C ASE L AW C OSMOS : A S TATE AND F EDERAL E MPLOYMENT L AW U PDATE - - PDF document

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CASE LAW COSMOS: A STATE AND FEDERAL EMPLOYMENT LAW UPDATE

Tara O’Hanlon and Jeffrey Chicoine I. OREGON. A. Court opinions. 1. Unemployment benefits: Nielsen v. Employment Dept., 263 Or. App. 274, 328 P.3d 707 (2014). Plaintiff, Nielsen, worked for defendant Westwind Landscape Supply as an office manager for about one year. During that time, Westwind repeatedly failed to pay her (and other employees) for her overtime work, and she witnessed physical fights between employees and management when employees complained about unpaid overtime. Nielsen did not want to push the issue of her missing overtime pay with Westwind management because she was scared of a confrontation, so she quit her job and filed for unemployment benefits. But the Employment Department denied her application on the grounds that she had voluntarily left work. The Oregon Court of Appeals held that Nielsen was eligible for unemployment benefits, since she had shown good cause for leaving her position at Westwind. The court noted that the alternatives to voluntarily leaving Westwind were not reasonable: if Nielsen had complained to the Bureau of Labor and Industries (“BOLI”), she would have subjected herself to

• ngoing underpayment, and if she had complained to her supervisors, she risked a frightening

and possibly violent confrontation. Since there was no reasonable alternative to leaving her job, the court found that Nielsen had good cause for quitting, and the Employment Department should not have denied her application for unemployment compensation. 2. Definition of “employee” under minimum-wage laws: Cejas Commercial Interiors, Inc. v. Torres-Lizama, 260 Or. App. 87, 316 P.3d 389 (2013). A construction contractor brought a declaratory judgment action against drywall workers, seeking a declaration that the workers were not employees of the contractor under Oregon’s minimum-wage law (ORS 653.025). The court determined that the economic-realities test and not the right-to-control test should apply. Under that test, the courts look at formal and functional control factors. The court held that the contractor did not formally or functionally control the drywall workers because the workers were involved with a small portion of the project, had no association outside the one project, and were supervised by their employer, a subcontractor, who assumed the risk for the profitability of the work.

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3. Liability for wage violations of predecessor: Blachana, LLC v. Bureau

• f Labor and Industries, 354 Or. 676, 318 P.3d 735 (2014).

Plaintiff, an operator of a bar and restaurant, sought Oregon Supreme Court review of a BOLI order requiring plaintiff to reimburse BOLI for payment of wage violations of the operator’s predecessor. The Oregon Supreme Court held that the operator was a “successor” under the wage-claim statute because the name and identity of the establishment was similar under the prior owners and current operator, the location did not change, the client base was similar, only 47 days had elapsed from the date the predecessor closed its doors until the current

• perator reopened for business, and the current operator used much of the same equipment, even

though the claimants had never worked for the current operator. 4. Constructive discharge/public employer: Nkrumah v. City of Portland, 261 Or. App. 365, 323 P.3d 453 (2014). A communications director for a former mayor brought wrongful-discharge and wage claims against the city, and the trial court granted summary judgment for the city. The court of appeals held that the communications director had failed to establish constructive

• discharge. The court noted that the employee must show that he quit because of an “objectively

intolerable condition” that the employer intentionally created. The court further reasoned that in a wrongful-discharge case, the “the intolerable conditions must be created as the result of the employee’s fulfillment of—or attempt to fulfill—an important public duty.” Here, the employee

• bjected to Mayor Adams’s allegedly lying about a relationship with an underage person, but

there was no evidence that plaintiff was ever required to lie to the public. Thus, even if being truthful to the public was an important societal duty under the wrongful-discharge standard, the evidence did not support a constructive-discharge claim that action was taken against plaintiff for being truthful. 5. Class action/joint employment: Delgado v. Del Monte Fresh Produce, N.A., Inc., 260 Or. App. 480, 317 P.3d 419, rev. denied, 355 Or. 380. Del Monte appealed various judgments related to a class-action claim brought by minimum-wage production workers regarding the donning and doffing of protective clothing off the clock before and after work and before and after the 30-minute lunch break. Plaintiffs claimed that Del Monte was their joint employer in addition to the direct employer, a staffing

• company. The court of appeals upheld the class certification because all class members were

minimum-wage workers who worked at the same facility during a specified period, and the claims of all class members were based on the theory that Del Monte had a custom or practice of requiring or permitting the employees to don and doff necessary work clothing off the clock and during the meal break, resulting in unpaid work time. 6. Public employer/unfair labor practice: Am. Fed’n of State, Cnty. &

• Mun. Emps. v. City of Lebanon, No. A152059, 265 Or. App. __, __ P.3d

__ (Sept. 4, 2014). The court of appeals reversed an order of the Employment Relations Board that found that the city had committed an unfair labor practice against a union under ORS 243.672

