Frequently Asked Questions
Why should I hire your firm?
Stephen Danz & Associates is a statewide California employee-side law firm. We only represent employees and never take cases defending employers. Our attorneys work with Stephen Danz himself and are all skilled in negotiation and trial practice. We are first and foremost litigators, which scares most employers, because going to trial costs them a great deal.
What kind of experience do you have?
Stephen Danz himself has over thirty years of experience ONLY DEFENDING EMPLOYEES against the unlawful acts of their employers. When you add up all of the years of experience of Stephen and his associates, it amounts to hundreds of years of practice!
How much will hiring you cost me?
Unlike many firms, we do not ask for costly retainers up front. In fact, we do not collect any attorney’s fees unless YOU WIN YOUR CASE OR REACH A SETTLEMENT. We take cases on a contingency, as we feel that this gives us some ‘skin in the game’ right there along with you. We suddenly become ‘partners’ working towards a judgment or settlement right there alongside you.
How many cases have you won?
This is a common question and one that is impossible to answer. We spend a considerable amount of time going over the facts of your case with you before we even agree to take your case. As such, we have a pretty good idea for each client whether or not they will see a favorable recovery. Most of our cases settle or proceed to trial. And a win can mean different things to different clients. Some clients only want to tell their side of the story, want reinstatement, or a letter of apology. Some clients want a large settlement or judgment so the results are varied.
Do we have to go to trial to win?
The simple answer to this common question is, NO. But as an attorney, I can’t just give a one-word answer to any question, no matter how simple! The truth is, many cases settle during settlement conferences, mediations, or arbitrations. Very few of them actually proceed to trial simply because employers run the risk of generating HUNDREDS OF THOUSANDS OF DOLLARS in attorney’s fees if they do decide to fight these cases.
Now, having said that, WE MUST ALWAYS BE PREPARED TO GO TO TRIAL, and we treat every case as if it is going to trial. We never give the other side an indication that we are doing anything but proceeding to a trial for your case. If they back down and offer us the settlement we are requesting, then we will talk about a settlement. Until then, we intend to fight every case to the end.
Will I have to testify?
If your case does proceed to trial, you will probably need to be prepared to testify. Judges and juries want to hear your side of the story if they are going to award a judgment in your favor. Now, having said that, if your case does proceed to trial (or even if it doesn’t), you will be completely prepared long before then to answer any questions the defense attorney might throw our way. You will have gone through depositions (where we sit down with opposing counsel and a court reporter and they ask you questions with one of our attorneys by your side) and we will have gone over your testimony with you so that you are comfortable with the back and forth questioning by defense attorneys and how to handle objections when they are raised. We will not put you on the stand until you have been fully prepared by our expert litigators.
When will I get my money?
Many attorneys and law firms accept cases and then enter a lengthy SETTLEMENT PHASE. During this part of the case they send letters back and forth between attorneys for both sides, each attorney then meets with his or her client, they discuss how to respond and then the attorney writes a letter back. This back and forth exchange can take months, if not a year. Attorneys prefer to do it this way on the chance that they might be able to get a settlement without actually having to do much work. They write a few letters, make a few phone calls, have a meeting or two and then get a check.
We do not believe that this attitude serves the best interest of our clients. It does not force employers to take us seriously and it does not motivate them to return with their best possible offer. When we take a case, we gather the facts and prepare to go to trial. We file a complaint with the court, thereby forcing your employer to take the case seriously in order to avoid lengthy and expensive discovery. Discovery is the part of a case when each side must produce the evidence requested by the other side and send its witnesses to attend depositions. This can be incredibly expensive for employers and an effective motivating factor in getting them to settle the case. Once they see how seriously we take the case, and how expensive it is going to be for them to fight it, they often approach the settlement negotiations with a willingness to make a reasonable offer.
However, this process can often take a year to complete…setting court hearings is no quick matter as courts are backlogged for months at a time. Setting depositions and settlement conferences can also take several months. Rest assured, we do everything we can to move your case along. Any stalling only hurts our chances of recovery.
What are the laws that protect me from discrimination?
There are two types of laws that protect employees (and in California others, as well) from discrimination: Federal and State laws.
· The United States Constitution, Amendments 4, 5, and 14 begin the prohibition against discrimination, by requiring federal agencies to afford ‘due process’ and ‘equal rights’ to individuals, guaranteeing the rights to life, liberty and the pursuit of happiness, and then applying those same ideals to the States.
· Section 1981 of the US Code provides additional federal remedies to deter harassment and intentional discrimination in the workplace.
· Title VII of the Civil Rights Act of 1964 (Title VII) prohibits employment discrimination based on race, color, religion, sex, or national origin;
· The Equal Pay Act of 1963 (EPA) requires employers to pay men and women equally if they are performing substantially the same work;
· The Age Discrimination in Employment Act of 1967 (ADEA), which protects individuals who are 40 years of age or older from all forms of discrimination in hiring, firing, promoting, overtime assignment, wages, benefits and any other terms or conditions related to employment;
· The Americans with Disabilities Act Amendments Act (ADAAA) prohibits employment discrimination against individuals who are otherwise qualified for the job but are disabled, also requires employers to provide reasonable accommodations to employees with disabilities, applies to private and public sector employers;
· Sections 501 and 505 of the Rehabilitation Act of 1973 applies prohibitions against discrimination against people with disabilities that work for the federal government; and
· The Civil Rights Act of 1991, which, among other things, provides monetary damages in cases of intentional employment discrimination.
The U.S. Equal Employment Opportunity Commission (EEOC) enforces federal anti-discrimination laws.
Other federal laws, not enforced by EEOC, also prohibit discrimination and reprisal against federal employees and applicants. The Civil Service Reform Act of 1978 (CSRA) contains a number of prohibitions, known as prohibited personnel practices, which are designed to promote overall fairness in federal personnel actions. 5 U.S.C. 2302. The CSRA prohibits any employee who has authority to take certain personnel actions from discriminating for or against employees or applicants for employment on the bases of race, color, national origin, religion, sex, age or disability. It also provides that certain personnel actions cannot be based on attributes or conduct that do not adversely affect employee performance, such as marital status and political affiliation. The Office of Personnel Management (OPM) has interpreted the prohibition of discrimination based on conduct to include discrimination based on sexual orientation. The CSRA also prohibits reprisal against federal employees or applicants for whistle-blowing, or for exercising an appeal, complaint, or grievance right. The CSRA is enforced by both the Office of Special Counsel (OSC) and the Merit Systems Protection Board (MSPB).
The Department of Fair Employment and Housing, is responsible for enforcing (much like the EEOC on a federal level) the provisions of Fair Employment and Housing Act (FEHA), Unruh and other state laws designed to protect workers from discrimination in California. The Department also enforces the California Family Rights Act, and The Ralph Civil Rights Act.
· CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT (FEHA) protects California employees from discrimination, sexual harassment, and retaliation. The Act protects not only California employees but also prohibits discrimination in housing.
The Act prohibits discrimination based on:
o Age (40 and over)
o Religious Creed (including religious dress and grooming practices)
o Denial of Family and Medical Care Leave
o Disability (mental and physical) including HIV and AIDS
o Marital Status
o Medical Condition (cancer and genetic characteristics)
o Genetic Information
o National Origin (including language use restrictions)
o Sex (which includes pregnancy, childbirth, breastfeeding and medical conditions related to pregnancy, childbirth or breastfeeding)
o Gender, Gender Identity, and Gender Expression
o Sexual Orientation
· THE UNRUH CIVIL RIGHTS ACT is more pervasive than the Fair Employment and Housing Act as it goes well beyond employment practices and applies to ALL BUSINESSES such as hotels and motels, restaurants, theaters, hospitals, barber and beauty shops, housing accommodations, and retail establishments, protecting clients, customers, and others. It prohibits any form of discrimination based on the characteristics listed as being protected by FEHA. The Act says specifically:
“All persons within the jurisdiction of this state are free and equal, and no matter what their sex, race, color, religion, ancestry, national origin, disability, medical condition, genetic information, marital status, or sexual orientation are entitled to the full and equal accommodations, advantages, facilities, privileges, or services in all business establishments of every kind whatsoever.”
An action in Unruh can be brought to DFEH or pursued privately, without the need for a Right to Sue letter.
· THE CALIFORNIA FAMILY RIGHTS ACT (CFRA) was established to protect an employee’s right to a leave of absence in the event of:
o Child birth for bonding
o Placement of a child through adoption
o For the serious health condition of a child, parent or spouse
o For the employee’s own serious health condition.
The Act also allows for protection from discrimination for pregnancy and pregnancy related conditions and for retaliation against employees for taking advantage of its leave provisions.
· THE RALPH CIVIL RIGHTS ACT prohibits violence or threats of violence based on an individual’s:
o Genetic Information
o National Origin
o Marital Status
o Medical Condition (cancer and genetic characteristics)
o Political Affiliation
o Position in a Labor Dispute
o Sex (which includes pregnancy, childbirth, and medical conditions related to pregnancy or childbirth, gender, gender identity, and gender expression)
o Sexual Orientation
Which lead to a bigger judgment, State or Federal laws?
In our opinion, it is generally more advantageous to file your case in California courts, rather than Federal court. State courts are far more concerned with employee’s rights than are the Federal courts and often judgments favorable to employees are impossible to come by in Federal court. Of course, only an experienced employment law attorney would know this, which is the reason many employment attorneys only seek to go to settlement conferences or mediation, rather than proceed to trial in Federal court.
What Discriminatory Practices Are Prohibited by These Laws?
Under Title VII, the ADA, and the ADEA, it is illegal to discriminate in any aspect of employment, including:
· hiring and firing;
· compensation, assignment, or classification of employees;
· transfer, promotion, layoff, or recall;
· job advertisements;
· use of company facilities;
· training and apprenticeship programs;
· fringe benefits;
· pay, retirement plans, and disability leave; and
· other terms and conditions of employment.
Other forms of discrimination include:
· harassment on the basis of race, color, religion, sex, national origin, disability, or age;
· retaliation against an individual for filing a charge of discrimination, participating in an investigation, or opposing discriminatory practices;
· employment decisions based on stereotypes or assumptions about the abilities, traits, or performance of individuals of a certain sex, race, age, religion, or ethnic group, or individuals with disabilities; and
· denying employment opportunities to a person because of marriage to, or association with, an individual of a particular race, religion, national origin, or an individual with a disability. Title VII also prohibits discrimination because of participation in schools or places of worship associated with a particular racial, ethnic, or religious group.
