Storm's California Employment Law

Is California "anti-business"?

You've heard a lot about California being "anti-business" and its laws and policies being hostile to employers. It's an article of faith among some of my colleagues. Apparently, ho

• California does in fact lose business and jobs because of relocation, but the effect on employment is negligible. In any year from 1993 to 2002, the net job loss from business relocation was never higher than one-tenth of 1 percent of the total number of jobs. . .
• Employment change is primarily driven not by interstate relocation but by the expansion and contraction of existing businesses and by the births of new businesses and the deaths of existing ones. . .
• When they do move, businesses are much more likely to move locally than across state boundaires. . .

Also, not this interesting factoid: "Those who have argued that California's business climate has pushed businesses out of California have rarely relied in empirical evidence of relocation behavior, but rather or surveys that elicited subjective assessments from employers."

In other words, someone is creating a positive-feedback loop that is scaring the crap out of medium and small businesses in the state, driven by a justifiable frustration at complicated regulation. Nonetheless, fear-mongering at the state of things in the world's fifth largest economy is not productive. One wonders whether the rust-belt states are claiming the same problems as they lose population in droves to the sun-belt. California is a great place to do business, especially relative to where else you can go, even if sub-optimal in all aspects.

You can read the entire report here in the California Economic Policy Journal.

More on Wal-Mart

More on Wal-Mart.

Nathan Newman bombards Kevin Drum and Ezra Klein for widening the context of the Wal-Mart dispute.

Employers shouldn't be excused for completely rotten, immoral activities just because a better policy would make compliance with the law easier. This is bleeding heart liberalism applied to the largest corporation on earth, as if Ezra is excusing some kid caught purse snatching with the excuse that society had failed to provide better economic alternatives to a life of crime, so it's really society's fault that the victims lost their property.

I've talked to people about this, and it's not clear what they are (were going to be?) doing is discriminatory. Even if it discourages "unhealthy" applicants (not a protected class as long as they aren't perceived as such), as long as they aren't trying to keep disabled people out, it's not illegal. Under disparate impact cases, there is a so-called "interest" defense (why you don't see WASPs bring class actions against strawberry farms). If it's just that people don't want that kind of job, it's basically ok. It depends on the intent.

And Newman may be right that allowing this potential violation in order to cure a health care issue isn't the law, but at least they aren't simply doing it to pad their pockets. Pure motive or not, they are trying to address an important social issue. That should be deemed a step in the right direction for a Wal-Mart antagonista.

Gattuso v. Harte-Hanks Shoppers, Inc.

The Second District has held that Labor Code section 2802 does not preclude employers from paying increased salaries or commissions in lieu of reimbursement for actual expenses.

The Wal-Mart Memo: Does It Break The Law?

Wal-Mart has managed to create another PR nightmare for itself. This week, an internal memo (p.14) suggesting that Wal-Mart discourage unhealthy people from applying for jobs has raised hackles from the usual anti-Wal-Mart suspects. But it might also raise a lawsuit.

If you're reading this blawg, you're probably aware that the ADA and (in California) the FEHA prevent discriminatory hiring practices against those with disabilities.

Nothing in the memo suggests that this is anything but a proposal, and it probably wasn't vetted by the company's lawyers. Even still, nothing in it is per se discriminatory. Instead of trying to exclude the disabled, instead it's trying to attract health-conscious workers.

I'm not an ADA jock. I don't know enough to say for certain whether or not this all on its own violates the ADA, but my sense is that it doesn't, and, if it does, it's bad policy. Given the bovine nature of America, the country's largest employer should do something to encourage more physical activity!

The SEIU's spokesperson told the WSJ (sub. req'd) that

"When you add physical requirements to jobs that don't need them, you begin to weed out a whole pool of people such as the elderly, the obese, people with pre-existing medical conditions," says Andrew Stern, president of the Service Employees International Union, which represents 1.8 million workers, including health-care workers, janitors and security guards. "I think this memo steps over the line of what's legal," he adds.