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because a city councilor wrote a letter criticizing unions and sent it to a local paper. The court explained that the councilor was not acting as the city’s agent or apparent agent when she wrote and sent her letter and that there was nothing to indicate that this letter-writing was “ordinarily entrusted” to someone in that position, it was not on city stationery, and it was not written on city property or during business hours. 7. Employees versus independent contractors: Broadway Cab LLC v. Emp’t Dep’t, 265 Or. App. __, __ P.3d __ (Sept. 4, 2014). Taxicab drivers were held to be employees of a taxicab company, not independent contractors, and the employer was held liable for unemployment insurance tax. The court reasoned that the drivers leased their vehicles from the company and did not own them, and that the company controlled access to the vehicles during off hours, provided maintenance, and controlled parking, among other factors. The court held that the cab drivers provided “services” for “remuneration” under ORS 657.030 and that they did not fall within the statutory exemption for independent contractors under ORS 670.600(2). 8. Employees versus independent contractors: Ponderosa Properties, LLC

• v. Employment Dept., 262 Or. App. 419, 325 P.3d 762 (2014).

Ponderosa contracted with a resort community to provide maintenance and cleaning services to the community’s houses. Ponderosa engaged 21 employees to do this work. Believing the employees were independent contractors, Ponderosa did not pay unemployment taxes on their wages, and the Employment Department instituted this action. The evidence showed that Ponderosa instructed its workers regarding which houses to clean and the deadline by which the work needed to be done. Otherwise, workers set their own schedule, used their

• wn equipment, and did not have a particular set of procedures to follow to get the work done.

Ponderosa did check the jobs after they were completed, and occasionally required the workers to redo a job if it was not up to Ponderosa’s standards. The court held that it was impossible for even the most independent of contractors to be completely free of a client’s control, so it was not dispositive that Ponderosa gave the workers deadlines and was able to check their final work. Although Ponderosa set pay rates and deadlines, it did not control the means and manner in which the work was to be performed. Moreover, the deadlines were determined not by Ponderosa but by the occupancy schedules of the community’s houses. Therefore, the workers were independent contractors, not employees

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9. Boyle v. City of Portland, No. 1305-07824 (2014). A jury awarded plaintiff Michael Boyle $226,000 because it found that the City of Portland had failed to give Mr. Boyle preferential treatment based on his status as a disabled veteran after his job was eliminated and returned to work for the city as a part-time employee. Plaintiff had also sued the City of Portland for age discrimination, a claim that the jury rejected. The jury awarded damages based on plaintiff’s disabled veteran status because it found that under the revised state law on preferential treatment afforded to veterans and disabled veterans, the city had not given plaintiff the proper credit for his status.

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B. Legislation: Oregon 2014 session/Portland ordinances. 1. Portland sick-leave ordinance. Portland’s sick-leave ordinance has been in effect since January 1, 2014. Key points to remember:  Paid sick time must be provided by employers of six or more

• employees. Unpaid sick time must be provided by smaller employers.

The ordinance applies only to private employers.  All employers must provide one hour of sick time for every 30 hours of work performed by any employee (including overtime work).  Salaried overtime-exempt employees earn sick time at a presumed 40 hours per week or their regular workweek if less than 40 hours per week.  Employers can cap accrued sick time at 40 hours, but are permitted to allow for more accrual. An employee may roll over up to 40 hours of unused sick time from year to year.  The final rules require that an employer give each employee notice on a quarterly basis of the amount of accrued and unused sick time available for use by that employee.  Employees covered: All employees working in Portland accrue sick time for time spent working in Portland; any employee who works from home in the city is covered even if the employer is outside the city; employees traveling to or conducting business in the city earn the benefit for the time spent in the city; temporary workers are covered (for the purposes of the ordinance, however, temps provided by a staffing agency are considered employees of the staffing agency).  Employees not covered: Employees working outside the city even if the employer is located in the city (includes telecommuters working from homes outside the city even if the employer is located in the city); employees based outside the city (a) who are simply passing through the city and do not stop in the city “as a purpose of their work,” and (b) who make only incidental stops (eating a meal, purchasing gas, changing a flat); independent contractors.  Employers must keep records on sick-time accrual and hours worked for two years.