What are other types of Discriminatory Practices prohibited under the law?
Employers are prohibited from intentionally discriminating against employees (also known as disparate treatment) but are also barred from unintentionally discriminating (known as disparate impact). In other words, a policy that appears to be neutral on its face but that has the effect of discriminating is unlawful. For example, requiring all employees to speak English, whether speaking to customers is part of the job, or not, while it appears neutral would have the discriminatory effect of keeping certain minorities from applying for, and being given, jobs.
What are the time limits for filing cases under discrimination laws?
The answer to this question, like many of the others, varies depending on what law you are filing under and what the claims are. Many charges must be filed within 180 days of the alleged act of discrimination (or the most recent one), but some extend filing times out to 1 year. In order to advise you of the proper statute of limitations (filing deadline), you should contact our offices immediately so that we get your lawsuit filed BEFORE any impending deadlines.
In many cases, one particular set of facts can lead to charges being filed under three or four different laws and/or resulting in multiple causes of action. Facts that lead to discrimination may also result in charges of harassment, retaliation, wrongful termination, and a whistle-blower complaint!
What is sexual harassment?
Harassment is defined as the act of systematic and/or continued unwanted and annoying actions of one party or a group, including threats and demands. The purposes may vary, including racial prejudice, personal malice, an attempt to force someone to quit a job or grant sexual favors, or merely gain sadistic pleasure from making someone fearful or anxious. Such activities may be the basis for a lawsuit if due to discrimination based on race or sex or any of the other protected classes listed in FEHA. A systematic pattern of harassment by an employee against another worker may subject the employer to a lawsuit for failure to protect the worker.
What if my employer punishes me for bringing a sexual harassment claim?
Punishing an employee for reporting, complaining about or filing charges of harassment is called retaliation and it is unlawful in California and the United States. In fact, it is unlawful for an employer to retaliate against any employee who reports unlawful employment practices or who file a claim for workplace discrimination or harassment. Employees are also protected from retaliation for appearing as witnesses in another employee’s sexual harassment lawsuit.
Can men be sexually harassed? What about same-sex harassment?
Harassment can be from a man to a woman, a woman to a man or same sex. Having said that, there are certain things a victim of same-sex harassment must show that a victim of opposite-sex harassment does not need to show, i.e. that the harassment was specifically because of the victim’s sex (not just sexual desire) and that he or she was treated differently than employees of the opposite sex.
What about asking a co-worker on a date? Or saying they look nice? Is that sexual harassment?
In these cases, it is better to be safe than sorry, but taking things to the extreme is not necessary. Asking a co-worker on a date is not sexual harassment unless it is accompanied by additional behaviors. Asking a co-worker on a date three times a day for a month is not only insane, it is harassment. Asking once, being rejected and then stopping, is not. Telling a co-worker he or she looks nice is not sexual harassment. Telling them they look nice after following them home from work and saying they need to sleep with you to avoid getting fired, is sexual harassment (and creepy). Be wise…ask, and if they say no, don’t ask again. Say he or she looks nice and leave it at that…and just be polite.
Is it sexual harassment even if I’ve already dated a co-worker, but then stop and they keep harassing me after we’ve broken up?
Sexual harassment occurs when the victim is subject to ‘unwelcome conduct.’ Conduct that was once okay can become unwelcome at any point. Once you say “Stop it” the conduct is clearly unwelcome. If this is the case, make it clear that you no longer wish to pursue a relationship with the co-worker and that any further advances are not acceptable. The simple fact that you had a prior relationship does not give your co-worker the right to create a situation that makes you feel uncomfortable. If he or she continues it is possible that he or she will create a work environment that is hostile because the unwelcome contact is so severe or pervasive that it begins to affect your work. At that point, it has become unlawful.
Are comments about my clothes, how I dress, or about my appearance considered sexual harassment?
As mentioned above, simple compliments are generally not considered sexual harassment. The answer to this question does depend, however, on the circumstances surrounding the comment or comments. If you have been called into the office and told to dress more appropriately, that is probably not sexual harassment, unless ‘more appropriately’ means more revealing or if it is suggested that you should ‘dress like a man’ or ‘dress like a woman.’ Asking employees to dress in sexier attire in order to impress a client could be considered sexual harassment. But a simple comment like “That is a nice suit,” is not. Of course, if that comment was followed by “it really shows off your breasts,” it becomes inappropriate could easily be seen as adding to the sexual nature of a work environment, making it hostile or abusive.
I was up for a promotion at work, and even though I was more qualified than she is, my supervisor gave the promotion to his girlfriend. Is that sexual harassment?
Not without additional facts. This is what’s called nepotism, which is defined as ‘the practice among those with power or influence of favoring relatives or friends, esp. by giving them jobs.’ Nepotism is not unlawful, even though it may not be good for business. Some employers have specific provisions in their employee handbooks saying that nepotism will not be tolerated in the workplace, which may mean that your supervisor could be disciplined, but this does not mean that you can file a lawsuit for sexual harassment. Of course, if your supervisor has created a situation in which you must ‘become his girlfriend’ in order to get a promotion or any other benefit this is clearly sexual harassment.
Is downloading porn in the workplace considered sexual harassment? What if my co-worker shares it with other co-workers?
Possibly. If your co-worker downloads porn and it is visible to you or others, if he talks about it or comments on it and it bothers you, or if he continues to download porn after you have told him you find it offensive, then it could be considered sexual harassment. The simple fact that porn exists in the workplace, without more, however does not arise to the level of conduct that creates a hostile work environment. Behavior, like downloading porn does not have to be directed at you in order to be considered hostile, but it does have to affect you and be unwelcome.
My co-worker told a joke with some sexual content in a meeting the other day. Even though I wasn’t offended and we both laughed at it, we got a memo from our supervisor saying that telling the joke was inappropriate and could be considered sexual harassment. Is telling a simple joke sexual harassment?
Again, this depends on the circumstances. Telling a joke could be considered sexual harassment if it is part of a larger environment of sexually charged comments or behavior, as this would create a hostile work environment. In your case, while YOU may not have been offended, someone else might have been, and your supervisor was correct in cautioning you that you may be violating company policies against sexual harassment. Would a ‘reasonable person’ find the joke to be offensive? In your case, someone thought the joke was offensive or they would not have reported it to your supervisor. In any event, consider the warning to be sound advice and accept the fact that not everyone considers a particular joke to be acceptable or humorous.
We have a client that continually makes sexual comments to me at work. Even though he isn’t a co-worker or supervisor, can this be considered sexual harassment?
There are definitely cases where the actions of customers or clients have led to causes of action for sexual harassment. In your case, you should be clear that the sexual advances are unwelcome and report the behavior to your supervisor or employer. Once reported, your employer has a duty to protect you from the sexual behavior by speaking with the client or simply arranging things so that you do not have to deal with him or her. Once they are put on notice that the client is engaging in inappropriate behavior and that you view it as unwelcome, their failure to insulate you could be considered harassment.
Is sexual harassment illegal, like is it a crime? Can it ever be considered a crime?
Depending on state law, harassment can be considered criminal behavior if it arises to the level of sexual assault, stalking, threats, unlawful detainer (blocking your exit or movements), criminal sexual conduct or any other crime. Sexual harassment can possibly lead to some of these other behaviors and should then be reported, not only to supervisors but also to law enforcement.
Can I be fired or terminated just for being late to work a few times?
California is an ‘at-will’ employment state. This means that an employer can fire his or her employees for no reason whatsoever. In cases where the employer gives a reason for the termination that reason must not be a ‘bad’ reason, however. This usually means that an employer can terminate its employees for any lawful reason (or again, no reason). Unlawful reasons for termination may include the violation of some law or statute, a violation of public policy or breach of a contract. As mentioned elsewhere on this site, an employer is in violation of state and federal law when it allows or actively participates in discrimination (on the basis of sex or pregnancy status, race, age, religion, disability, marital status or sexual orientation), harassment (on any of the above listed characteristics), retaliation, denial of leaves, or a refusal to violate a law or commit fraud on behalf of the employer, and the result is a termination of the victimized employee. Thus, if the employer’s true reason for terminating you was solely because you were late, and for no other reason, the termination would generally be allowed. If you are a member of a labor union, you may have other rights under your union agreement, as well.
I am in a union; can I still sue for wrongful termination?
If you are a union employee, your terms and conditions of employment are generally covered by what is called a Memorandum of Understanding (MOU) or a Collective Bargaining Agreement (CBA). The terms of this contract between your union and the employer lay out many of the terms of your employment, including how and when you can be terminated. Oftentimes, union members must go through some sort of grievance procedure as set forth in the contract before they can approach the courts for relief. If you are in a union, you should carefully review the union agreement and discuss the matter with your union rep or an attorney. If you have been terminated because of discrimination, retaliation, whistle-blowing, or as a consequence of taking a legally recognized leave of absence, you can still bring an action in court, outside of whatever is contained in your union’s agreement with your employer.
My supervisor fired me so he could give my job to his girlfriend. Is that wrong?
Wrong? Probably…I don’t know his girlfriend; maybe she was more qualified for your job. And even though it was wrong, it doesn’t mean your employer can be sued for wrongful termination. Poor business decisions are not always reasons to sue. What happened to you is referred to as nepotism. Nepotism is defined as ‘the practice among those with power or influence of favoring relatives or friends, esp. by giving them jobs.’ While it may be a bad business decision, it is generally not illegal. Unless being the supervisor’s ‘girlfriend’ is a requirement of the job and he is using his position to garner sexual favors. As mentioned previously, since California is an ‘at-will’ employment state, employers are free to hire whomever they choose for positions. If the real reason for your termination can be shown as one of the previously listed ‘bad’ reasons, however, it may still be actionable.
I have been working for my employer for more than ten years. I was suddenly let go for no reason. Is this wrongful termination?
Possibly. Because California employees are considered ‘at-will’ employees they may technically be fired at any time, for no reason. There are cases where working for an employer for a long period of time has created an ‘implied-in-fact’ contract. This means that while there is no written contract, a contract can be implied from the facts of how the parties have been dealing with each other. Implied-in-fact contracts are difficult to prove but often rely on things such as promises of continued employment, representations that you can only be fired for ‘good cause’ or comments that could lead a reasonable person to believe that they will have a place at the company until they retire. These are all facts patterns of cases that have won in court. Additionally, employees who are over 40 years of age are protected by anti-discrimination laws, if they can prove that their age was the reason for the termination.
I am one of the oldest employees at my office and I was fired. Can I sue?
