The California Industrial Welfare Commission (IWC) was established to regulate wages, hours, and working conditions in California. Importantly, the IWC adopted “wage orders,” which establish specific rules for various industries. California has not funded the IWC since 2004, and it has not been in operation. This is likely to change.
California Governor Gavin Newsom signed
In August 2023, the U.S. District Court for the District of Arizona joined “the growing number of courts that have concluded” that judicial approval of Fair Labor Standards Act (FLSA) settlements “is neither authorized or necessary.” In Evans v. Centurion Managed Care of Arizona LLC[1], the plaintiff asserted individual claims under the FLSA for unpaid overtime and failure to pay minimum wages. Following the parties’ settlement of the plaintiff’s claims on an individual basis, the parties moved for approval of the settlement, submitting to the court a redacted version of the settlement agreement and a joint motion to file portions of the settlement agreement, including the settlement amount, under seal.Continue Reading District of Arizona Addresses Judicial Approval of Individual Fair Labor Standards Act Settlements
The U.S. Department of Labor (DOL) published a Notice of Proposed Rulemaking on August 30, 2023, which proposes revisions to the regulations issued under the Fair Labor Standards Act (FLSA). The proposed rule seeks to increase the federal minimum salary threshold required for employees to qualify as exempt employees to roughly $55,000 per year.Continue Reading Department of Labor Seeks To Raise the Federal Minimum Salary Required To Qualify as an Exempt Employee for Fair Labor Standards Act Purposes
A federal court in Arizona recently rejected a defense for Arizona employers seeking to avoid liability for unpaid wages under the Arizona Wage Act. In Arrison v. Walmart, the district court held that there is no “employer knowledge” requirement under the AWA, rejecting Walmart’s attempt to defeat an unpaid wages class action against the
Effective January 1, 2024, California’s minimum wage will increase to $16.00 per hour for all employers, regardless of size. Under California’s Labor Code, by August 1 of each year, the director of finance will determine if the minimum wage must be adjusted for inflation and, if so, calculate the increase in minimum wage by the
In the latest development in California’s evolving independent contractor laws, the Los Angeles City Council approved a new ordinance that provides protections for certain independent contractors providing services in Los Angeles. Beginning on July 1, 2023, the Freelance Worker Protections Ordinance (Ordinance) requires that any contract between a hiring entity and a freelance worker valued at $600 or more (either by itself or when combined with previous written or oral contracts between the parties in a given calendar year) be in writing and include, among other things: (1) an itemization of all services the freelance worker provides, (2) the value of the services to be provided pursuant to the contract, and (3) the date by which the entity must pay the contracted compensation or the manner by which that payment date will be determined. Under the Ordinance, a freelance worker is an individual natural person, or an entity whose interests are entirely held by and whose work is performed entirely by no more than one individual natural person. A hiring entity is defined as an entity regularly engaged in business or commercial activity, including a nonprofit business, but excluding companies that hire app-based transportation and delivery drivers to provide prearranged services.Continue Reading Freelance Worker Protections Ordinance for Independent Contractors in Los Angeles
On July 11, 2023, in Thai v. International Business Machines Corp. (IBM), a three-justice panel of the California First District Appellate Court overturned a trial court’s dismissal of a claim by an employee that the employer violated California law when it failed to reimburse employees for work-from-home expenses during the COVID-19 pandemic.
Plaintiff and a putative class sought penalties under California Labor Code Section 2802, which requires employers to reimburse their employees for “all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties,” including that they sought the cost of equipment purchased, when they were ordered to work from home in 2020.Continue Reading California Appeals Court Rules Employer Must Reimburse Employees for Work-From-Home Expenses During COVID-19 Pandemic
The National Labor Relations Board (NLRB or the Board) issued a decision on June 16, 2023, returning to an Obama-era standard used to determine whether a worker is an employee or an independent contractor under the National Labor Relations Act (NLRA or the Act). While employees have rights under the NLRA, independent contractors do not.
As reported earlier this year, California’s state minimum wage increased to $15.50 per hour for all employers on January 1, 2023. However, some California employers may face another minimum wage increase on July 1, 2023. This is due to the adoption by many cities and counties in California of their own local minimum wage rates above the California state minimum wage for employees working within their jurisdiction. If a locality provides a higher minimum wage rate than the state rate, the employer must pay the higher local wage rate.Continue Reading Minimum Wage Increases To Take Place on July 1, 2023, for Some California Localities
The U.S. Court of Appeals for the Third Circuit, in Higgins v. Bayada Home Health Care Inc., held that it is not a violation of the Fair Labor Standards Act (FLSA) for an employer to deduct time from an exempt employee’s paid time off (PTO) bank for failing to meet a productivity target. The employer in the case had developed a point-based system to ensure that employees met certain “productivity minimums,” with various tasks being assigned a certain number of “productivity points.” When employees consistently exceeded their productivity minimums, they received additional compensation. When employees failed to meet their weekly productivity minimums, however, their available PTO was deducted. The employer did not deduct from an employee’s salary once PTO had been exhausted.Continue Reading Third Circuit Rules Paid Time Off Is Not Part of an Exempt Employee’s Salary