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 Sick time is accrued from the date of hire or January 1, 2014. Employees must be eligible for sick time that they have accrued by working at least 240 hours in a calendar year.  Posting required: Employers are required to inform employees of “their entitlement to Sick Time; the amount of Sick Time and the terms of its use guaranteed under the Ordinance; the prohibition of retaliation against Employees who request or use Sick Time; and an Employee’s right to file a complaint if Sick Time as required by the Ordinance is denied by the Employer, or if an Employee is retaliated against for requesting or taking Sick Time.” The city has published sample posters in English, Spanish, Vietnamese, Chinese, and Russian (https://www.portlandoregon.gov/sicktime/63899). 2. Eugene sick-leave ordinance. Effective July 1, 2015, eligible workers will begin accruing sick time. Final rules are scheduled to be issued by January 31, 2015. The ordinance requires that employees earn a minimum of one hour of sick leave for every 30 hours of work performed in the Eugene city limits, up to a maximum of 40 hours of leave per year. Employees must be employed for 90 days to become eligible to begin using accrued sick time. The law applies to employees who work 240 hours or more a year in Eugene, regardless of whether the work is temporary or permanent. 3. Publication of Employment Appeals Board decisions. Effective March 6, 2014, the Employment Department is authorized to publish Employment Appeals Board (“EAB”) decisions on contested unemployment insurance claims. The EAB decisions were previously published on its website until 2013. ORS 657.665; HB 4010. 4. Employers with self-insured health benefit plans. This bill, effective March 13, 2014, deletes the previous prohibition that an insurer could not issue a stop-loss insurance policy against the risk of catastrophic loss assumed under a less than fully insured employee health benefit plan to a small employer. Small employers were previously excluded from purchasing these policies. Under House Bill 2240, passed in 2013, “small group” will be redefined, effective 2016, to include groups with 1-100 employees instead of 1-50. This would have left a large number of self-insured employers with 51-100 employees that would have been excluded from purchasing catastrophic coverage. ORS 742.065; HB 4050. 5. Workers’ compensation: interim medical benefits for pending claims. A worker is entitled to interim medical benefits during the time after an employer has been given notice of a claim but before a claim is accepted or denied (within 60 days of notice of claim). This bill, effective January 1, 2015, deletes limitations on the types of services that are covered during the interim period. Health benefit plans are required to expedite

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preauthorizations and guarantee payment of expenses for medical services provided before the claim is accepted or denied. If the claim is accepted, a workers’ compensation insurer or self- insured employer must pay for services provided. ORS 656.247; HB 414. 6. Self-insured employer groups and workers’ compensation. The Director of the Department of Consumer and Business Services is authorized to set rules to demonstrate financial viability to qualify to self-insure. The Director is authorized to revoke certification of self-insured employers in default and for violation of the rules. ORS ch. 656 et seq.; SB 1558. 7. Minimum wage going up in 2015. Minimum wage in Oregon will increase from $9.10 per hour to $9.25 per hour effective January 1, 2015. II. WASHINGTON. A. Court opinions. 1. Tortious interference with a business relationship: Tamosaitis v. Bechtel Nat’l, Inc., No. 31451-1-III, __ Wn. App. __, __ P.3d __ (July 1, 2014). The plaintiff, a project manager at a nuclear technology company, was reassigned to a different position following interpersonal difficulties with other members of his team. The plaintiff’s employment was not terminated as a result of the reassignment, nor was his salary

• decreased. His claims were only for emotional distress and speculative harm to his reputation.

The Washington Court of Appeals held that pecuniary loss was a required element of tortious interference, although once financial damages had been established, additional damages could be recovered as well. The plaintiff’s case was dismissed for failure to prove monetary damages. 2. Wage-and-hour and salary claims. a. Rekhter v. State, Dep’t of Soc. & Health Servs., 180 Wn.2d 102, 323 P.3d 1036 (2014). DSHS contracts with individual healthcare providers to offer publicly funded home care for people with disabilities. In their contracts with DSHS, the providers agree to assist with tasks in a given client’s “service plan” and agree that they will be paid only for those

• tasks. Beginning in 2003, DSHS instituted a policy providing that caregivers who lived with

their clients would have their services—and pay—cut by 15 percent, under the rationale that the caregivers should not be compensating for such things as grocery shopping and cleaning that they would do in their own homes for free. The 15 percent cut applied to all providers, even if a client’s service plan specified that he or she needed help with such household tasks. A group of providers brought a class-action lawsuit against DSHS for breaching its duty of good faith and fair dealing in relation to their contracts.

