Tag: 2024 News

The Equal Employment Opportunity Commission filed a lawsuit in September 2023 in the United States District Court for the Northern District of California against Tesla, Inc.under Title VII of the Civil Rights Act of 1964 for claims arising from Tesla’s race-based employment practices.

The Commission alleges Tesla has subjected Black employees at its Fremont, California manufacturing facilities to severe or pervasive racial harassment and has created and maintained a hostile, race-based work environment there since May 2015. The N-word and other racial slurs, epithets, and stereotyping “permeated Tesla’s Fremont Factory.” Non-Black managers, non-managerial employees, and temporary workers directly addressed Black employees individually and collectively using the N-word.Other race-based slurs and insults were frequently used as well.

At work, Black employees allegedly encountered racist graffiti-including swastikas, death threats, and nooses on bathroom walls, desks, elevators, and equipment. Black employees describe the use of slurs and racist imagery as “casual and normal,” “frequent,” “constant,” “a regular thing,” and occurring “too many times to count.”

Non-Black employees allegedly used slurs and epithets openly in high-traffic work areas and hubs. Supervisors and managers witnessed racially offensive conduct but failed or refused to intercede. Black employees reported the slurs, insults, graffiti, and misconduct to Tesla’s human resources, employee relations, and managerial personnel. Tesla failed to investigate complaints of racial misconduct, adopt policies or practices to ensure its temporary workforce did not perpetuate racial harassment at the Fremont Factory, or otherwise take remedial action to end the ongoing racial harassment.

Tesla’s supervisors and human resources officials allegedly retaliated against Black employees by changing their schedules, assigning them less desirable duties, writing them up without justification, and firing them within weeks of reporting the ongoing racial harassment and discrimination.

Tesla filed a motion to stay the proceedings under the Colorado River doctrine and on the grounds the Commission failed to engage in pre-suit conciliation, and also a motion to dismiss based on the Commission’s failure to identify any member of the alleged group of victims. And also because the EEOC did not allege all three elements of a prima facie retaliation claim. On March 29, 2024 the court denied all three motions.

In Colorado River Water Conservation Dist. v. United States, 424 U.S. 800, the U.S.Supreme Court recognized “in exceptional circumstances, considerations of wise judicial administration, giving regard to conservation of judicial resources and comprehensive disposition of litigation can support a stay of federal litigation in favor of parallel state proceedings.

Tesla insists this action is substantially similar to two state court actions now before Alameda County Superior Court Judge Grillo: Department of Fair Employment and Housing v. Tesla, Inc., Alameda County Superior Court No. 22CV006830, and Vaughn, et al. v. Tesla, Inc., et al., Alameda County Superior Court No. RG 17882082.

In the Vaughn Case, filed July 2021, the plaintiffs sue Tesla for race-based harassment and discrimination and failure to prevent race-based harassment and discrimination in violation of California’s Fair Employment and Housing Act. In the Civil Rights Department Case, filed in March 2022, California’s Department of Fair Employment and Housing initiated an enforcement action for group relief against Tesla on behalf of California and aggrieved Black Fremont Factory workers, alleging racial harassment, employment discrimination based on race, retaliation, failure to prevent racial harassment and discrimination, and recordkeeping violations.

Tesla asserts the state court actions are substantially similar to this action because 1) “the putative class in the Vaughn Case and the alleged aggrieved group in the [Civil Rights Department] Case include all African American workers at the Factory within the statutory periods,” and 2) the Commission’s complaint is based on the same factual allegations and seeks to vindicate the same legal rights as some claims in the state court actions.

However the court noted that “a Colorado River stay is inappropriate when the state court proceedings will not resolve the entire case before the federal court. If there is any substantial doubt as to whether the state court actions will completely and promptly resolve the issues between the parties, it would be a serious abuse of discretion to grant the stay or dismissal at all.”

Between July 2022 and June 2023, the Commission engaged in conciliation efforts with Tesla, including a seven-hour, in-person conciliation session on June 13, 2023. So, the Commission tried to engage Tesla in discussions to provide Tesla the opportunity to remedy the allegedly discriminatory practice. A court looks only to whether the EEOC attempted to confer about a charge, and not to what happened.

Tesla’s argument for dismissal based on the Commission’s failure to identify any member of the alleged group of victims failed because the Commission brings this enforcement action in its own name, so the Commission is not required to identify an aggrieved individual to survive Tesla’s motion to dismiss.

The complaint is not required to plead a prima facie case of retaliation as long as it contains “a short and plain statement of the claim showing that the pleader is entitled to relief,” Swierkiewicz v. Sorema N. A., 534 U.S. 506. at 508 (quoting Federal Rule of Civil Procedure 8(a)(2)).