Perhaps. If you are an employee over the age of 40 you are considered to be a member of a protected class, which means that discrimination against you is unlawful. If you can show that you were terminated BECAUSE of your age, you may be able to recover damages in a lawsuit. Just because you’re over 40 does not mean that you can never be fired, however. There are many factors that go into terminating an employee and most of them are legal.
My boss doesn’t like me and harasses me. Is this illegal?
Not all harassment is illegal. If harassment leads to termination and/or forcing the employee to quit, that also isn’t always illegal. Harassment based on an employee’s race, sex, age, religion, medical condition, pregnancy, disability, marital status or sexual orientation is unlawful. Harassment because he doesn’t like you, really isn’t. In fact, there have been cases where courts have ruled that some level of harassment at work, and in life, is normal and an ordinary part of most jobs.
Courts have even held that where employees have suffered emotional distress based upon harassment (that was not based upon unlawful discrimination) then the only remedy that employee can seek is through a worker’s compensation claim, as a potential on the job injury.
I was fired and my employer gave me no reason why…is this unlawful?
There are generally no requirements that an employer give its employees a reason for termination. In fact, from the employer’s point of view, it is folly to give a reason. Often the reasons given are not entirely accurate. If this is the case, further discovery may uncover the deception and point to possibly discriminatory reasons for the termination. For example, firing an employee who is over 40 and giving the reason that the employee had ‘poor attendance,’ while on its face seems legitimate, may be anyting but if it is later determined that the employee’s attendance was basically no different than that of younger employees. Now there may be a case made for age discrimination. Proving that the reason given for the termination is false may be tricky, but is a common occurrence, also known as proving that the reason was ‘pretextual’ or a ‘pretext.’
I got sick and had to take some time off. I was fired. Is that unlawful?
Employers who fire employees because they become ill and miss work are playing a dangerous game. Not to mention the fact that what they are doing isn’t very nice, it may also be unlawful. California employees are protected by the Federal law known as the Americans with Disabilities Act Amendments Act (ADAAA – I know, that’s a stupid name) and by the California laws known as the California Fair Employment and Housing Act and the California Family Rights Act (FEHA and CFRA, respectively). Employees who meet certain requirements are eligible for leaves of absence that may not be interfered with by employers. In fact, employers are prohibited from punishing employees who take protected leaves in any way and are required to return them to the same position they were in before they left. In addition, terminating an employee because of anything that may be perceived as a disability is unlawful discrimination and will itself lead to a cause of action. There are exceptions, and if you feel you have been subjected to unlawful discrimination, you should consult one of our attorneys to determine whether any of them apply to you.
So if I take a leave of absence my employer has to hold my job open?
If your leave of absence has been authorized according to one of the legally recognized leave laws and if your employer qualifies as being subject to that law, and if you meet the requirements to be a qualified employee, then yes, generally an employer must return you to the same or a similar position when you return from the leave. A ‘similar position’ is one that requires the same type of work the same level of physicality, offers the same pay and benefits and generally has the same terms and conditions of employment. One of the main laws governing leaves of absence in the United States is the Family Medical Leave Act or FMLA. In California, we have a similar law called the California Family Rights Act. They both provide for leaves of absence for serious health conditions of either the employee or the employee’s family members. Some terms and conditions apply, however, so if you feel that you may be subject to one of the laws and you feel that you have been terminated in violation of one of them, contact us and we will help you determine whether you have a cause of action.
My boss asked me out on a date and I refused to go. The next day I was fired. Is that wrongful termination?
Yes, it pretty much is, and we’d like to talk to you as soon as possible! An employer cannot base employment decisions on the granting or refusal of sexual favors, relationship offers, or anything of that nature. This is clear discrimination, harassment and wrongful. It is also clearly unlawful. If however, your boss asks you out and you’re into it, then it isn’t harassment, because it is not unwelcome on your part. That ‘unwelcome-ness’ makes all the difference.
Can I be fired if I complain about sexual harassment?
Not legally. There are state and federal laws in place to protect whistle-blowers. If you complain about illegal, unlawful or fraudulent behavior on the part of your employer, you are a whistle-blower and you are protected from retaliation. This goes way beyond just reporting sexual harassment and employees who have reported wrongdoing on the part of their employers have recovered billions of dollars in court judgments and settlements.
Is it wrong to be fired because I complained about safety?
Employees are usually protected against retaliation for complaining about violations of law, including those based upon safety. There are also numerous “public policy” rights to complain about an employer’s violation of laws or regulations, including, for example, the non-payment of wages or being required to work under unlawful conditions. There is generally no requirement that the complaint is made to a government agency, and a complaint to the employer followed by retaliation, may be unlawful.
I do have a written employment contract with my employer. Can I be terminated?
Generally, the terms and conditions of your employment are stated in the employment contract, which may provide for specific grounds for termination and should definitely outline the process that your employer needs to take in order to terminate your employment. A breach of that contract on the part of the employee may be grounds for termination, depending on the language in the agreement. Some employment “contracts” are not complete contracts, especially those not created or reviewed by one of our attorneys, but instead only provide the details of the agreement regarding compensation. An employee with an employment contract should consult with one of our attorneys regarding their rights.
My employer terminated me in violation of the employee handbook. Is it wrongful?
Generally, employers are free to change their employment policies and handbooks, or in some cases, disregard them. This is due to the “at-will” nature of employment in California. However, under in some cases, an implied contract to terminate an employee only for good cause, can sometimes be created from an employee’s reliance on the employer’s personnel policies. If, for example, an employer has an established policy that employees are permanent after completing a probationary period, the employees can only be terminated for certain rule violations, and that the employee is entitled to “progressive discipline,” then the employee handbook may create an implied contract to terminate only for good cause. However, the rules in such cases are complex and one of our attorneys should be consulted.
What are illegal reasons for terminating an employee?
Employers are prohibited from discriminating against employees in violation of federal and state employment laws. Under federal law, employers must not discriminate against employees based on race, color, religion, sex, national origin or age. They also must not discriminate against people with disabilities when those disabilities can be reasonably accommodated. California also prohibits employment discrimination based on sexual orientation, marital status or whether employees receive public aid. An employee who is terminated in violation of an employment contract also may have a legal claim against the employer.
What can I be fired for?
If you are an at-will employee, you can be fired for any reason as long as it is not illegal. You can be fired for misconduct such as excessive absences or tardiness or simply because your employer does not like your personality. If you have an employment contract, however, your contract may limit the reasons for which you can be fired.
What does ‘at-will’ employment mean?
Employment at will means that you can quit or your employer can fire you at any time with or without notice. Your employer can have any reason for the termination or no reason at all, as long as your employer does not have an illegal reason for firing you, such as racial discrimination.
What happens to my health insurance after I lose my job? Does it continue? Do I have to pay for it?
The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives certain workers the right to continue their group health benefits for themselves and their families for a limited time after a job ends. Qualified individuals will generally pay the entire premium for health insurance coverage.
How do I know if I’m entitled to receive unemployment compensation?
If you are laid off and have a sufficient employment history, you will be entitled to unemployment compensation. If you are fired for a reason other than misconduct, you are also likely to be entitled to unemployment compensation. Generally, if an employee leaves employment voluntarily, the employee will not qualify for unemployment compensation. If an employee leaves as a result of an issue like sexual harassment or unsafe working conditions, however, unemployment compensation may be granted.
When I got my job they made me sign a non-compete agreement. Now, after I’ve left my job they are trying to tell me I can’t open my own business. Is that non-compete agreement enforceable!
Non-compete clauses, also known as covenants not to compete can be enforceable depending on state law. In California, a non-compete clause can be enforceable if it was signed prior to employment beginning, and if it supported by valuable consideration. Valuable consideration basically means that you got something of value in exchange for your agreement not to compete. The agreement also needs to be reasonable in scope (what things you are not allowed to do and where) and duration (time). It is possible that if you signed the agreement before starting to work, the fact that they gave you the job could be considered valuable consideration. As far as scope and duration, the actual facts of the situation will govern whether or not the agreement is reasonable. If you have a job selling widgets for WidgetCo., it would not be reasonable for the non-compete clause to limit you from selling cars for 5 years after leaving. The scope and duration of the non-compete agreement are reasonable if the limits on the employee’s right to work are no greater than necessary to protect the employer’s legitimate business interests.
I don’t have an employment contract, but my boss has told me several times that as long as I perform well I have a job here. Can I be fired if I am performing well?
You may actually have an employment contract, even though nothing has been written down. California is one of the states that recognize the ‘implied-in-fact’ employment contract. If your employer has made representations that your employment will continue as long as you do a good job, courts have found that even though there is no written agreement to that effect, the fact that he or she made that representation to you IMPLIES that there is a contract. That implied contact could possibly be enforced.
I thought I was supposed to get a severance package if I’m fired…I didn’t get one. Can I sue?
Unless your employment is governed by an employment contract that requires your employer to pay you a severance package should you be terminated, or unless your employee handbook outlines a severance package that applies to your situation, there are no State or federal laws that require your employer to give you one. If you are in the process of negotiating an employment contract, or already have one, contact one of our attorneys so that we can make sure you are protected and/or that your employer complies with any contractual provisions already in place.
If I think I may have a case for wrongful termination, what should I do? Should I take copies of documents from work before I leave, or ask friends to get copies for me?
Honestly, the first thing you should do is contact Stephen and set up a free consultation. We will sit down with you to discuss the facts of your case to determine whether you have a potential cause of action. Once that is decided, we will also help you lay out a plan for gathering information. YOU DO NOT want to just go in and take documents from your employers or former employer!! There have been too many cases where stolen documents have been kept out of court or out of evidence because they were stolen and were then ruled inadmissible. Stephen can discuss with you proper means of evidence collection so that you do not jeopardize your case.
What is workplace retaliation and is it illegal?
Workplace retaliation is unlawful if the employee is engaged in protected conduct. If so, employers are prohibited from ‘getting back at’ employees who have done something that is protected by law. Retaliation is a separate cause of action that allows an employee to sue his or her employer for reinstatement (if the employee has been fired), for back pay and/or other relief when:
· an employee engages in protected conduct;
· the employer takes a “material, adverse action” against him or her; and
· the adverse action is causally related to the protected conduct.
Laws against retaliation have been specifically designed to protect employees from employers who fire back in anger and wish to take it out on the reporting employee.
You mentioned ‘protected workplace conduct;’ what is that?
