiff agreed to binding individual arbitration of the claims she has asserted in this action. Lowe’s also intends to oppose class certification on multiple grounds, including that (a) Plaintiff must arbitrate her claims against Lowe’s individually pursuant to the binding and enforceable arbitration agreement and class action waiver executed by Plaintiff, and (b) class treatment is inappropriate under these circumstances in part because there are many material differences between the named Plaintiff and the putative class members Plaintiff seeks to represent, as well as amongst the putative class members.”

Lowe’s avers, for the purposes of meeting the jurisdictional requirements for removal only, that if Plaintiff were to prevail on every claim and allegation in her Complaint on behalf of the putative class, the requested monetary recovery would exceed $5 million.

At the request of the United States Court of Appeals for the Ninth Circuit, the California Supreme Court agreed to decide the following question of California law: Does this court’s decision in Dynamex Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903 (Dynamex) apply retroactively?

In Dynamex, the Supreme Court was faced with a question of first impression: What standard applies under California law in determining whether workers should be classified as employees or independent contractors for purposes of the obligations imposed by California’s wage orders?

It held that such a worker can properly be found to be “an independent contractor to whom a wage order does not apply only if the hiring entity establishes: (A) that the worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work and in fact; (B) that the worker performs work that is outside the usual course of the hiring entity’s business; and (C) that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity.”

This is now referred to as the A-B-C test.

Defendant argued that an exception to the general retroactivity principle should be applied here because, prior to Dynamex, businesses could not reasonably have anticipated that the ABC test would govern at the time when they classified workers as independent contractors rather than employees.

In answer to the question posed by the Ninth Circuit, the Supreme Court concluded in Gerardo Vazquez v Jan-Pro Franchising International, Inc.,that it’s decision in Dynamex applies retroactively to all nonfinal cases that predate the effective date of the Dynamex decision.

Employers were clearly on notice well before the Dynamex decision that, for purposes of the obligations imposed by a wage order, a worker’s status as an employee or independent contractor might well depend on the suffer or permit to work prong of an applicable wage order – and that the law was not settled in this area.

The Division of Workers’ Compensation (DWC) has issued a notice of conference call public hearing for a proposed evidence-based update to the Medical Treatment Utilization Schedule (MTUS), which can be found at California Code of Regulations, title 8, section 9792.24.7.

The conference call public hearing is scheduled for Thursday, February 18, at 10 a.m. and members of the public may attend by calling 866-390-1828 and using access code 5497535#. Members of the public may review and comment on the proposed updates. Written comments must be submitted no later than February 18. Please see the proposed regulation page for direction for submitting written comments.

The proposed evidence-based update to the MTUS incorporate by reference the latest published guideline from American College of Occupational and Environmental Medicine (ACOEM) for the following:

— Coronavirus (COVID-19) Guideline (ACOEM December 14, 2020)

The 99 page guideline contains an analysis of the effectiveness of COVID-19 treatment using the following:

— Hydroxychloroquine and Chloroquine.
— Azithromycin.
— Favipiravir.
— lopinavir-ritonavir.
— Remdesivir.
— low-Molecular-Weight Heparin.
— IL-6 Receptor Antagonists (Tocilizumab, Sarilumab, and Siltuximab).
— Baricitinib.
— Casirivimab plus lmdevimab.
— Bamlanivimab.
— Convalescent COVID-19 Antibodies.
— Glucocorticosteroids.
— Interferon Beta-lb.
— Ribavirin.
— Zinc.
— Vitamin D.

The proposed evidence-based update to the MTUS regulations are exempt from Labor Code sections 5307.3 and 5307.4 and the rulemaking provisions of the Administrative Procedure Act. However, DWC is required under Labor Code section 5307.27 to have a 30-day public comment period, hold a public hearing, respond to all the comments received during the public comment period and publish the order adopting the update online.

A California Workers’ Compensation Institute analysis of claims reported to the state Division of Workers’ Compensation as of January 11 shows that the number of COVID-19 claims in the California workers’ compensation system more than tripled between October and November, then jumped another 64.2% to a record 23,483 claims in December. A new projection shows that the December total could climb to 37,573 cases once claims that are yet to be filed or still under investigation are added to the tally.