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The Washington Supreme Court held that DSHS did not need to breach an express contractual term for the duty of good faith to be violated, particularly when, as DSHS was, one party was given unilateral discretion over future terms. But the court also upheld judgment for DSHS on the caregivers’ claims for unpaid wages, ruling that DSHS’s role as a payor of Medicare funds did not create an agency or employment relationship between the state and the caregivers, so the state Minimum Wage Act did not apply. Finally, the court granted DSHS’s appeal of prejudgment interest, holding that because each caregiver’s work time was not entered or collected during the times at issue, the caregivers’ damages couldn’t be proved with specificity. b. Storti v. Univ. of Wash., No. 88323-8, __ Wn.2d __, __ P.3d __ (July 24, 2014). Petitioners, a class of professors, sued the university where they worked after the university failed to provide a planned annual raise. The university argued that it had reserved the right in its contract to suspend the raises if, as was the case, the state legislature did not provide sufficient funds to allow the raises. The professors claimed that by teaching well and being deemed “meritorious in performance,” they had already substantially performed under the contract. The court first examined the professors’ argument that the university had offered a unilateral contract for the raises, and they had accepted; by working most of the 2008-2009 school year in reliance on the promise of a raise for the 2009-2010 school year, they had substantially performed as required by the contract. The court agreed, and found that the professors had accepted. Finally, the court held that the professors had established consideration by working at the university and refraining from taking jobs elsewhere, so a valid unilateral contract existed. The court disagreed with the professors, however, regarding whether the contract had been breached. The court held that the university had reserved the right to “reevaluate” the raise policy, and had followed the correct procedures for doing so. There was no requirement that changes to the policy be delayed until the next academic year, so the university did not breach the contract. c. Failla v. FixtureOne Corp., No. 89671-2, __ Wn.2d __, __ P.3d __ (Oct. 2, 2014). The Washington State Supreme Court held that Washington courts have personal jurisdiction over a CEO who lives and works in another state and did not personally set foot in the state. Plaintiff brought claims against her employer and the CEO of her employer for withholding commissions under Washington's wage laws. The CEO moved for summary judgment, arguing that the court lacked personal jurisdiction because the business did not operate in Washington, the CEO interacted with plaintiff only through e-mail, and the CEO was never physically in Washington. The Washington Supreme Court disagreed, affirming the trial court, and holding that the CEO had sufficient contact with Washington and could be held personally liable because the CEO was the individual who had interviewed, hired, and promoted plaintiff, set her salary and commission rate, signed her paychecks, and had regular and frequent e-mail

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communications with her over her two years of employment, and was apparently the only person at the company with whom plaintiff had contact. The court held that the CEO should have reasonably anticipated that he would have to defend himself in Washington against a claim when he decided to stop paying plaintiff. d. Becerra v. Expert Janitorial, LLC, __ Wn.2d __, 332 P.3d 415 (Aug. 7, 2014). Plaintiffs, janitors who performed cleaning tasks at grocery stores, brought claims against the owner of the stores and a contractor that subcontracted its cleaning contracts to the janitors’ direct employer under the Washington Minimum Wage Act, claiming that the owner and contractor were the janitors’ joint employers. The trial court granted summary judgment in favor of the owner and contractor, and the court of appeals reversed and remanded. The Washington Supreme Court adopted the Ninth Circuit test for joint employment in Torres-Lopez

• v. May, 111 F.3d 633 (9th Cir. 1997), and remanded to the trial court to consider these factors,

holding that the trial court’s finding was insufficient to support summary judgment. e. Jumamil v. Lakeside Casino, LLC, 179 Wn. App. 665, 319 P.3d 868 (2014). Plaintiff, a poker dealer at a casino, sued her employer and managers over a “dealer support” policy requiring dealers to gamble at the casino for at least six hours a week to retain their seniority, claiming that the policy ultimately caused the casino to withhold her wages. The Washington Court of Appeals held that the manager of the LLC was liable for failing to return the plaintiff’s wages after learning of the dealer support policy, noting that laws against wage rebates applied even though the manager was neither aware of the policy nor responsible for wages while the plaintiff was employed. 3. Anti-SLAPP statutes: Alaska Structures, Inc. v. Hedlund, 180 Wn. App. 591, 323 P.3d 1082 (2014). Hedlund was employed by Alaska Structures, a contractor with the U.S. military. As part of his employment, Hedlund was required to sign a confidentiality agreement regarding Alaska Structures’ business practices. After Hedlund quit, he was discovered to have written posts complaining about the insufficient security at Alaska Structures on a message board used by job-seekers. Alaska Structures sued him for breach of the confidentiality agreement, and Hedlund moved to dismiss the claim under Washington’s anti-SLAPP statute. The Washington Court of Appeals held that the statute did not protect against speech that was otherwise unlawful

• r unprotected; although consumer information on public websites had been protected in

previous anti-SLAPP suits, Hedlund’s comments were not broadly applicable to consumers trying to make an informed choice, and they breached the confidentiality agreement as well.