On March 27, 2024, the Appeals Board issued its opinion in Sandra Ja’Chim Scheuing v Lawrence Livermore National Library -ADJ8655364; -ADJ14830172, and designated it as a significant panel decision.

Significant panel decisions are not binding precedent in workers’ compensation proceedings; however, they are intended to augment the body of binding appellate court and en banc decisions and, therefore, a panel decision is not deemed “significant” unless, among other things: (1) it involves an issue of general interest to the workers’ compensation community, especially a new or recurring issue about which there is little or no published case law; and (2) all Appeals Board members have reviewed the decision and agree that it is significant.

In Ja’Chim Scheuing, the Appeals Board discussed its approach to cases where a petition for reconsideration is timely filed, but the case is not timely received by the Appeals Board, and clarified that the Appeals Board will continue to follow the long-time precedent in Shipley v. Workers’ Comp. Appeals Bd. (1992) 7 Cal.App.4th 1104, 1108 [57 Cal.Comp.Cases 493].

Sandra Ja’Chim Scheuing requested reconsideration of the Findings & Award issued by a WCJ who found her injury caused permanent disability of 28%. Applicant contends on reconsideration that she is 100% permanently and totally disabled, and that the WCJ failed to fully consider all of the medical and vocational evidence in making his determination. In this case, the WCJ issued the Findings & Award on December 1, 2023, and applicant filed a timely Petition for Reconsideration on December 18, 2023 at the Oakland district office. As required by Rule 10205.4 (Cal. Code Regs., tit. 8, § 10205.4).

Her paper Petition was scanned into the Electronic Adjudication Management System (EAMS). (See Cal. Code Regs., tit. 8, §10206 [electronic document filing rules], § 10205.11 [manner of filing of documents].)  When a petition is filed, a task is sent to the WCJ through EAMS so that the WCJ receives notice that a Report is required. (See Cal. Code Regs., tit. 8, §10206; 10962.) No such notice is provided to the Appeals Board. Thereafter, the district office electronically transmits the case to the Appeals Board through EAMS and notifies the Appeals Board that it has been transmitted.

There are 25 days allowed within which to file a petition for reconsideration from a “final” decision that has been served by mail upon an address in California. (Lab. Code, §§ 5900(a), 5903; Cal. Code Regs., tit. 8, § 10507(a)(1).) This time limit is extended to the next business day if the last day for filing falls on a weekend or holiday. (Cal. Code Regs., tit. 8, § 10508.) To be timely, however, a petition for reconsideration must be filed (i.e., received) within the time allowed; proof that the petition was mailed (posted) within that period is insufficient. (Cal. Code Regs., tit. 8, §§ 10845(a), 10392(a).)

Here, according to Events in EAMS, which functions as the “docket,” although the Petition for Reconsideration was timely filed on December 18, 2023 at the Oakland district office, the district office transmitted the case to the Appeals Board on February 21, 2024. Thus, the first notice to the Appeals Board of the Petition was on February 21, 2024. Thereafter, the WCJ issued the Report on February 27, 2024. Due to this lack of notice by the district office, the Appeals Board failed to act on the Petition within 60 days, through no fault of the parties.

Therefore, considering that applicant filed a timely Petition for Reconsideration and that the Appeals Board’s failure to act on that Petition was a result of administrative error, “we conclude that our time to act on applicant’s Petition was tolled until 60 days after February 21, 2024.”

Once a case is pending at the Appeals Board, parties may not submit new evidence or raise new issues, unless the Appeals Board specifically provides notice and orders further proceedings to consider further evidence and/or issues. (See Lab. Code, §§ 5906, 5907, 5908(a).)

Here, applicant did not seek permission to file supplemental pleadings as required by WCAB Rule 10964. While WCAB Rule 10964 does not require the Appeals Board to accept supplemental pleadings, the Appeals Board may exercise its discretion to accept a supplemental pleading and consider it. Here the WCAB accepted applicant’s letters of February 22, 2024 and March 1, 2024 for filing as supplemental pleadings and considered them.

“We believe that as a matter of due process, once a party has confirmed timely filing of a petition under WCAB Rule 10615 (Cal. Code Regs., tit. 8, § 10615), they should be able to reasonably expect that the petition will be considered by the Appeals Board. As explained above, until it is transmitted to the Appeals Board, the case remains at the district office level, and all status inquiries should be directed to the district office. When the 60- day period in section 5905 has expired and there has been no response by the Appeals Board, we recommend that the parties contact the district office to confirm that the case has been transmitted to the Appeals Board and that notice was provided to the Appeals Board. Once they have received this confirmation from the district office, they may follow up by email with the Appeals Board’s Control Unit at ControlUnit@dir.ca.gov.”