The latest figures show that after falling to a 6-month low in September, monthly COVID-19 claim counts began trending up in October as the fall wave of coronavirus cases hit the state.

Although not all November and December claims have been reported, the initial data from those months shows that as of the January 11, the DWC had recorded 14,298 COVID-19 claims with November injury dates, and a record 23,483 COVID-19 claims from December.

That year-end surge pushed the number of COVID-19 claims reported to the DWC for accident year (AY) 2020 to 93,470, which is 15.7% of all 2020 claims reported to the state, though with the recent spike, that proportion rose to 28.7% of all work injury claims reported for November and 47.4% of all claims reported for December.

The AY 2020 COVID-19 claim count includes 464 death claims — up 21.7% from the 381 death claims reported as of December 28 — which means COVID-19 death claims accounted for nearly half (48.0%) of the 966 work-related death claims recorded by the state for AY 2020.

Additional year-end claims continue to be filed, and CWCI’s projected COVID-19 claim count based on historical claim development that accounts for delays in COVID-19 claim reporting estimates that ultimately there will be 16,872 claims from November, and 37,573 claims from December, far surpassing the previous monthly record of 15,537 COVID-19 claims projected for July.

With hundreds of thousands of California jobs lost during the pandemic, and many workers in the state continuing to work remotely, DWC has recorded only 594,840 work injury claims for AY 2020, down 13.5% from 667,942 claims for AY 2019, despite the addition of the 93,470 COVID-19 claims.

However, the year-over-year decline in claim volume is only 6.5% if CWCI’s updated projection of the ultimate claim count for AY 2020 is used.

Other recent results show that health care workers’ share of the COVID-19 claims has declined from 44.7% in the first quarter of 2020 to 28.8% in the fourth quarter; males and younger workers continue to account for a growing share of the COVID-19 claims; and COVID-19 claim denial rates hit a 6-month high of 36.9% in October, though the denial data on claims from the last two months of 2020 is too green to be reliable.

Denial rates vary significantly by industry, with October claim denial rates ranging from 12.8% for utility workers to 66.8% for transportation workers. Many COVID-19 claims are denied because the claimants do not test positive for the virus.

The latest results on California workers’ comp COVID-19 claims are from the January 11 update to CWCI’s COVID-19/Non-COVID-19 Interactive Claim App, which integrates data from CWCI, DWC, and the Bureau of Labor and Statistics to provide information on California work injury claims from comparable periods of 2019 and 2020. The app is updated biweekly and is available to the public here.

A major labor union and several ride-hailing drivers are suing to overturn a newly passed ballot measure classifying gig workers as independent contractors in California.

The Washington Post reports that the groups filed suit Tuesday in California’s Supreme Court, alleging Proposition 22 violates the state constitution and limits the power of state legislators to implement certain worker protections they are authorized to grant.

The suit, filed by Service Employees International Union and a group of ride-hailing drivers, asks the state Supreme Court to invalidate Prop 22, which cemented gig driver’s status as independent contractors after more than 58 percent of voters supported it in November.

They argue the measure limits state legislators’ ability to implement a system of workers’ compensation in defiance of their constitutional authority to do so. It also argues that the proposition unconstitutionally defines what comprises an amendment to the measure, as well as violating a rule limiting ballot measures to a single subject to prevent voter confusion.

The Protect App-Based Drivers and Services coalition, which represents gig companies such as Uber, Lyft and Doordash, criticized the lawsuit in a statement attributed to Uber driver Jim Pyatt, an activist who has worked in favor of Prop 22.

The groups that filed the suit, which also include SEIU California State Council, took particular issue with the measure’s inclusion of a provision requiring a seven-eighths legislative supermajority to amend and even define what constitutes an amendment. That authority, they say, is vested with the courts.

The lawsuit blasts the measure’s drafters as having “impermissibly” usurped this Court’s authority to ‘say what the law is’ by determining what constitutes an ‘amendment.’”

Further, they argued, they violated the single-subject rule by “burying these cryptic amendment provisions on subjects not substantively addressed in the measure, and in language that most voters would not understand.”

They said they were suing in the state Supreme Court rather than a lower court because the issues were of broad public importance and required a speedy resolution to minimize harm to gig workers.