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4. Discrimination/retaliation. a. Kumar v. Gate Gourmet, Inc., 180 Wn.2d 481, 325 P.3d 193 (2014). Plaintiffs were employees of Gate Gourmet, a company that prepares meals to be served on airplanes and trains, and worked out of SeaTac Airport. For security reasons, they were not allowed to bring their own food to work, so Gate Gourmet provided meals at the worksite, one vegetarian and one with meat. The plaintiffs sued, claiming that the provided meal

• ptions were insufficient to meet their religious dietary restrictions—for instance, the vegetarian

meal was made with animal by-products, and the meat-based meal contained pork—and so they were forced to go without food during their shifts. The Washington Supreme Court held that the Washington Law Against Discrimination (“WLAD”) created a cause of action for an employer’s failure to accommodate employees’ religious practices, and that prima facie evidence of this claim could be shown by (1) demonstrating a bona fide religious belief, (2) informing the employer of the beliefs and the conflict, and (3) the employer’s responding with threatened or actual discriminatory treatment. Employers could then defend themselves by showing that they

• ffered a reasonable accommodation, or that an accommodation would be an undue hardship.

b. Currier v. Northland Servs., Inc., No. 70128-2-I, __ Wn. App. __, __ P.3d __ (Aug. 4, 2014). Plaintiff, an independent contractor truck driver, brought claims under WLAD for retaliatory discharge after his contract was terminated two days after he reported racially discriminatory comments made by other truck drivers about a Latino driver. The court of appeals, affirming the court’s decision in a bench trial, held that an independent contractor was permitted to bring a retaliation claim under WLAD, the contractor was engaged in a statutorily protected activity, there was a causal link between the activity and his terminated contract, and the damages award was supported by substantial evidence. c. Scrivener v. Clark Coll., No. 89377-2, 2014 WL 4648179, __ Wn.2d __, __ P.3d __ (Sept. 18, 2014). Plaintiff, a full-time, temporary member of the faculty at Clark College, was passed over for two tenure-track positions in her department and filed suit, alleging age

• discrimination. Plaintiff was 55 years old when she applied for and was denied the positions.

The two applicants who were hired were under the age of 40. The trial court granted summary judgment for the college, and the court of appeals affirmed. The Washington Supreme Court reversed, holding that plaintiff could establish pretext by showing that age discrimination was a substantial factor motivating the employer. The court also held that summary judgment should not have been granted because the college articulated only ambiguous reasons as to why plaintiff was not hired, stating that the other candidates were clearly qualified and were the “best fit,” and because of the president’s statements that the college needed “younger talent” and that 74 percent of the workforce was over 40.

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d. Ockletree v. Franciscan Health Sys., 179 Wn.2d 769, 317 P.3d 1009 (2014). A former employee of a nonprofit religious organization brought claims under WLAD after plaintiff’s employment was terminated following a stroke. Plaintiff, who is African-American, claimed that his employment had been terminated because of his disability and because of his race. The employer removed the case to federal court and moved to dismiss, arguing that it was exempt from WLAD as a nonprofit religious organization. The federal district court certified the question whether the religious-employer exemption in WLAD violates Washington’s constitution (establishment clause or privileges and immunities clause). The Washington Supreme Court, in a 4-4-1 decision, held that WLAD’s definition of “employer” was not facially unconstitutional. A majority of the court, however, joined in a separate opinion holding that as applied to this case with a plaintiff who worked as a hospital security guard unrelated to any religious mission of the hospital, the privileges and immunities clause was violated and the exemption is unconstitutional. 5. Wrongful discharge in violation of public policy: Rose v. Anderson Hay & Grain Co., No. 30545-7-III, __ Wn. App. __, __ P.3d __ (Sept. 25, 2014). Plaintiff sued his former employer, alleging wrongful discharge in violation of public policy after his related suit was dismissed in federal court because plaintiff failed to exhaust his administrative remedies. Plaintiff, a commercial truck driver, was required to bring his claim through the administrative process under the Commercial Motor Vehicle Safety Act (the "CMVSA"), which he failed to do. The Washington Court of Appeals affirmed the trial court's grant of summary judgment dismissing the claim for violation of public policy holding that plaintiff's remedies under the CMVSA more than adequately protected plaintiff's and the public's interests. 6. Arbitration and collective bargaining. a. Spokane Sch. Dist.

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v. Spokane Educ. Ass’n,

• No. 31522-3-III, __ Wn. App. __, __ P.3d __ (May 22, 2014).

