Obama Administration Bends Individual Mandate Rules

With the deadline to select health coverage just days away, the Obama administration has given an early Christmas present to individuals whose policies were cancelled because of the Affordable Care Act (“ACA”).

Those individuals will be temporarily “exempted” from the ACA’s individual mandate, according to a bulletin issued late Thursday from the Department of Health and Human Services. The rule change was spearheaded by a group of Democratic senators, many of whom face tough re-elections battles next year. More ›

Second Circuit: Parent Company has Liability for Subsidiary’s WARN Violations

The Worker Adjustment Retraining and Notification Act ("WARN") requires employers with 100 or more employees to provide 60 calendar days' notice of plant closings or mass layoffs to give transition time to workers and their families to adjust to the prospective loss of employment, seek alternative jobs, and/or enter skill training or retraining to successfully compete in the job market. 29 U.S.C. §2201 et seq. Employers who fail to comply with WARN are liable to affected employees for up to 60 days of pay and benefits. 29 U.S.C. §2104(a)(1).

In this case, the employee was laid off by the employer and filed a class action alleging that the employer and its parent company and other related ownership entities violated WARN. Specifically, the employee claimed that the parent was liable for the employer's WARN violations because the parent company disregarded the employer's corporate form and exercised de facto control of the employer. As it turns out, the parent company was the sole member and manager of the employer, and the parent company's board operated as the employer's board.

The Second Circuit reversed summary judgment in favor of the parent company, finding that a triable issue of fact existed that would allow a jury to conclude that the employer was so controlled by the parent that the employer lacked the ability to make any decisions independently and that a parent company resolution authorizing the employer to layoff this employee and the class of similar employees was a function of being an employer and created liability. Adopting Department of Labor regulations to determine if separate entities are a single employer, the court considered whether there was (1) common ownership; (2) common directors and/or officers; (3) de facto exercise of control; (4) unity of personnel policies emanating from a common source; and (5) dependency of operations. The Second Circuit observed that the inquiry is a fact-specific balancing test, no one factor controls, and all factors need to be present for liability to attach to the related entity. Significantly, a separate legal existence will not insulate a parent company from liability for a subsidiary's WARN violations if the parent is the decision-maker responsible for the employment practice giving rise to the litigation.

If you have questions about Guippone v. BH S&B Holdings, LLC et al., No. 12-183 (2^nd Cir. December 10, 2013), please contact David I. Dalby.

California Restaurant Managers get Second Chance at Class Action

In Martinez v. Joe’s Crab Shack Holdings, the California Court of Appeal for the Second Appellate District reversed an order denying class certification to a group of managerial restaurant employees allegedly misclassified as exempt.

The case was brought by lower-level managers at Joe’s Crab Shack restaurants throughout California who complained that they performed many of the same tasks as hourly employees but did not qualify for overtime pay due to their managerial status. More ›

California Restaurant Managers get Second Chance at Class Action

In Horne v. International Union of Painters and Allied Trades District Counsel, 16, Plaintiff Raymond Horne, an African American male, applied for organizer positions within the union of which he was a member on two occasions.  Defendant union hired white males in each case, and Horne sued the union, alleging that he had not been hired due to racial discrimination, in violation of Government Code section 12940, subd. (a) of the Fair Employment and Housing Act (“FEHA”). More ›

NLRB: Unions can Picket on Private Walkways in California

After a grocery store opened a warehouse grocery store under a different name in Sacramento, California, the store became a target for union picketing. The United Food and Commercial Workers Union Local 8 began picketing the store because the workers were not represented by a union and did not have a collective bargaining agreement. The Union agents held signs and distributed fliers in front of the store’s entrance and walkways, but did not impede customer access to the store. The grocery store contacted the Sacramento Police Department to remove the Union agents, but the police declined to do so without a court order. More ›

Employee Witness Entitled to Same Protections against Retaliation as Complaining Employee

In this case, the Eighth Circuit Court of Appeals holds that not only is an employee who complains about inappropriate conduct in the workplace protected from retaliation, but the same protections extend to those employees who participate in an investigation into the alleged conduct. More ›

Sixth Circuit: No Gender Bias in Wage Difference between Male and Female Counterparts

In this case, the employee began working with the auto parts manufacturer when she was a student. After she graduated, she was hired as a test engineer with the same starting salary as the other engineering graduates. More ›

California Will Not Allow Health Insurers to Reinstate Coverage

More than a million California residents whose health plans were cancelled under the Affordable Care Act, a.k.a. Obamacare, will not be able to keep their existing coverage, despite President Obama’s directive that insurers keep such plans available for another year. More ›

Obamacare Chaos: Two Lessons for Employers

Dysfunctional websites. Low enrollment numbers. Public outrage over cancelled health policies. Mea cuplas. Presidential administrative “fix.”  Competing Congressional solutions. Finger pointing. It’s enough to make your head spin!

As an employer, you may be wondering what the recent flurry of activity surrounding the Affordable Care Act (a.k.a. Obamacare) means for your business. This post presents the two most important lessons that employers should keep in mind following last week’s events. More ›

“Familial Status” (Whatever That Means) may Become FEHA’s Newest Protected Category Under SB 404

California employers are well aware that legislators and regulators, both on the state and federal level, have been burning the candle at both ends to generate laws, regulations, and administrative actions designed to hedge in and restrict their ability to chose and terminate their employees.

Correspondingly, it comes as no surprise to learn that the list of protective classes under California’s Fair Employment and Housing Act (“FEHA”) — which prohibits employment discrimination — is about to expand once again. More ›