labor lawAdivision of labor law center

The California Labor Agency recently issued an opinion allowing employers to reduce an exempt employee’s salary and hours worked, at the same time, without endangering the worker’s status as a salaried exempt employee.

In the example used, the state labor agency permitted an employer faced with economic difficulties to reduce the work schedule of exempt employees from five days to four days. The state DLSE or Department of Labor Standards Enforcement ruled in a recent opinion letter that simultaneously reducing the employee’s salary by 20%  “did not violate the ‘salary basis’ for the workers’ overtime exemption under the state Labor code and wage orders” as long as the employer’s action is a temporary measure.

This is a radical change, since the DLSE took the opposite position in 2002. In an opinion letter issued in that year, the California agency ruled that the employer could reduce an employee’s salary. However, if the employee’s work hours were also reduced, that change the employee from exempt to non-exempt status.

This is a primary concern for California employers, since non-exempt employees are entitled to overtime under state law. California has the strictest (more…)

Nationwide employers should note that both federal and state courts in California will now throw out almost all noncompetition agreements. California has one of the most restrictive laws regarding noncompetition agreements. In fact, such agreements are almost always unenforceable in the state.

California law specifically requires that every individual shall retain the right to pursue any lawful employment opportunity.

Recently, Edwards v. Arthur Andersen upheld that principle. A tax manager for Arthur Anderson LLP in Los Angeles, Raymond Edwards signed a noncompete agreement in 1997.

The agreement specifically noted that  Edwards would not work directly for any of his Arthur Anderson clients, for 18 months after his separation from Arthur Anderson.

After the Enron debacle, Arthur Anderson closed its Los Angeles office and laid Edwards off. Another company offered Edwards a job, but only (more…)

Employers who neglect to pay court-ordered restitution face hefty fines and penalties under both California and federal law.

In a recent California case involving Southern California Cleaning Service, a federal judge ordered the company to pay an additional penalty of $2,400 per day, for each day that the payment is delayed.

Even worse, the court also found the two owners of the company in contempt, and ordered them each to pay an additional $200 per day penalty. Further violations could result in them being jailed for contempt of court.

Both the fines will continue on a daily basis until the employees are paid in full.

In addition, the company was ordered to pay $227,701 in interest – 4.4% — on unpaid back wages of almost $3.5 million, plus $1 million in liquidated damages to workers.

The company’s troubles began in 2007 when the U.S. Department of Labor won a lawsuit against the southern California employer.

The judge in that case determined that Southern California Maid Services and Carpet Cleaning had improperly classified nearly every employee (more…)

With the current economic crisis, many employers are considering giving workers additional unpaid time off during the holidays. This includes giving workers Friday, November 28 (the day after Thanksgiving) and/or Friday, December 26 (the day after Christmas) off without pay.

Other employers are considering closing for an entire week between Christmas and New Years.

However, these tactics raise issues around the payment of exempt salaried employees that every employer needs to be aware of. (more…)

Parents in California are furious at the local school district – but school board officials insist they were merely following federal HIPAA regulations.

Surprised parents in Vacaville were caught off guard when their youngsters reported that last year’s female music teacher was now a “mister.” The teacher is undergoing transgender surgery, and reported to Foxboro Elementary school as a man at the beginning of the school year.

Angry taxpayers lodged complaints (more…)