There are hundreds of laws that create protected workplace conduct. Many of them contain their own language about retaliation. In other parts of this website we have discussed laws against workplace discrimination, leave and benefit laws (like FMLA or CFRA), wage and hour laws, etc. Each of these laws has specific provisions that prohibit workplace retaliation and protect employees who assert those rights. Anti-retaliation provisions generally outline the types of conduct they prohibit. For instance, employees clearly have the right, in the United States to form a union, or to gather in order to discuss the formation of a union. Naturally, most employers are opposed to the idea. Therefore, laws that create a right to form a union, also protect those employees who are trying to do so.
Can you give me some examples of things that might be considered ‘protected conduct?’
The Family Medical Leave Act and the California Family Rights Act allow employees to take legally protected leaves of absence for the serious health condition of the employee or a member of the employees immediate family (with some exceptions). If an employee takes advantage of these legally protected leaves of absence, the FMLA, and the CFRA specifically protect that employee from any type of retaliatory conduct on the part of the employer.
Employees who object to, or report acts of discrimination, either against themselves or other employees, are engaged in protected conduct and cannot be retaliated against.
If an employee reports an incident of sexual harassment, either as the victim or a witness, he or she is engaged in protected conduct. You are also protected if you participate in the investigation of discrimination or harassment.
I filed charges of harassment against my employer and lost. Can they retaliate against me now because the court said I didn’t have a claim?
They cannot. You are protected from retaliation even if your case gets dismissed or it turns out that your rights were not violated. As long as you had a good faith belief that your rights were being violated, you are protected, no matter what the outcome of your case. The point of these laws is to encourage employees to report unlawful behavior. Allowing employers to retaliate, even if they turn out to be wrong, would deter employees from reporting in the first place. For example, an employee who believes that he has witnessed his supervisor sexually harass a co-worker and reports what he has witnessed is protected from retaliation, even if it turns out later that the acts were consensual. Likewise, an employee who files a claim with the Department of Labor’s Wage and Hour Division, claiming she has not been paid the proper amount of overtime, is similarly protected, even if it turns out that she has been paid appropriately.
If I report an act of discrimination, or do something else that is protected, does that mean that my employer can’t fire me?
You can’t be fired for reporting. This does not give you carte blanche to stop showing up for work or otherwise not doing your job properly. You can still be disciplined for other behavior. While your employer cannot fire you for making the report or engaging in the protected conduct, they can terminate you for any other legitimate, lawful reason. You are also not protected if you make a groundless or bad faith complaint or harassment or discrimination. There are cases of employees getting wind of the fact that they may be fired or terminated and then filing a baseless claim of discrimination in order to try to protect their jobs. The law in these cases will not treat the complaint as protected conduct.
I was part of a group at my office that was trying to form a union. My supervisor then gave me a bad performance review. Can I sue for retaliation?
Not just yet. A negative performance review, while something to complain about, is not considered a ‘tangible, adverse employment action.’ In other words, in order to consider yourself ‘retaliated against’ you must have suffered some form of tangible harm…in most cases, this means a monetary loss…in order to file a complaint. A negative performance review doesn’t necessarily result in a monetary loss unless it is part of a series of harassing events, and/or is used as part of a future campaign to terminate you. At that point, you can sue and you should call us so we can help you win.
What do you mean when you say the retaliation has to be tangible?
The tangibility of an act of retaliation was recently defined by the US Supreme Court (keep in mind, this ruling does not necessarily reflect the views of California state courts) in the case of Burlington Northern & Santa Fe Ry. v. White, 126 S. Ct. 2405 (U.S. 2006). In that case the Supreme Court defined a tangible, adverse action as one that:
“would have been materially adverse to a reasonable employee or applicant. . . . [A] retaliation plaintiff (must) show that the challenged action well might have dissuaded a reasonable worker from making or supporting a charge of discrimination.”
In Burlington the company suspended an employee for 37 days without pay after she made a complaint but then reversed course and paid the employee for her lost wages. The question before the court was whether the adverse action (the suspension) was “tangible” because the employee ended up not losing money. The Court said that it was since, based on the test quoted above, a reasonable person would not make the complaint in the first place knowing that she would go 37 days without pay or an assurance of being paid.
Other examples of tangible retaliatory acts may include transfer to an undesirable location or position, demotion, loss of pay raise or overtime, loss in responsibility, transfer to an undesirable shift or given undesirable hours, especially if any of those things would deter a reasonable employee from making the claim of discrimination, harassment, or engaging in the protected behavior.
If my employer gives me a poor reference for a new job, is that retaliation?
It can be. Unless it’s the truth. Negatively reporting on a person’s previous performance when that negativity isn’t warranted, and possibly causing loss of future employment is definitely a tangible action. Protection from retaliation can follow a person even after he or she has left the job. Courts have allowed recovery for negative references.
Employees have also been known to instigate unjustified criminal or government investigations (perhaps into an ex-employee’s professional license) in acts of retaliation. Those cases have been upheld and resulted in damages, as well. Courts have also looked unfavorably on employers filing counter-claims designed to intimidate the employee filing the lawsuit, where those counter-claims have been unwarranted and designed to intimidate the employee into withdrawing the complaint or not filing it.
What kinds of things do I need to prove in order to prove a retaliation case?
Generally, you must prove;
· that you engaged in some sort of protected conduct;
· that you suffered a tangible, adverse employment action; and
· that there is a causal connection between your protected conduct and the adverse action.
Proving causation is usually the most difficult part of a retaliation claim. You can prove causation by showing:
· the close timing between the protected conduct and the adverse action;
· the lack of an investigation into your complaint,
· unequal treatment of you compared to non-complaining employees;
· a pattern of adverse actions or hostility towards other complaining employees; or
· a bogus explanation for your employer’s adverse action.
Timing? Is it important that the adverse action be close in time to my protected actions?
The timing between a protected act and an adverse action is probably one of the more important pieces of evidence in your case. It tends to help show that your employer was angry about your actions and lashed out in an unlawful manner. In those cases, courts tend to believe it more when the employer acts quickly. Whether true or not, courts have gone so far as to dismiss cases where the adverse action took place months after the protected activity. Of course, there are cases where employers have waited patiently to retaliate, sometimes simply giving an unwarranted reprimand early on. While that reprimand isn’t enough to support a claim, it can be used to bolster a termination later on down the road.
I reported some discrimination at my workplace and now I’m being harassed. Can harassment support a claim of retaliation?
Of course. Harassment is a classic example of retaliatory behavior. Even without economic loss, it is pretty obvious what is happening, and since harassment often negatively affects an employee’s job performance it is definitely actionable, especially if it causes such anxiety that the employee feels the need to quit his or her job.
You mentioned unequal treatment. What types of unequal treatment can support a claim for retaliation?
Evidence of unequal treatment in a retaliation case is much the same as it is in any type of discrimination case. Disparate treatment in a case of age, sex, race and any other type of discrimination claim is satisfactory. Any act that can be seen as treating the victim employee differently from, and worse than, similarly situated employees who did not engage in protected activity, is sufficient to support a claim.
You mentioned a bogus employer explanation for an adverse action can sometimes help prove retaliation. How does that work?
There are many areas of the law where an explanation for certain behavior is seen as bogus. This is known as a pretext. If you can prove that the employer’s given reason for firing you is pretextual, most courts, juries included, will see that as evidence that your employer is retaliating against you, and that the real reason for your discharge is unlawful. We love proving that an employer has lied about the reason for firing you. It often leads to a great recovery!
If my employer fails to investigate my claim, how can that be evidence of retaliation?
Employers should investigate employee claims of harassment, discrimination or other wrongdoing in every case. In cases where they do not take your complaints seriously, it can often also be inferred that they resent the fact that you filed the complaint in the first place.
Employers should, at the very least:
· Interviews with the complainant, witnesses and the accused employee (where appropriate);
· Arrive at reasonable conclusions about the validity of the complaint; and
· A response consistent with that conclusion.
If these simple steps aren’t taken, then a jury can reasonably conclude that the employer not only refused to take the complaint seriously, but also acted in a manner consistent with retaliating against the employee for complaining in the first place.
What should I do if I am a victim of retaliation?
You should contact our offices before you take any further steps. If you are contemplating blowing the whistle on your employer, or reporting an act of discrimination or any other unlawful behavior, or if you are worried about retaliation subsequent taking a leave of absence, give us a call to schedule a free consultation in order to discuss your concerns. We often advise employees in your position on how to proceed in order to maximize the possibility of recovery. Be aware that deadlines for filing complaints in these cases can be quite short in some cases. Do not jeopardize your case by allowing time limits to expire.
If I choose not to file a lawsuit, even though my supervisor is retaliating against me…harassing me or worse…what other actions can I take to protect myself?
1. Do not give your supervisor any reason to take additional action against you. Attempt to be polite and professional whenever dealing with the retaliating supervisor. Do not lash out, or give your supervisor any other excuse to discipline you.
2. Keep a log of everything that happens that could be considered evidence. Record times and dates of behaviors, as memories, often fade or become distorted, especially in situations that result in anxiety like those involved with retaliation. Keep copies of documents you feel might be useful. BUT DO NOT TAKE ORIGINALS. These are often the property of your employer and if you ‘steal’ them they may end up being inadmissible.
3. If you are reprimanded, reply to the reprimand politely. Do not argue, but keep track of conversations and whatever documentation available. You should try to stand your ground without being disrespectful. Respond as if you are willing to address the unwarranted concerns and correct deficiencies.
4. Contact our offices so that we can help you determine an effective course of action. We are experts in guiding employees in these types of situations.
5. You may want to begin looking for another job. If that is possible, then that is probably your best course of action. If you cannot quit your job, or find another one at this time, maintain your composure and allow time for the retaliation to stop or reach a level where you will have to file a lawsuit in order to stop it.
Wage and Hour
My Uncle owns a business and he lets me work there a few hours a week in order to make some extra money. I’m only 15. Am I an employee? Does he have to pay me minimum wage?
Yes, you are an employee. Under the California labor law an employee is defined as someone engaged or permitted to work. Even though you are a part of your uncle’s family, you are considered an employee and he, as the employer, must provide Workers’ Compensation Insurance to cover you in case of a work-related injury. In addition, he is also required to pay the minimum wage unless the employee is a spouse, parent or child and he is a sole proprietor or partnership. Corporations do not have children and therefore, no family relationship to the officers of the corporation can be exempt from these requirements.
What is the current minimum wage in California?