The Spokane Education Association, a teachers’ union, represented provisional guidance counselor Nikki Easterling. Easterling was given a notice of nonrenewal by the school district, which cited attendance issues and noncompliance with school administrators as the reasons for the termination of employment. Her union representative then filed a grievance against the school district on her behalf; the collective bargaining agreement outlined a dispute- resolution policy consisting of one informal step and four formal steps, one of which was

• arbitration. The union requested arbitration on Easterling’s behalf, but the school district

refused, alleging that the claim was not arbitrable. The court held that since nonrenewal of provisional employees was expressly excluded from arbitration in the collective bargaining agreement, the union was barred from bringing a grievance related to those issues. The union’s attempt to bring grievances for other

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issues (e.g., Easterling’s right to progressive discipline before nonrenewal) also could not be brought to arbitration, since the nonrenewal was necessarily implicated in those claims. b. Kitsap Cnty. v. Kitsap Cnty. Corr. Officers’ Guild, Inc., 179 Wn. App. 987, 320 P.3d 70 (2014). Correctional officers and their union sought a declaratory judgment stating that layoffs were a mandatory subject for their collective bargaining agreement with the county. The county argued that the union had waived its right to bargain in a previous agreement, but the court found that that agreement had expired two years earlier and no longer controlled the relationship between the parties. The county next claimed that the union had waived its bargaining rights because it had previously allowed layoffs without attempting to bargain, but it failed to carry its burden of proof that the union had unmistakably waived its bargaining rights. The case was remanded so that the trial court could apply the balancing test to determine whether layoffs were a mandatory or permissive bargaining subject. 7. Unemployment compensation: Kirby v. State Dep’t of Emp’t Sec., 179 Wn. App. 834, 320 P.3d 123 (2014). Dorothy Thomas worked for a private security company in a nonunion position. She was assigned to a position at a UPS warehouse, where her job duties included keeping daily logs of any dangerous or suspicious behavior at the facility. The logs were then turned in to her supervisor’s office at the worksite. While at work, Thomas heard some UPS workers bragging about criminal activity and stealing headphones from the warehouse. She reported the matter to her supervisor, who told her not to write anything up unless she observed a theft in person. Thomas then called UPS’s 800 phone number to report the thefts; shortly after, she was called into a private meeting and instructed to write another incident report. Thomas refused, saying that she was concerned she would be fired and wanted an attorney present. She was then fired for insubordination. Her unemployment compensation was denied because the Department of Employment Security determined that she had been fired for “work misconduct.” The court determined that when she refused to prepare the report, Thomas had been acting out of fear and confusion, not a desire to willfully disregard her employer’s wishes. Viewed in context, the request for Thomas to write a report on the spot was not reasonable, and the court affirmed the ALJ’s decision that Thomas was eligible for unemployment compensation. 8. Frank Coluccio Constr. Co. v. Wash. State Dep’t of Labor and Industries, 181 Wn. App. 25, 329 P.3d 91 (2014). The Department of Labor and Industries (the “Department”) cited the employer, a construction company, for operating an excavator under trolley lines that were high voltage. A Department safety officer observed the site and noticed that the work was not being performed within the requirement in the regulation. The company stopped excavating to apply for a variance to the rules, which was granted. The Department, however, still issued a citation to the company for initially violating the regulation. The citation was affirmed by an industrial appeals judge despite the company’s appeal and argument that it was not feasible to comply with the rule at that project. The Board of Industrial Insurance Appeals adopted the decision of the industrial

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appeals judge, which was affirmed by and essentially adopted by the superior court judge and the court of appeals. B. Legislation: Washington 2014 session/Seattle ordinances. 1. Seattle minimum-wage law. On June 3, 2014, the Seattle City Council passed Ordinance 124490, which aims to raise Seattle’s minimum wage to $15 per hour. The phase-in period for the higher minimum wage varies by the size of the business. Businesses with 500 or more employees nationwide (including franchises) that do not provide health benefits will pay their employees $11 per hour starting in April 2015, $13 per hour starting in January 2016, and the full $15 per hour starting in January 2017; if these large businesses do offer health benefits, their minimum-wage increases will be staggered over an extra year. Businesses with fewer than 500 employees have through 2021 to raise their minimum wage to $15, but their hourly minimum compensation (wages paid to employees, plus the value of employees’ tips and medical benefits) must reach $15 per hour by 2019. 2. Seattle’s ban-the-box ordinance. This ordinance was passed in 2013 and was covered in last year’s materials. Employees and job applicants who work 50 percent or more of their hours within the Seattle city limits are protected by the ordinance, which prohibits employers from categorically rejecting job applicants with arrest or conviction records. Employers whose job duties include unsupervised access to children or security services are excluded. Employers may still request criminal- history information, but with the following restrictions:  Employers are required to first eliminate all otherwise unqualified candidates before considering criminal-history information.  When the employer does consider criminal-history information and it is the sole reason for an adverse employment action, then the employer must provide a legitimate business reason for its decision.  If the employer intends to base a decision solely on the criminal-history information, then it must give the employee or applicant notice, identify the records on which it is relying, give that person a reasonable

• pportunity to correct or explain the information, and hold the position
• pen for at least two business days after giving notice.