This time limit is jurisdictional and therefore, the Appeals Board has no authority to act upon or consider an untimely petition for reconsideration. (Maranian v. Workers’ Comp. Appeals Bd. (2000) 81 Cal.App.4th 1068, 1076 [65 Cal.Comp.Cases 650, 656];  Rymer v. Hagler(1989) 211 Cal.App.3d 1171, 1182; Scott v Workers’ Comp. Appeals Bd. (1981) 122 Cal.App.3d 979, 984 [46 Cal.Comp.Cases 1008, 1011]; U.S. Pipe & Foundry Co. v. Industrial Acc. Com. (Hinojoza) (1962) 201 Cal.App.2d 545, 549 [27 Cal.Comp.Cases 73, 75-76].)

In contrast, here, applicant’s Petition for Reconsideration was timely filed on December 18, 2023, seventeen days after the WCJ’s decision of December 1, 2023. Thus, as explained above, the Appeals Board has the authority to act upon the Petition and to consider it.

Former licensed insurance agent Brett E. Lovett, 53, of Camarillo was found guilty of 29 felony counts including grand theft, elder abuse, money laundering, and burglary after a 15-month California Department of Insurance investigation found he defrauded at least nine victims, including senior citizens, of close to $1.2 million.

Lovett was arrested in October 2017 along with Robert C. Burlisonnof La Canada after the Department’s investigation revealed that between 2011 and 2016, Lovett defrauded at least nine victims. Several of his victims were senior citizens whom he met and befriended at a place of worship in Carpinteria. Other victims sought legal advice from Lovett through his legal aid information business.

Burlison, a licensed California attorney and owner of Burlison Law Group in Pasadena, California, was alleged in the felony complaint to have aided and conspired with Lovett. According to an article in the Los Angeles Times, Burlison denied any wrongdoing and said he has “no connection at all” to Lovett – that he was also a victim of his fraud.

“Somehow, the Department of Insurance thinks he’s a bad guy, and that I conspired with him, and that’s the furthest from the truth,” Burlison said in an interview. “That is not me, it did not occur.”

Victims entrusted Lovett with their money for proposed investments that never existed, or for financial management purposes. Lovett then misappropriated the money for his own personal use and to repay some of his victims — sometimes using his Power of Attorney and Promissory Notes to embezzle funds from victims.

“This former licensed insurance agent preyed on innocent senior citizens to line his pockets with no regard for his victims’ wellbeing,” said Insurance Commissioner Ricardo Lara. “Thanks to the hard work by my Department investigators and the Santa Barbara County District Attorney’s Office his victims will have justice.”

Lovett has a history of embezzling money from members of the places of worship he attends.

In 2007, doing business as Northwest Asset Fund, he was ordered to pay more than $675,900 in restitution, fines and sanctions by the U.S. Commodity Futures Trading Commission (CFTC). Lovett never paid the fines or restitution.

The CFTC entered a permanent injunction against Lovett, who never registered with the CFTC. Between October 2002 and August 2005, Lovett fraudulently solicited money from individuals, purportedly to trade commodity futures, through false promises of high returns from a low-risk investment.

Lovett’s license to transact insurance expired in May 2000. He was not acting as an insurance agent during this time, but he was giving financial advice which he was not licensed to give.

Lovett is scheduled to return to court for sentencing on May 9, 2024. The Santa Barbara County District Attorney’s office is prosecuting the case.

State Bar records reflect that Burlison was disbarred in 2019 after he stipulated to committing three acts of professional misconduct related to a single client matter.

Elinton Gramajo worked as a delivery driver for Joe’s Pizza from February 2014 to June 2015.

In February 2018,he sued Joe’s Pizza on Sunset, Inc.; Joe’s Pizza on Sunset, LLC; and Giuseppe Vitale for failure to pay minimum and overtime wages (Lab. Code, §§ 510, 558, 1194), failure to provide rest and meal periods (Lab. Code, §§ 512, 226.7), failure to pay wages due at time of termination (Lab. Code, §§ 201, 202, 203), failure to reimburse for business expenses (Lab. Code, § 2802), and unfair business practices (Bus. & Prof. Code, § 17200). Gramajo also sought declaratory and injunctive relief.