The current minimum wage in California is $8.00 an hour. Although there are some exceptions, almost all employees in California must be paid the minimum wage as required by state law. Effective July 1, 2014, the minimum wage in California is $9.00 per hour. Effective January 1, 2016, the minimum wage in California is $10.00 per hour. There are some employees who are exempt from the minimum wage law, such as outside salespersons, individuals who are the parent, spouse, or child of the employer, and apprentices regularly indentured under the State Division of Apprenticeship Standards.
There is an exception for learners, regardless of age, who may be paid not less than 85% of the minimum wage rounded to the nearest nickel during their first 160 hours of employment in occupations in which they have no previous similar or related experience. There are also exceptions for employees who are mentally or physically disabled, or both, and for nonprofit organizations such as sheltered workshops or rehabilitation facilities that employ disabled workers. Such individuals and organizations may be issued a special license by the Division of Labor Standards Enforcement authorizing employment at a wage less than the legal minimum wage.
I am 15 and my dad owns a store where I want to work. Do I need a work permit and does it matter how many hours a week that I work?
Work permits for minors are required under California law, even if the employee is a family member. Work permits can usually be obtained at the minor’s school and the permit should indicate how many hours a week the minor is permitted to work. While school is in session minors are only allowed to work during off hours. It is impermissible for an employer to require a minor to miss school in favor of work. Generally, a minor 15 years of age is allowed to work 3 hours a day on school days, and 8 hours a day on non-school days. A 15 year old is not allowed to work more than 18 hours per week, unless he or she is on break from school, in which case an employee is allowed to work a maximum of 8 hours a day and 40 hours per week. You should also be aware that minors may not be employed in any business, exhibition or vocation that would be hazardous or dangerous to the health or welfare of the minor.
My employer hired me as an independent contractor. What does that mean?
Not all workers are employees as they may be volunteers or independent contractors. Employers oftentimes improperly classify their employees as independent contractors so that they, the employer, do not have to pay payroll taxes, the minimum wage or overtime, comply with other wage and hour law requirements such as providing meal periods and rest breaks, or reimburse their workers for business expenses incurred in performing their jobs. Additionally, employers do not have to cover independent contractors under workers’ compensation insurance, and are not liable for payments under unemployment insurance, disability insurance, or social security.
The state agencies most involved with the determination of independent contractor status are the Employment Development Department (EDD), which is concerned with employment-related taxes, and the Division of Labor Standards Enforcement (DLSE), which is concerned with whether the wage, hour and workers’ compensation insurance laws apply. There are other agencies, such as the Franchise Tax Board (FTB), Division of Workers’ Compensation (DWC), and the Contractors State Licensing Board (CSLB), that also have regulations or requirements concerning independent contractors. Since different laws may be involved in a particular situation such as a termination of employment, it is possible that the same individual may be considered an employee for purposes of one law and an independent contractor under another law. Because the potential liabilities and penalties are significant if an individual is treated as an independent contractor and later found to be an employee, each working relationship should be thoroughly researched and analyzed before it is established.
If your job requires a license, or if the services you perform require you to obtain a license, or if you are doing work for a person who must have a license, it is presumed that you are an employee and not an independent contractor.
How do I know if I am an employee or an independent contractor?
This is an important employment law question, as it often leads to a determination that an employer has misclassified employees as independent contractors in order to avoid paying one or more taxes. As such it is fertile ground for whistle-blower complaints and potential monetary recovery by employees who alert authorities to the misclassification and aid in the investigation.
This is one of the trickier areas of employment law, and this question is a difficult one to answer here, as it depends on so many variables and relies on the interpretations of various courts and government agencies. If, after reading this outline, you still have questions, contact our offices for a free consultation and we will look at the facts of your individual case to help determine your classification. In determining whether a person hired is an independent contractor or an employee, the Division of Labor Standards Enforcement (DLSE) starts with the presumption that the worker is an employee. This is a presumption that be overcome however, and the actual determination of whether a worker is an employee or independent contractor depends upon a number of factors, all of which must be considered, and none of which is controlling by itself. Because of this the facts of each case must be examined individually and the law applied on a case-by-case basis. This usually means applying the ‘multi-factor’ test or the ‘economic realities’ test created by the California Supreme Court when it decided the case of S. G. Borello & Sons, Inc. v Dept. of Industrial Relations (1989) 48 Cal.3d 341.
When analyzing the facts under the economic realities test, the most important factor to be considered is whether the employer “has control or the right to control the worker both as to the work done and the manner and means in which it is performed.”
Additional factors that may be considered depending on the issue involved are:
1. Is the employee in the same business as the employer?
2. Is the work a part of the regular business of the employer?
3. Does the employer supply the tools and the place for the employee to do the work?
4. Does the employee have to buy his or her own equipment, or hire his or her own helpers, in order to do the work?
5. Does the service require a special skill?
6. Is the work in this industry and in this locality (California) usually performed without supervision?
7. Does the employee make more or less profit depending on his managerial skills?
8. How long will it take for the services to be performed?
9. Is the working relationship permanent?
10. Is the employee paid by time or by the job? And
11. Do the parties believe they are creating an employee/employer relationship or a principal/independent contractor relationship? This questions may have some bearing on the result, but is not determinative since this is a question of law based on objective tests.
“Even where there is an absence of control over work details, an employer-employee relationship will be found if (1) the principal retains pervasive control over the operation as a whole, (2) the worker’s duties are an integral part of the operation, and (3) the nature of the work makes detailed control unnecessary.” (Yellow Cab Cooperative v. Workers Compensation Appeals Board (1991) 226 Cal.App.3d 1288)
Other points to remember in determining whether a worker is an employee or independent contractor are that the existence of a written agreement purporting to establish an independent contractor relationship is not determinative (Borello, Id.at 349) , and the fact that a worker is issued a 1099 form rather than a W-2 form is also not determinative with respect to independent contractor status. (Toyota Motor Sales v. Superior Court (1990) 220 Cal.App.3d 864, 877)
My boss says that I’m an independent contractor and not an employee. He doesn’t make any payroll deductions or withholdings for taxes, social security, etc., when he pays me, and at the end of the year he provides me with an IRS form 1099 rather than a W-2. Does this mean I’m automatically an independent contractor?
No. An employer cannot change the status of an employee to an independent contractor just by illegally requiring you to pay your own withholding taxes, as the law places this burden squarely on the employer’s shoulders. In addition, providing someone with a 1099 form rather than a W-2 has little significance in determining whether you are an employee or an independent contractor.
What difference does it make if my employer has misclassified me?
It makes a huge difference. California’s wage and hour laws (e.g., minimum wage, overtime, meal periods and rest breaks, etc.), and anti-discrimination and retaliation laws protect employees, but not independent contractors. Additionally, employees can go to state agencies such as DLSE to seek enforcement of the law, whereas independent contractors must go to court to settle their disputes or enforce other rights under their contracts.
When I started my job my employer had me sign an agreement stating that I am an independent contractor and not an employee. Does this mean I am an independent contractor?
No. A written agreement between the parties does not determine whether a person is an employee or independent contractor. The courts and other agencies will look at the facts of the working relationship, and apply the prevailing law, to determine your status.
I figured my employer misclassified me in order to save himself some money, so I asked STEPHEN DANZ, the most prominent and skilled employment attorney in the world, to file a wage claim with the Labor Commissioner for me. We won! They determined I was an employee. Later I filed a claim with the Employment Development Department (EDD) in order to make a claim for unemployment insurance benefits and they said I was an independent contractor. How can this be?
Different agencies use different tests to determine a worker’s status. While the DLSE may use a five prong multi-factor, economic realities test, another agency may be required to use the ‘control test.’ This often leads agencies to reach different conclusions. This is one of the reasons this area of the law is so tricky and why you should schedule a FREE CONSULTATION with STEPHEN DANZ in order to determine your actual status, especially if you have co-workers in the same boat, as this may lead to a class action and result in a large monetary recovery on your behalf. It is possible that the same individual will be considered an employee for purposes of one law and an independent contractor under another.
As an employer, what obligations do I have to purchase Workers’ Compensation Insurance or comply with other labor laws for persons classified as independent contractors?
We do not represent employers. We have dedicated our practice to defending the employees of the state of California and around the globe from the unlawful and illegal actions of employers. Therefore we do not provide employers with legal advice. If you are an employee who has been misclassified by your employer so that he or she could dump the tax burdens on your shoulders rather than paying them himself or herself, however, here are some of the things they are responsible for: Employers often improperly classify their employees as independent contractors to avoid paying payroll taxes, minimum wage or overtime, or complying with other wage and hour requirements such as providing meal periods and rest breaks, etc. Additionally, employers do not have to cover independent contractors under Workers’ Compensation Insurance. However, because potential liabilities and penalties are significant it is important that each working relationship be thoroughly researched and analyzed before classifying an individual as an independent contractor and not an employee. You should understand that the DLSE presumes that the worker is an employee. However, the actual determination of whether a worker is an employee or independent contractor depends upon a number of factors which must be considered. Consequently, it is necessary to closely examine the facts of each relationship and then apply the law to those facts. The most significant factor to be considered is whether the person to whom service is rendered (the employer or principal) has control or the right to control the worker, the work to be done and the manner and means in which it is performed.
So what if my employer has misclassified me and refuses to pay me overtime or pay any of the taxes or provide benefits that would normally be required if I was properly classified as an employee? What can I do?
Contact our offices immediately! Schedule a FREE CONSULATATION with Stephen so that we can discuss the facts of your case. You may also want to review the “WHISTLEBLOWER FAQ” page of our website. Whistleblowers are often allowed to take a percentage of the penalties and judgments obtained by investigating government agencies, which can lead to huge potential recoveries, especially when multiple employees are concerned and potential punitive damages are awarded. We can file an action in court to recover the lost overtime premiums and other benefits and alert the IRS and other government agencies about your employer’s illegal behavior. In both situations, it will first be necessary to determine your employment status, that is, employee or independent contractor, before the issue of overtime can be addressed and decided. Additionally, if it is determined that you are an employee and you no longer work for this employer, we can make a claim for the waiting time penalty pursuant to Labor Code Section 203. Eligibility for this penalty is dependent upon your employment status, as independent contractors are ineligible for the waiting time penalty.
What can I do if I prevail at the hearing or in court and the employer doesn’t pay or appeal the Order, Decision, or Award?
When the DLSE issues an Order, Decision, or Award (ODA) in the employee’s favor and there is no appeal, and the employer does not pay the ODA, the Division of Labor Standards Enforcement (DLSE) will have the court enter the ODA as a judgment against the employer. This judgment has the same force and effect as any other money judgment entered by the court. Consequently, you may either try to collect the judgment yourself or you can assign it to DLSE.