There is an argument that they might be unnecessarily adding tasks to job descriptions. Here's where I'd ask for some reader feedback. To what extend does the FEHA or ADA mandate than an employer create job descriptions? Can the ADA stop Wal-Mart from making cashiers collect carts? If so, what else can't they do? Do employer have to create job descriptions that are always carefully calibrated according to potential disability impact?

2005 Legislative Summary [Draft]

Only a few employment-related bills made it through the legislative process this year. This is mostly a reflection of the split government. Remember, to an outside observer, California politics is polarized on a coprorate/union axis with other interest groups not holding nearly as much sway.

AB 1093 allows for final "termination pay" to be made by direct deposit to a bank with a location in California, even if not headquartered here. It also clarifies some aspects of a computer programmer's exemption from overtime rules. Nothing too big here.

AB 1311 harmonizes service rules between DLSE hearings and civil suits. No biggie either.

SB 101 is discussed below--only put the last 4 digits of a social on a pay stub!

Sb 184 ups a talent agencies bond requirement to $50,000. Hmph.

The gridlock in Sacramento has succeeded in doing one thing: limiting the amount of topics for people like me to speak about to potential clients in the spring. There really isn't that much change in the law this year. I think that's a good thing--so we can let all of the rapid change in the past few years sink in.

2005 -- that's a wrap. I'll keep my ears open for a veto overried on minimum wages, but otherwise, 2005 legislative updates are done.

UPDATE: Littler's summary is here.

Legislative Update

AB 48 was VETOED. AB 57 was VETOED. AB 169 was VETOED. AB 222 did not pass in committee. AB 364 did not pass in committee. AB 391 was VETOED. AB 419 died in committee. AB 474 did not pass in committee. AB 510 did not pass in committee. AB 553 did not pass in committee. AB 640 did not pass in committee. AB 673 died in committee. AB 674 died in committee. AB 775 died in Senate committee. AB 822 died in committee. AB 875 was VETOED. AB 879 was VETOED. AB 904 did not pass in committee. AB 985 was VETOED. AB 1012 died in committee. AB 1093 passed and is law. AB 1255 died in the hopper. AB 1311 passed and is law. AB 1626 has been transformed to a non-employment issue. AB 1709 did not pass in committee. SB 101 passed and is law. SB 174 was VETOED. SB 184 passed and is law. SB 285 died in committee. SB 862 died in commitee. SB 940 was VETOED.

That's a wrap for 2005. Arnold terminated all but a few bills, which I will review above.

Some Initial Thoughts On The Jury System

My experience as a juror was traumatic. Not because the seats in the jury box must have been designed by a cabal of chiropractors to maximize business; not because it took two weeks of my life; and not because most of the subject matter was drop-dead boring.

It was traumatic because during deliberations, roughly half of my fellow jurors simply ignored the evidence and the instructions. And it's not because I disagreed with the result that we arrived at. I simply disagreed with the disdainful, prejudicial manner that some of the other jurors had.

I pray that I never have my fate or the fate of someone I care about decided by such a group. I don't have any proof, for example, that some of those who refused to deliberate in good faith were simply trying to get home after two long weeks, but I got it straight from the horse's mouth from some of them that they simply "didn't like" the plaintiff or thought that because he didn't do absolutely everything perfectly that he deserved no reward--nothing that had anything to do with the law or the facts.

The case deserved a defense verdict, in my opinion, but not because the of the smear on the plaintiff by the defense, not because there are "frivolous" lawsuits out there and we should punish the system (there was enough juice in this one on day one to leave any notion of frivolous far behind), or anything else that was irrelevant to the events in question.

As a defense attorney, I have to feel emboldened. As a citizen, I have to be scared.

A lawyer as a juror.

I have been on a jury for almost two weeks now. It's been an educational process that I will have a lot to say about once I'm relieved of my duty to hush up. I apologize for the lack of posts. As you can imagine, I've been occupied.

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