After nearly four years of litigation and extensive discovery, the matter was set for trial in October 2021. Gramajo sought $26,159.33 in unpaid minimum and overtime wages, missed meal and rest breaks, waiting time penalties, and unreimbursed expenses. After a seven-day trial, the jury found in favor of Gramajo on his minimum wage and overtime causes of action. The jury awarded Gramajo $2.17 in unpaid minimum wages and $3,340 in unpaid overtime wages. In total, Gramajo recovered $7,659.63, consisting of the unpaid minimum and overtime wages; $2,115.59 in statutory interest; $2,100 in waiting time penalties calculated at the daily wage rate of $70 per day for thirty days per Labor Code section 203; $2.17 in liquidated damages; and $100 in statutory penalties.

Gramajo moved for attorney fees totaling $296,920 for 228.4 hours billed at $650 per hour and applying a multiplier of two. Gramajo also requested $26,932.84 in costs. Joe’s Pizza opposed the fee request and moved to tax Gramajo’s costs in their entirety.

The trial court denied Gramajo’s fee request and granted Joe’s Pizza’s motion to tax costs, ultimately awarding Gramajo nothing. The trial court found Gramajo acted in bad faith by artificially inflating his damages figure and including equity claims he never intended to pursue to justify filing the case as an unlimited civil proceeding. The trial court noted Gramajo sought $26,159.33 at trial, just over the jurisdictional amount, which included $10,822.16 in unreimbursed expenses.

In trial, however, Gramajo never introduced any evidence to support his expense claim. Similarly, Gramajo never pursued injunctive or declaratory relief at trial despite requesting that relief in his complaint. The trial court also found the case was severely over litigated, noting Gramajo had propounded 15 sets of written discovery requests and noticed 14 depositions despite only admitting 12 exhibits at trial.

On appeal, Gramajo argues the trial court should have awarded him reasonable litigation costs under Labor Code section 1194, subdivision (a), and abused its discretion by applying Code of Civil Procedure section 1033, subdivision (a), to deny those costs in their entirety.

The Court of Appeal agreed with Gramajo in the published case of Gramajo v. Joe’s Pizza on Sunset, Inc. -B322697 (March 2024).

Code of Civil Procedure section 1033 gives the trial court discretion to deny litigation costs based on the amount recovered while Labor Code section 1194 provides for a mandatory cost award regardless of that amount. Neither statute address the question of which one should control in this area of overlap.

The Court of Appeal held the “Labor Code section 1194, subdivision (a), controls given the legislative intent behind Labor Code section 1194, subdivision (a), and because that statute is more recently enacted and more specific relative to Code of Civil Procedure section 1033.”

It concluded that ” employees who prevail in actions to recover unpaid minimum and overtime wages are entitled to their reasonable litigation costs under Labor Code section 1194, subdivision (a), irrespective of the amount recovered.

It however expressed no opinion on the reasonableness of Gramajo’s requests for litigation costs. Accordingly, it reversed and remanded the matter for the trial court to determine a reasonable fee and cost award.

The California Flats Solar Project is a solar power facility located on privately owned land in Monterey and San Luis Obispo Counties. First Solar Electric, Inc. owns the facility. A subcontractor hired George Huerta and other workers to assist CSI Electrical Contractors, the company providing “procurement, installation, construction, and testing services” at the Site. A designated road provided access between a guard shack located at the Site’s perimeter and the employee parking lots. A security gate was located on that road several miles from the guard shack; from the Security Gate, it would take Huerta approximately 10 to 15 minutes to reach the parking lots. Huerta underwent security checks at the Security Gate and was told by CSI management that this gate was the “first place” he had to be at the beginning of the workday.

In the morning, vehicles formed a long line outside the Security Gate, where guards scanned each worker’s badge and sometimes peered inside vehicles and truck beds. At the end of the day, workers again formed a long line inside the Security Gate, where the exit procedure took place. The exit procedure could take up to a minute or more per vehicle and caused delays of five to over 30 minutes. CSI told Huerta that security guards had the right to search vehicles during the entry and exit processes, and the guards visually inspected the bed of his truck for stolen tools or endangered species. Huerta was not paid for the time he spent waiting to pass through the Security Gate at the beginning or end of the workday.

Because two endangered species were present near the Site, the Department of Fish and Wildlife required First Solar to obtain an Incidental Take Permit (ITP) before work could begin on the project. The ITP imposed a speed limit of 20 miles per hour on the access road between the guard shack and the parking lots, and restricted the roads that could be taken at the Site. It also required a biologist to monitor the Site to minimize disturbances to species’ habitats. As part of this monitoring, the biologist each morning ensured that the road between the guard shack and the parking lots was clear of endangered species before anyone could enter the Site. On some occasions, this clearing process added to the time Huerta spent waiting in line to enter the worksite in the morning.