What if my employer gets mad at me and retaliates against me because I reported that I had been misclassified?
You should let us know immediately, as this is illegal behavior on the part of your employer. If your employer retaliates against you for reporting him or her and for participating in the investigation of misclassification, you are protected by various whistleblower laws and will have a cause of action for the unlawful retaliation. If you are an employee and your employer discriminates or retaliates against you in any manner whatsoever, for example, he discharges you because you question him about your employment status, or about not being paid overtime, or because you file a claim or threaten to file a claim with the Labor Commissioner, you can file a discrimination/retaliation complaint. In the alternative, you can file an action in court against your employer.
Last week I worked eight hours on the 4th of July holiday, which fell on Wednesday. For the whole week I worked 40 hours. When I got my paycheck this week I was paid for 40 hours at my straight time rate. Aren’t I entitled to extra pay, of at least double time, for working on a holiday?
There is nothing in state law that mandates an employer pay an employee a special premium for work performed on holidays, Saturdays, or Sundays, other than the overtime premium required for work in excess of eight hours in a workday or 40 hours in a workweek. Unless your employer has a policy or practice of paying a premium rate for working on a holiday, or you are subject to a collective bargaining or employment agreement that contains such a term, your employer is only required to pay you your regular rate of pay for all the straight time hours worked on the holiday, and the overtime premium required for work in excess of eight hours in a workday or 40 hours in a workweek. Since you did not work over eight hours on the holiday, or more than 40 hours during the workweek, you were paid correctly.
My employer is open for business on every holiday, some of which I have to work. Isn’t this against the law?
No. There is nothing in state law that mandates that an employer must close its business on any particular day, if at all. It is up to your employer to select which days, if any, it chooses to be open and closed for business, and if your employer is open on a holiday and schedules you to work that day, there is nothing in the law that obligates your employer to pay you anything but your regular pay and any overtime premium for all overtime hours worked.
Last week we were closed for business on Monday to celebrate Memorial Day. Consequently, I worked Tuesday through Saturday that week, eight hours each day. When I got my paycheck this week I was paid for 48 hours last week at my straight time rate. Shouldn’t eight of those hours be paid at time and one-half, the overtime rate, since I was paid for more than 40 hours in the workweek?
No, you were paid correctly. In this situation, even though you did not work on the holiday your employer chose to pay you for it, which it has the absolute right and discretion to do. However, the determination of whether overtime pay is due is based upon hours worked, more than eight in a workday or more than 40 in a workweek, and not upon pay received. Thus, since you did not work more than eight hours in any one workday, or more than 40 hours in the workweek, you are not entitled to any overtime pay for the workweek.
We get 11 holidays off each year without pay. My sister gets the same 11 holidays off, and she gets paid for all of them. Is my employer breaking the law because he’s not paying us for these holidays when he’s required to, even though we don’t work on any of them?
No, your employer is not breaking the law. There is nothing in state law that mandates that employees be paid for holidays that are not worked.
Is my employer required to give us meal periods while we work? What exactly is required in California?
California law requires that employees must be provided with no less than a thirty-minute meal period when the work period is more than five hours (more than six hours for employees in the motion picture industry).Unless the employee is relieved of all duty during the entire thirty-minute meal period and is free to leave the employer’s premises, the meal period shall be considered “on duty,” counted as hours worked, and paid for at the employee’s regular rate of pay. An “on duty” meal period will be permitted only when the nature of the work prevents the employee from being relieved of all duty and when by written agreement between the employer and employee an on-the-job meal period is agreed to. The test of whether the nature of the work prevents an employee from being relieved of all duty is an objective one. An employer and employee may not agree to an on-duty meal period unless, based on objective criteria, any employee would be prevented from being relieved of all duty based on the necessary job duties. Some examples of jobs that fit this category are a sole worker in a coffee kiosk, a sole worker in an all-night convenience store, and a security guard stationed alone at a remote site.
How does an employer satisfy its obligation to provide a meal period according to the law?
While there are some limited exceptions (i.e. for those in healthcare), in general an employer must do more than simply make a meal period “available.” While the employer does not need to police employees to make sure they are not doing any work, an employer must actually relieve employees of all duty, relinquish control over their activities, permit them a reasonable opportunity to take an uninterrupted 30-minute break (in which they are free to come and go as they please), and must not impede or discourage employees from taking their meal period. Employers may not use other methods to ensure that employees do not take their breaks (by scheduling them at times that make taking the break extremely difficult), they may not offer incentives for skipping the meal periods, and they may not coerce employees into giving up a legally protected meal break. Though, the actual standards that must be met and actual behavior that will or will not be tolerated often varies from industry to industry.
Are there any timing requirements that my boss has to follow when scheduling my meal breaks? What are those requirements for first meal and second meal breaks?
In general, when an employee works for a work period of more than five hours, a meal period must be provided no later than the end of the employee’s fifth hour of work (in other words, no later than the start of the employee’s sixth hour of work). When an employee works for a period of more than 10 hours, a second meal period must be provided no later than the end of the employee’s tenth hour of work (in other words, no later than the start of the employee’s eleventh hour of work). The foregoing rules are subject to certain waivers by mutual consent (as explained above), and different rules apply to employees in the motion picture industry.
My employer is not allowing me to take a meal period. Is there anything I can do about this situation?
Yes, there is something you can do if you are covered by the meal period requirements of the law. If your employer fails to provide the required meal period, you are to be paid one hour of pay at your regular rate of compensation (this is referred to as meal period premium pay) for each workday that the meal period is not provided. If your employer fails to pay the additional one-hour’s pay, you may file a wage claim with the Division of Labor Standards Enforcement.
If my employer says I don’t have to work during my meal period and he gives up all control over me during those meal breaks, but I decide to work anyway, is my employer liable for meal period premium pay?
Nice try….your employer would not be liable for meal period premium pay where he actually relieves you of all duty and gives up control of you, and there is no coercion or attempts to discourage you from taking the meal break. However, if your boss knows that you are working during your meal breaks or has reason to know, then he or she is liable to pay your for the time worked, including any overtime hours that result.
Can I choose to work through my meal period so that I can leave my job 30 minutes early?
No, working through your meal period does not entitle you to leave work early prior to your scheduled quitting time. In order for an “on duty” meal period to be permitted under the Industrial Welfare Commission Wage Orders, the nature of the work must actually prevent the employee from being relieved of all duty, and there must be a written agreement that an on-the-job paid meal period is agreed to. Additionally, the written agreement must also state that the employee may, in writing, revoke the agreement at any time.
Can my boss make me stay on premises during my meal breaks?
Yes, your employer can require that you remain on its premises during your meal period, even if you are relieved of all work duties. However if that occurs, you are being denied your time for your own purposes, and in effect remain under the employer’s control and thus, the meal period must be paid. Minor exceptions to this general rule exist regarding healthcare workers. Pursuant to the Industrial Welfare Commission Wage Orders, if you are required to eat on the premises, a suitable place for that purpose must be designated. “Suitable” means a sheltered place with facilities available for securing hot food and drink or for heating food or drink, and for consuming such food and drink.
I regularly work an eight-hour shift. What can I do if my employer doesn’t provide me with a meal period?
You can contact us and we will pursue the matter for you, especially if you are not the only employee being subjected to this unlawful treatment. We can file a lawsuit on your behalf to recover the lost pay that would have been due had your employer followed the law.
How long do I have to file a meal period claim?
In the case of Murphy v. Cole, the California Supreme Court held that the remedy for meal and rest period violations of “one additional hour of pay” under Labor Code section 226.7 is a wage subject to a three-year statute of limitations. Accordingly, a claim must be filed within three (3) years of the alleged meal period violation.
What if my boss threatens to fire me because I complained about not getting a meal period?
This is unlawful retaliation and you should contact our offices. If your employer discriminates or retaliates against you in any manner whatsoever, for example, he discharges you because you ask about not getting a meal period, object to what you believe to be an illegal practice, or because you file a claim or threaten to file a claim with the Labor Commissioner, we can file a discrimination/retaliation complaint against your employer.
What is the regular rate of pay in California and how is it calculated?
In order to determine your overtime rate of pay, you must first determine your regular rate of pay. Your regular rate of pay is the amount of compensation you normally receive for the work you do. Your regular rate of pay may be hourly, salary, commission, piecework earnings or any other type of remuneration, but in no event may your rate of pay be less than the minimum wage.
For every employee in California, there is a maximum to the number of REGULAR hours they may legally be allowed to work. Anything above that limit is considered overtime. Normally the maximum regular hours that may be worked is 8 hours a day or 40 hours per week. They are not the same, however, as the number of days a person works per week may vary. For example, there are some employees who work 4 days a week and therefore their maximum regular hours cannot be 8 hours a day, but instead is 40 hours per week. It is important to determine what maximum is legal in each case. The alternate method of scheduling and computing overtime under most Industrial Welfare Commission Wage Orders, based on an alternative workweek schedule of four 10-hour days or three 12-hour days does not affect the regular rate of pay, which in this case also would be computed on the basis of 40 hours per workweek.
The agreed upon regular hours must be used if they are less than the legal maximum regular hours. For example, if you work 32 to 38 hours each week, there is an agreed workweek of 35 hours, and thirty-five hours is the figure used to determine the regular rate of pay. However, in circumstances where the workweek is less than 40 hours, the law does not require payment of the overtime premium unless the employee works more than eight hours in a workday or more than 40 hours in a workweek. In other words, assuming you are employed under a policy that provides for a 35-hour workweek, the law does not require the employer to pay the overtime premium until after 40 hours in a workweek. If you work more than 35 but fewer than 40 hours in a workweek, you will be entitled to be paid for the extra hours at your regular rate of pay, as overtime premium pay is only required after 40 hours in a workweek.
The following are examples of how to calculate the regular rate of pay:
1. If you are paid on an hourly basis, that amount is the regular rate of pay.
2. If you are paid a salary, the regular rate is determined as follows:
1. Multiply the monthly remuneration by 12 (months) to get the annual salary.
2. Divide the annual salary by 52 (weeks) to get the weekly salary.
3. Divide the weekly salary by the number of legal maximum regular hours (40) to get the regular hourly rate.
3. If you are paid by the piece or commission, either of the following methods may be used to determine the regular rate of pay for purposes of computing overtime:
· The piece or commission rate is used as the regular rate and you are paid one and one-half this rate for production during the first four overtime hours in a workday, and double time for all hours worked beyond 12 in a workday; or
· Divide your total earnings for the workweek, including earnings during overtime hours, by the total hours worked during the workweek, including the overtime hours. For each overtime hour worked you are entitled to an additional one-half the regular rate for hours requiring time and one-half, and to the full rate for hours requiring double time.