3. Amendments to whistleblower rules. The Human Rights Commission (the “HRC”) reviews and investigates whistleblower claims. Under the new regulations, the HRC must notify the person who brought the complaint that an investigation has been completed. The HRC must, within 90 days of notification that the investigation has been completed, issue written findings of fact and a finding that there is or is not reasonable cause for believing that an unfair practice has been or is being

• committed. The HRC must also notify the complainant’s union, if applicable. If the HRC finds

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reasonable cause to believe an unfair practice has been or is being committed, the HRC has six months to reach an agreement for the elimination of the unfair practice. If no agreement is reached, the HRC must make a written finding to that effect and provide it to the complainant, the complainant’s labor union, and the employer. The HRC has discretion to grant additional time to seek agreement. RCW 49.60; SSB 6046. 4. Involuntary servitude. A person commits involuntary servitude, a class C felony, by withholding or threatening to withhold or destroy documents relating to a person’s immigration status or threatening to notify law enforcement officials that a person is present in the United States in violation of federal immigration laws, regardless of whether the person provides any sort of compensation or benefits to the person who is coerced. Coercion does not include reports to law enforcement that a person is present in the United States in violation of federal immigration laws. RCW 9A.40; SSB 6339. 5. Minimum wage going up in 2015. Minimum wage in Washington will increase from $9.32 to $9.47 on January 1, 2015. III. FEDERAL OPINIONS. A. Ninth Circuit: meal and rest break laws: Dilts v. Penske Logistics, LLC,

• No. 12-55705, __ F.3d __ (9th Cir. July 9, 2014).

The Ninth Circuit held that federal laws regulating motor carriers do not preempt California law entitling workers to meal and rest breaks. Dilts, representing a class of similarly situated employees, was a driver for Penske Logistics and alleged that Penske failed to ensure that employees took their mandated breaks and created a management environment where employees were discouraged from taking breaks to eat and rest. Penske argued that the California law requiring meal and rest breaks was preempted by the Federal Aviation Administration Authorization Act (the “FAAAA”), which preempted state laws related to “price, route, or service” of any motor carrier. The Ninth Circuit held that the state law requiring breaks did not apply specifically to motor carriers but instead was intended to protect all workers, likening it to laws governing speed limits and wages that motor carriers still had to follow. Since the state law was intended to be generally applicable, and complying with it was unlikely to affect Penske’s prices, routes, or services, the court found that the California law was not preempted by the FAAAA. B. Ninth Circuit: FMLA: Escriba v. Foster Poultry Farms, Inc., 743 F.3d 1236 (9th Cir. 2014). Plaintiff, Escriba, a processor at one of defendant Foster’s plants in California, had her employment terminated when she failed to appear for work for three days without providing notice to Foster. Escriba had taken time off to visit her sick father in Ecuador, but told multiple supervisors at Foster that she was seeking vacation time, not leave under the FMLA,

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before leaving work. When Escriba overstayed her requested vacation time, she was fired. Escriba then sued Foster for interference with her rights under the FMLA. The Ninth Circuit held that Foster had not interfered with Escriba’s FMLA rights. The court found that Escriba had been fully informed of the protections of the FMLA but had chosen not to avail herself of the guaranteed leave. Employees are not required to mention the FMLA to succeed under an FMLA interference claim. Rather, the onus is on employers to determine whether an employee seeking time off would like to take FMLA leave. In this case, Foster employees repeatedly asked Escriba whether she wanted to use FMLA leave to cover her absence from work; in each instance, Escriba replied that she wanted to use vacation leave only. Although her absence would have been covered by FMLA had she chosen to invoke it, Escriba’s conscious, repeated refusal to use FMLA leave barred her from alleging FMLA interference after her employment was terminated. C. Ninth Circuit: Title VI: Rashdan v. Geissberger, No. 12-16305, __ F.3d __ (9th Cir. Aug. 26, 2014). The Ninth Circuit applied the McDonnell Douglas burden-shifting framework for Title VII disparate-treatment claims to a Title VI disparate-treatment claim. Plaintiff, an Egyptian dentist enrolled in an American dental certification program for international students, alleged that she had been discriminated against because of her national origin because she was not permitted to graduate after failing to perform a crown procedure and the head of the faculty called the student’s work “Third World Dentistry.” The trial court granted the university and individual defendants’ motions for summary judgment and the Ninth Circuit affirmed, holding that the comment had referred to plaintiff’s work and not her national origin, that no one affiliated with the university had made any disparaging comment related to Egypt, and that plaintiff had failed to establish that she was treated differently from similarly situated students. D. Ninth Circuit: ADA: Weaving v. City of Hillsboro, No. 12-35726, __ F.3d __ (9th Cir. Aug. 15, 2014). Plaintiff police officer brought claims under the Americans With Disabilities Act (the “ADA”), claiming that he had been discharged because of his disability related to his attention deficit hyperactivity disorder (“ADHD”). The city, his employer, claimed that his employment had been terminated because of his recurring interpersonal problems. A jury returned a verdict for plaintiff, finding that he was disabled and that defendant had terminated his employment because of his disability. The court denied the employer’s motion for judgment as a matter of law and for a new trial because of improper jury instructions; the city appealed. The Ninth Circuit reversed, holding that the jury could not have found as a matter of law that plaintiff’s ADHD substantially limited his ability to work with others under the ADA because he had normal social interactions and there was strong evidence that plaintiff had technical competence as a police officer.