As First Solar’s subcontractor, CSI was required to abide by the ITP and was required to ensure that its employees did as well. After passing through the Security Gate each morning, Huerta was subject to the rules imposed by the ITP in addition to other rules governing his conduct. CSI required adherence to speed limits between five and 20 miles per hour; restricted travel to driving on the access road to reach the Site, thereby prohibiting employees from driving on other roads near the Site or walking or biking from the Security Gate to the parking lots; and prohibited employees from honking their horns, playing music that could be heard outside of their vehicles, or otherwise disturbing local wildlife. Violation of these rules or other Site rules could result in suspension or termination. Huerta was not paid for the time he spent driving between the Security Gate and the employee parking lots.

Huerta’s employment was governed by two collective bargaining agreements (CBAs), which specified that the standard workday included an unpaid 30-minute meal period. CSI did not allow workers to leave the Site during the workday and instructed workers to spend their meal periods at a designated area near their assigned worksite (Installation Site). In accordance with the CBAs, Huerta was not paid for his meal periods.

Huerta filed a wage and hour class action in the Superior Court of Monterey County on behalf of himself and all others similarly situated against CSI, seeking payment for unpaid hours worked. The suit was removed to the United States District Court for the Northern District of California. The district court granted Huerta’s motion for class certification. CSI then filed a motion for partial summary judgment on the class claims Huerta raised in his first amended complaint; that motion was granted by the district court. CSI filed a second motion for partial summary judgment on the class claim that survived the first motion for partial summary judgment. This second motion was also granted.

Huerta timely appealed the orders granting CSI’s motions for summary judgment to the Ninth Circuit, which certified three questions to the California Supreme Court which answered those questions in the case of Huerta v CSI Electrical Contractors S275431 (March 2024). The request from the Ninth Circuit was to answer three questions about Wage Order No. 16 and the scope of the term “hours worked.”  Industrial Welfare Commission wage order No. 16-2001 (Wage Order No. 16) governs wages, hours, and working conditions in the construction, drilling, logging, and mining industries. (Cal. Code Regs., tit. 8, § 11160.) It entitles certain employees in these industries to at least minimum wage compensation for “hours worked.”

First: “Is time spent on an employer’s premises in a personal vehicle and waiting to scan an identification badge, have security guards peer into the vehicle, and then exit a Security Gate compensable as ‘hours worked’ within the meaning of . . . Wage Order No. 16?” (Huerta v. CSI Electrical Contractors, Inc. (9th Cir. 2022) 39 F.4th 1176, 1177 (Huerta).)

Second: “Is time spent on the employer’s premises in a personal vehicle, driving between the Security Gate and the employee parking lots, while subject to certain rules from the employer, compensable as ‘hours worked’ or as ‘employer-mandated travel’ within the meaning of . . . Wage Order No. 16?” (Ibid.)

And third: “Is time spent on the employer’s premises, when workers are prohibited from leaving but not required to engage in employer-mandated activities, compensable as ‘hours worked’ within the meaning of . . . Wage Order No. 16, or under California Labor Code Section 1194, when that time was designated as an unpaid ‘meal period’ under a qualifying collective bargaining agreement?” (Ibid.)

And the Supreme Court provided the answers to each question. “First, an employee’s time spent on an employer’s premises awaiting and undergoing an employer-mandated exit procedure that includes the employer’s visual inspection of the employee’s personal vehicle is compensable as “hours worked’ within the meaning of Wage Order No. 16, section 2(J).“

“Second, the time that an employee spends traveling between the Security Gate and the employee parking lots is compensable as ’employer-mandated travel’ under Wage Order No. 16, section 5(A) if the Security Gate was the first location where the employee’s presence was required for an employment-related reason other than the practical necessity of accessing the worksite. Separately, this travel time is not compensable as ‘hours worked’ because an employer’s imposition of ordinary workplace rules on employees during their drive to the worksite in a personal vehicle does not create the requisite level of employer control.”

“Third, when an employee is covered by a collective bargaining agreement that complies with Labor Code section 512, subdivision (e) and Wage Order No. 16, section 10(E), and provides the employee with an ‘unpaid meal period,’ that time is nonetheless compensable under the wage order as ‘hours worked’ if the employer prohibits the employee from leaving the employer’s premises or a designated area during the meal period and if this prohibition prevents the employee from engaging in otherwise feasible personal activities. An employee may bring an action under Labor Code section 1194 to enforce the wage order and recover unpaid wages for that time.”