A group rate for piece workers is an acceptable method for computing the regular rate of pay. In using this method, the total number of pieces produced by the group is divided by the number of people in the group, with each person being paid accordingly. The regular rate for each worker is determined by dividing the pay received by the number of hours worked. The regular rate cannot be less than the minimum wage.
4. If you are paid two or more rates by the same employer during the workweek, the regular rate is the “weighted average” which is determined by dividing your total earnings for the workweek, including earnings during overtime hours, by the total hours worked during the workweek, including the overtime hours. For example, if you work 32 hours at $11.00 an hour and 10 hours during the same workweek at $9.00 an hour, your weighted average (and thus the regular rate for that workweek) is $10.52. This is calculated by adding your $442 straight time pay for the workweek [(32hours x $11.00/hour) + (10 hours x $9.00/hour) = $442] and dividing it by the 42 hours you worked.
What if I work overtime but it hasn’t been authorized by my supervisor? Do they still have to pay me for my overtime?
Your employer is still required to pay you overtime for the hours worked in excess of the regular 40 per week or 8 per day, whichever applies. California law requires that employers pay overtime, whether authorized or not, at the rate of one and one-half times the employee’s regular rate of pay for all hours worked in excess of eight up to and including 12 hours in any workday, and for the first eight hours of work on the seventh consecutive day of work in a workweek, and double the employee’s regular rate of pay for all hours worked in excess of 12 in any workday and for all hours worked in excess of eight on the seventh consecutive day of work in a workweek.
You can be disciplined for violating your company’s overtime policy, however, if you work unauthorized overtime. Even though you are reprimanded, your employer is still required to pay you for any hours you are “suffered or permitted to work, whether or not required to do so.” California case law holds that “suffer or permit” means work the employer knew or should have known about. Thus, an employee cannot deliberately prevent the employer from obtaining knowledge of the unauthorized overtime worked, and come back later to claim recovery. The employer must have the opportunity to obey the law.
I get bonuses a work. Should those amounts be included when I calculate my regular rate of pay?
It depends on the type of bonus you receive. Yes, if it is a nondiscretionary bonus. A nondiscretionary bonus is included in determining the regular rate of pay for computing overtime when it is based upon hours worked, production or proficiency.
Discretionary bonuses or sums paid as gifts at a holiday or other special occasions, such as a reward for good service, which are not measured by or dependent upon hours worked, production or efficiency, are not included for purposes of determining the regular rate of pay.
Are any amounts excluded from the regular rate of pay?
Yes, there are certain types of payments that are excluded from the regular rate of pay. Examples of some of the more common exclusions are sums paid as gifts for special occasions, expense reimbursements, payments made for occasional periods when no work is performed due to vacation, holiday, illness, failure of the employer to provide sufficient work, premium pay for Saturday, Sunday, or holiday work, and discretionary bonuses.
Are salaried employees entitled to overtime?
It depends. A salaried employee must be paid overtime unless they meet the test for exempt status as defined by federal and state laws, or unless they are specifically exempted from overtime by the provisions of one of the Industrial Welfare Commission Wage Orders regulating wages, hours and working conditions.
How is overtime calculated if I work at different rates of pay in the same workweek?
If you are paid two or more rates by the same employer during the workweek, the regular rate is the “weighted average” which is determined by dividing your total earnings for the workweek, including earnings during overtime hours, by the total hours worked during the workweek, including the overtime hours. For example, if you work 32 hours at $11.00 an hour and 10 hours during the same workweek at $9.00 an hour, the weighted average (and thus the regular rate for that workweek) is $10.52. This is calculated by adding your $442 straight time pay for the workweek [(32hours x $11.00/hour) + (10 hours x $9.00/hour) = $442] and dividing it by the 42 hours you worked.
Can an employer require an employee to work overtime?
Yes, an employer may dictate the employee’s work schedule and hours. Additionally, under most circumstances the employer may discipline an employee, up to and including termination, if the employee refuses to work scheduled overtime.
Last week I worked Monday, Tuesday, Wednesday, Thursday and Saturday, eight hours each day. I was out ill all day Friday. For the workweek I was paid 48 hours at my regular hourly rate. Am I entitled to eight hours of overtime pay?
No, you are not entitled to any overtime pay. Overtime is calculated based on hours actually worked, and you worked only 40 hours during the workweek. Another example of where you get paid your regular wages but the time is not counted towards overtime is if you get paid for a holiday but do not work that day. In such a case, the time upon which the holiday pay is based does not count as hours worked for purposes of determining overtime because no work was performed.
When must I be paid for the overtime hours I work?
Overtime wages must be paid no later than the payday for the next regular payroll period after which the overtime wages were earned. Only the payment of overtime wages may be delayed to the payday of the next following payroll period as the straight time wages must still be paid within the time set forth in the applicable Labor Code section in the pay period in which they were earned; or, in the case of employees who are paid on a weekly, biwe ekly, or semimonthly basis, not more than seven calendar days following the close of the payroll period.
Can an employee waive his or her right to overtime compensation?
No, California law requires that an employee be paid all overtime compensation notwithstanding any agreement to work for a lesser wage. Consequently, such an agreement or “waiver” will not prevent an employee from recovering the difference between the wages paid the employee and the overtime compensation he or she is entitled to receive.
What can I do if my employer doesn’t pay me my overtime wages?
Contact us immediately, especially if you have co-worker’s being treated in a similar fashion. We can file a lawsuit in court against your employer in to recover the lost wages. Additionally, if you no longer work for this employer, you can make a claim for the waiting time penalty.
What can I do if my employer retaliates against me because I told him I was going to file a wage claim for unpaid overtime?
Contact us as soon as you feel your employer is engaged in retaliatory behavior. If your employer discriminates or retaliates against you in any manner whatsoever, for example, he discharges you because you file a wage claim or threaten to file a wage claim with the Labor Commissioner, we can file a lawsuit in court against your employer.
What are the basic requirements for rest periods under California law?
Employers of California employees covered by the rest period provisions of the Industrial Welfare Commission Wage Orders must authorize and permit a net 10-minute paid rest period for every four hours worked or major fraction thereof. Insofar as is practicable, the rest period should be in the middle of the work period. If an employer does not authorize or permit a rest period, the employer shall pay the employee one hour of pay at the employee’s regular rate of pay for each workday that the rest period is not provided.
Must the rest periods always be in the middle of each four-hour work period?
Rest breaks must be given as close to the middle of the four-hour work period as is practicable. If the nature or circumstances of the work prevent the employer from giving the break at the preferred time, the employee must still receive the required break, but may take it at another point in the work period.
M y employer is not allowing me to take a rest period. Is there anything I can do about this situation?
Yes, there is something you can do if you are an employee covered by the rest period requirements of the Industrial Welfare Commission Wage Orders. If your employer fails to authorize and permit the required rest period(s), you are to be paid one hour of pay at your regular rate of compensation for each workday that the rest period is not authorized or permitted. If your employer fails to pay the additional one-hour’s pay, you may file a wage claim with the Division of Labor Standards Enforcement.
Is it permissible if I choose to work through both of my rest periods so that I can leave my job 20 minutes early?
No, working through your rest period does not entitle you to leave work early or arrive late.
Can my employer require that I stay on the work premises during my rest period?
Yes, your employer can require that you stay on the premises during your rest break. Since you are being compensated for the time during your rest period, your employer can require that you remain on its premises. And under most situations, the employer is required to provide suitable resting facilities that shall be available for employees during working hours in an area separate from the toilet rooms.
Can I have additional rest breaks if I am a smoker?
No, under California law rest period time is based on the total hours worked daily, and only one ten-minute rest period need be authorized for every four hours of work or major fraction thereof.
When I need to use the toilet facilities during my work period does that count as my ten minute rest break?
No, the 10-minute rest period is not designed to be exclusively for use of toilet facilities as evidenced by the fact that the Industrial Welfare Commission requires suitable resting facilities be in an area “separate from toilet rooms.” The intent of the Industrial Welfare Commission regarding rest periods is clear: the rest period is not to be confused with or limited to breaks taken by employees to use toilet facilities. This conclusion is required by a reading of the provisions of IWC Orders, Section 12, Rest Periods, in conjunction with the provisions of Section 13(B), Change Rooms And Resting Facilities, which requires that “Suitable resting facilities shall be provided in an area separate from the toilet rooms and shall be available to employees during work hours.”
Allowing employees to use toilet facilities during working hours does not meet the employer’s obligation to provide rest periods as required by the IWC Orders. This is not to say, of course, that employers do not have the right to reasonably limit the amount of time an employee may be absent from his or her work station; and, it does not indicate that an employee who chooses to use the toilet facilities while on an authorized break may extend the break time by doing so. DLSE policy simply prohibits an employer from requiring that employees count any separate use of toilet facilities as a rest period.
I am regularly scheduled to work an eight-hour shift. What can I do if my employer doesn’t allow me to take a rest break?
You can either file a wage claim (the Labor Commissioner’s Office), or you can file a lawsuit in court against your employer to recover the premium of one additional hour of pay at your regular rate of compensation for each workday that the rest period is not provided.
What happens if my employer does not provide me with the opportunity to take a break for lactation purposes?
If you feel your employer is not providing you with adequate break time and/or a place to express milk as provided for in Labor Code section 1030, you may file a report/claim with the DLSE Bureau of Field Enforcement (BOFE) at the BOFE office nearest your place of employment. See http://www.dir.ca.gov/dlse/HowToReportViolationtoBOFE.htm.
The DLSE may, after an inspection, issue to an employer who violates any provision of this chapter, a civil citation ($100.00 for each violation) that may be contested in accordance with the procedure outlined in Labor Code Section 1197.1 (Labor Code Section 1033).
In addition, any employee who is a victim of retaliation for either asserting a right to lactation accommodation or for complaining to the DLSE about the failure of an employer to provide this accommodation may file a retaliation claim with DLSE pursuant to Labor Code Section 98.7.
What is the applicable statute of limitations on filing a rest period claim?
In the case of Murphy v. Cole, the California Supreme Court held that the remedy for meal and rest period violations of “one additional hour of pay” under Labor Code section 226.7 is a wage subject to a three-year statute of limitations. Accordingly, a claim must be filed within three (3) years of the alleged rest period violation. See attached Division memoranda regarding the Court’s decision.