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E. Ninth Circuit: Independent contractors: Slayman v. FedEx Ground Package Sys., Inc., No. 12-35525, __ F.3d __ (9th Cir. Aug. 27, 2014); Alexander v. FedEx Ground Package Sys., Inc., No. 12-17458, __ F.3d __ (9th Cir. Aug. 27, 2014). Similar class-action cases were filed in the majority of states against FedEx for allegedly illegal deductions for wages and unpaid overtime resulting from classifying FedEx drivers as independent contractors. These cases were consolidated for multidistrict litigation (“MDL”) in which classes were certified under various state laws. In Alexander (certified under California law), the Ninth Circuit reversed the MDL court’s summary judgment ruling that the drivers were independent contractors and instead granted summary judgment in favor of plaintiffs, ruling that the drivers had been improperly classified as independent contractors because FedEx had the right to control its drivers in that FedEx controlled the appearance of its drivers and their vehicles, the drivers’ schedules, and how and when drivers delivered packages, among other reasons. Similarly, the Ninth Circuit in Slayman (certified under Oregon law) reversed the MDL court’s grant of summary judgment to FedEx and denial of plaintiffs’ motion for partial summary judgment, holding that the drivers were employees under Oregon’s right-to-control test for illegal deductions and Oregon’s economic-realities test for unpaid overtime. F. Ninth Circuit: FLSA/overtime: Haro v. City of Los Angeles, 745 F.3d 1249 (9th Cir. 2014). Fire department technicians and dispatchers filed FLSA claims for overtime because they had been classified as exempt for being “engaged in fire protection.” The Ninth Circuit affirmed the trial court’s rulings that the employees were not exempt and that the employer had acted willfully in erroneously classifying plaintiffs, and therefore the statute of limitations was extended, and the court awarded liquidated damages. The Ninth Circuit, joining the Sixth and Seventh Circuits, affirmed that offsets for previously paid overtime are applied on a week-by-week basis. G. Ninth Circuit: Retaliation/FLSA: Avila v. Los Angeles Police Dep’t,

• No. 12-55931, __ F.3d __ (9th Cir. July 10, 2014).

The Ninth Circuit upheld a ruling in favor of a police officer who alleged that his employment had been terminated in return for testifying in a FLSA lawsuit brought by a fellow

• fficer. The police department argued that plaintiff had been fired for refusing to account for his
• vertime work, and that a Board of Review decision upholding the termination of his

employment, which the plaintiff did not challenge, precluded the suit at hand. The court found that the BOR decision lacked preclusive power because it addressed only plaintiff’s alleged insubordination, not the reason for his firing or his allegations of retaliation. Therefore, there was no issue preclusion because the BOR decision had failed to adequately explain the motive for the termination of plaintiff’s employment.

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H. Supreme Court: FLSA: Sandifer v. U.S. Steel Corp., __ U.S. __, 134 S. Ct. 870 (2014). Steelworkers brought FLSA claims against their employer alleging that they had not been compensated for the time spent putting on and taking off (“donning and doffing”) protective gear. The Supreme Court held that time spent donning and doffing the majority of their protective gear was time spent “changing clothes” under the FLSA and was therefore a permitted subject of any collective bargaining agreement. I. Supreme Court: Affordable Care Act: Burwell v. Hobby Lobby Stores, Inc., __ U.S. __, 134 S. Ct. 2751 (2014). For-profit closely held corporations brought claims against the Secretary of Health and Human Services and other government agencies, seeking declaratory and injunctive relief under the Affordable Care Act (the “ACA”), claiming that the ACA’s mandate for preventive services (including contraceptives and related counseling) violated religious freedom. The Supreme Court, in a 5-4 decision, held that the ACA contraceptives mandate as applied to for-profit closely held corporations substantially burdened the exercise of religion under the Religious Freedom Restoration Act because it did not satisfy the least-restrictive-means test under the act. J. Supreme Court: Sarbanes-Oxley whistleblower: Lawson v. FMR LLC, __ U.S. __, 134 S. Ct. 1158 (2014). The Supreme Court held that whistleblower protections under the Sarbanes-Oxley Act extended to employees of private contractors and subcontractors serving public companies. Plaintiffs, employees of private companies that contract to advise or manage mutual funds, brought claims against their employers.

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