What can I do if my employer retaliates against me because I objected to the fact that he doesn’t provide employees with rest breaks?
If your employer discriminates or retaliates against you in any manner whatsoever, for example, he discharges you because you object to the fact that he’s not providing employees with rest breaks, or because you file a claim or threaten to file a claim with the Labor Commissioner, you can file a discrimination/retaliation complaint with the Labor Commissioner’s Office. In the alternative, you can file a lawsuit in court against your employer.
My employer’s vacation plan states that no vacation is earned during the first six months of employment. Is this legal?
Yes. DLSE’s enforcement policy does not preclude an employer from providing a specific period of time at the beginning of the employment relationship during which an employee does not earn any vacation benefits. This could apply to a probationary or introductory period, and can even apply to the whole first year of employment. Such a provision in a vacation plan will only be recognized, however, if it is not a subterfuge (phony reason) and in fact, no vacation is implicitly earned or accrued during that first year or other period. For example, a plan with the following provisions would be an obvious subterfuge and not recognized as valid:
· Year 1: No vacation
· Year 2: 4 weeks vacation
· Year 3: 2 weeks vacation
The four weeks’ vacation earned in the second year, when viewed in the context of the two weeks’ vacation earned in the third year, makes it clear that two of the four weeks earned in year two are actually vacation earned in year one.
A valid vacation plan could look like the following:
· Year 1: No vacation
· Year 2: 2 weeks vacation
· Year 3: 3 weeks vacation
· Years 4 through 10: 4 weeks vacation
In those instances where a “waiting period” (Year 1 in the examples above) is found to be a subterfuge, employees who separate from their employment during the “waiting period” will be entitled to prorated vacation pay at their final rate of pay. On the other hand, where the employer’s vacation plan has a valid “waiting period” provision, employees who separate from their employment during that period will be ineligible for any vacation pay.
How is vacation earned?
In California, because paid vacation is a form of wages, it is earned as labor is performed. An employer’s vacation plan may provide for the earning of vacation benefits on a day-by-day, by the week, by the pay period, or some other period basis. For example, an employer’s policy may provide that an employee will earn a proportionate share of his or her annual vacation entitlement for each week of a calendar year in which the employee either works at least one full day or receives at least one full days’ pay during such week. Thus, for example, if an employee is entitled to two weeks (10 work days) annual vacation, and works full-time, eight hours per day, 40 hours per week, in the above example for each week the employee works at least one full day, he or she will earn 1.538 hours of paid vacation, calculated as follows:
10 work days entitlement per year x 8 hours/day = 80 hours vacation entitlement per year
80 hours vacation entitlement per year ÷ 52 weeks per year = 1.538 hours of vacation earned per week
In contrast to how vacation pay may be earned, the calculation of vacation pay for terminating employees (a quit, discharge, death, end of contract, etc.) who have earned and accrued and unused vacation on the books at the time of termination must be prorated on a daily basis and must be paid at the final rate of pay in effect as of the date of the separation. For example, an employee who is entitled to three weeks of annual vacation (15 work days entitlement per year x 8 hours/day = 120 hours vacation entitlement per year) who quits on August 7, 2002 (the 219th day of the year) without having taken any vacation in 2002, who has no vacation carry-over from prior years, and whose final rate of pay is $13.00 per hour, would be entitled to $936.00 vacation pay upon separation, calculated as follows:
Pro rata daily basis:
219 days (August 7, 2002, date of quit) ÷ 365 days/year = 60%
60% of 120 hours vacation entitlement = 72 hours vacation earned and accrued through August 7, 2002 Vacation days used in 2002 = 0
Vacation earned but not taken at time of separation = 72 hours
72 hours x $13.00/hour = $936.00 vacation pay due at separation.
I am a part-time employee, and am excluded from my employer’s vacation plan (only full-time employees get vacation). Is this legal?
Yes, it is legal. If an employer’s vacation plan/policy excludes certain classes of employees, such as part-time, temporary, casual, probationary, etc., such a provision is valid, and the agreement will govern. To avoid any misunderstandings in this area, the vacation plan/policy should state clearly and specifically which employee classification(s) are excluded.
My employer’s vacation policy provides that if I do not use all of my annual vacation entitlement by the end of the year, that I lose the unused balance. Is this legal?
No, such a provision is not legal. In California, vacation pay is another form of wages which vests as it is earned (in this context, “vests” means you are invested or endowed with rights in the wages). Accordingly, a policy that provides for the forfeiture of vacation pay that is not used by a specified date (“use it or lose it”) is an illegal policy under California law and will not be recognized by the Labor Commissioner.
My employer’s vacation policy provides that once an employee earns 200 hours of vacation, no more vacation may be earned (accrued) until the vacation balance falls below that level. Is this legal?
Yes, such a provision would be acceptable to the Labor Commissioner. Unlike “use it or lose it” policies, a vacation policy that places a “cap” or “ceiling” on vacation pay accruals is permissible. Whereas a “use it or lose it” policy results in a forfeiture of accrued vacation pay, a “cap” simply places a limit on the amount of vacation that can accrue; that is, once a certain level or amount of accrued vacation is earned but not taken, no further vacation or vacation pay accrues until the balance falls below the cap. The time periods involved for taking vacation must, of course, be reasonable. If implementation of a “cap” is a subterfuge to deny employees vacation or vacation benefits, the policy will not be recognized by the Labor Commissioner.
DLSE has repeatedly found vacation policies which provide that all vacation must be taken in the year it is earned (or in a very limited period following the accrual period) are unfair and will not be enforced by the Division.
Can my employer tell me when to take my vacation?
Yes, your employer has the right to manage its vacation pay responsibilities, and one of the ways it can do this is by controlling when vacation can be taken and the amount of vacation that may be taken at any particular time.
My employer’s vacation policy provides that if I don’t use all of my vacation by the end of the year, he will pay me for the vacation that I earned and accrued that year, but did not take. Is this legal?
Yes, your employer has the right to manage its vacation pay responsibilities, and one of the ways it can do this is by paying you off each year for vacation that you earned and accrued that year, but did not take.
My employer has combined its vacation and sick leave plans into one program that it calls “paid time off” (PTO). Under this program I have a certain number of paid days each year that I can take off from work for any purpose. Does this allow my employer to circumvent the law as it relates to vacations?
No, a “paid time off” (PTO) plan or policy does not allow your employer to circumvent the law with respect to vacations. Where an employer replaces its separate arrangements for vacation and sick leave with a program whereby employees are granted a certain number of “paid days off” each year that can be used for any purpose, including vacation and sick leave, the employees have an absolute right to take these days off. Consequently, again applying the principles of equity and fairness, DLSE takes the position that such a program is subject to the same rules as other vacation policies. Thus, for example, the “paid time off” is earned on a day-by-day basis, vested paid time off days cannot be forfeited, the number of earned and accrued paid time off days can be capped, and if an employee has earned and accrued paid time off days that have not been used at the time the employment relationship ends, the employee must be paid for these days.
My boss has a policy where we can take our vacation on an advanced basis, meaning that we can take vacation days BEFORE they are earned or accrued. Last month, I took two of my weeks of vacation for the upcoming year before they were earned. I just quit my job and my employer deducted all of that unearned vacation time from my final paycheck. This cut my check down to almost nothing. Is that legal?
It certainly is not. An employer cannot deduct from your last paycheck the vacation you took, even though you took it on an advance basis, (i.e., you had taken it before you actually earned or accrued it). Allowing advance vacations is not uncommon, because many employers want their employees to take vacations during ‘down time’ and also to accommodate the schedules of the employees themselves, especially those with children wishing to take vacation while the kids are out of school. Allowing employees to take vacations before they are actually earned can benefit the employer in many situations. But there is nothing REQUIRING your employer to offer this type of arrangement. If they do, however, they must abide by California law which states clearly that vacation days are considered wages, and an employer’s practice of allowing employees to take their vacation before it is actually earned or accrued is in effect an advance on wages. Thus, if an employee takes an advance on vacation and then quits or is discharged before all of that advanced vacation is earned or accrued, the effect is that there has been an overpayment of wages which is a debt owed to the employer.
The California courts have noted on a number of occasions that an advance on wages, as with any other debt owed (either to the employer or a third party), is subject to the provisions of the attachment law. However, since wages are exempt from prejudgment attachment, neither the employer nor any third party can recover the debt by way of attachment of the employee’s final pay, as to do so would violate the public policy considerations underlying the wage exemption statutes. Thus, in California since the wage garnishment law provides the exclusive judicial procedure by which a judgment creditor can execute against the wages of a judgment debtor, an employer may not resort to self-help to recover debts owed to the employer by an employee from the wages then due to the employee.
If I quit my job, or if I am terminated, what happens to all of the vacation I have been accruing and have earned but haven’t yet taken?
In your case California law protects you and requires that your employer pay you for your unused and accrued vacation. Unless you are subject to a collective bargaining agreement that stipulates otherwise, whenever an employee is terminated or quits, for any reason, and that employee has vacation time that has accrued and earned but hasn’t been used, the employer is required to pay the employee at his or her final rate of pay for all of that vacation time. While this may result in a rather large final paycheck and put your employer under some pressure, this is well established and there is no way around it for your former employer. The reason being that vacation benefits are considered wages in California, and payment for those hours MUST be included in your final paycheck.
My supervisor said that it is company policy that when an employee quits, they forfeit unused vacation and that we cannot carry forward unused vacation time from year to year. I was terminated a few weeks ago and none of my vacation days were included in my final paycheck. Do I have a cause of action? What can I do?
You certainly do, and you should pursue this matter through our office, especially if other employees are being treated in the same unlawful manner. We can either file a wage claim with the DLSE, or we can file a lawsuit in court against your employer to recover the lost wages. Additionally, since you were terminated and no longer work there, we can make a claim for the waiting time penalty pursuant to Labor Code Section 203.
I think my employer is retaliating against me because I complained that my vacation time was being forfeited, and pointed out that that is against the law. What can I do?
You should give us a call or use the Contact form on our website, if you feel that your employer has discriminated or retaliated against you in any manner whatsoever. Examples of retaliation may include, being discharged because you objected to the fact that your vested vacation was being forfeited and not carried over from year-to-year, or because you filed a claim or threatened to file a claim with the Labor Commissioner. Contact us for a free consultation so that we can evaluate the facts of your case. It is possible that your employer will be liable to you for monetary damages.