California Employment Law Update

Category Archives: Exempt Employees

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Foreign National Who Worked For Travel Tour Company Was An Employee, Not An Intern Or Exempt Manager

Kao v. Joy Holiday, 2017 WL 2590653 (Cal. Ct. App. 2017) Ming-Hsiang Kao was employed by Joy Holiday (a travel tour company) initially performing IT-related duties and then eventually as its office manager. While he was still in Taiwan, Kao worked with Jessy Lin (one of the owners of Joy Holiday) as a tour organizer. … Continue Reading

Safeway/Vons Assistant Managers Were Properly Classified As Exempt From Overtime

Batze v. Safeway, Inc., 10 Cal. App. 5th 440 (2017) Gary Batze, et al., brought this lawsuit against their employer Safeway/Vons for failure to pay overtime wages. The employees alleged that they worked non-managerial tasks that rendered them non-exempt employees. After weeks of trial testimony, the trial court determined that the employees were engaged for … Continue Reading

Auto Dealership Service Advisors Are Not Exempt From Federal Overtime Requirements

Navarro v. Encino Motorcars, LLC, 845 F.3d 925 (9th Cir. 2017) An amendment to the Fair Labor Standards Act (“FLSA”) exempts from its overtime requirements “any salesman, partsman, or mechanic primarily engaged in selling or servicing automobiles, trucks, or farm implements.”  The U.S. Department of Labor (“DOL”) subsequently issued an opinion letter and amended its … Continue Reading

Del Mar Fairgrounds/Horsepark Employees Are Exempt From Overtime Under The Amusement Exemption

Morales v. 22nd Dist. Agricultural Ass’n, 1 Cal. App. 5th 504 (2016) Jose Luis Morales and 177 other similarly situated plaintiffs sued their employer under Cal. Labor Code § 510 and the federal Fair Labor Standards Act (“FLSA”) for failure to pay them overtime. Plaintiffs’ employer is a California agency that owns and manages the … Continue Reading

Ninth Circuit Strikes Down Employer’s Class Action Waiver

Morris v. Ernst & Young, LLP, 2016 WL 4433080 (9th Cir. 2016) As a condition of employment, Stephen Morris and Kelly McDaniel were required to sign agreements not to join with other employees in bringing legal claims via arbitration against their employer. Morris and McDaniel filed a class and collective action against the company, alleging … Continue Reading

Auto Dealership Service Advisors May Be Exempt From Federal Overtime Requirements

Encino Motorcars, LLC v. Navarro, 579 U.S. ___, 2016 WL 3369424 (2016) An amendment to the Fair Labor Standards Act (“FLSA”) exempts from its overtime requirements “any salesman, partsman, or mechanic primarily engaged in selling or servicing automobiles, trucks, or farm implements.” Later, the U.S. Department of Labor (“DOL”) issued an opinion letter and amended … Continue Reading

California Raises Minimum Wage to $15 Per Hour and Increases Minimum Salary for Exempt Employees

On April 4, 2016, Governor Brown signed Senate Bill 3, which will increase California’s minimum wage annually, reaching $15 per hour for employers with at least 26 employees by January 1, 2022.  This bill enacts the highest statewide minimum wage in the nation, on par with New York, which enacted a bill mandating a $15 … Continue Reading

Trial Court Should Have Certified Class Claims Of Managerial Employees

Martinez v. Joe’s Crab Shack Holdings, 231 Cal. App. 4th 362 (2014) Roberto Martinez and three other current or former employees of Joe’s Crab Shack (“JCS”) filed this putative class action asserting that they and similarly situated salaried managerial employees had been misclassified as exempt employees and were entitled to unpaid overtime and related wages. … Continue Reading

Class Action Plaintiffs Must Develop A Trial Plan That May Include Statistical Sampling

Duran v. U.S. Bank Nat’l Ass’n, 59 Cal. 4th 1 (2014) Plaintiffs in this case are loan officers for U.S. Bank (“USB”) who claim they were misclassified as exempt employees under the outside salesperson exemption. After certifying a class of 260 plaintiffs, the trial court devised a plan to determine the extent of USB’s liability … Continue Reading

California Courts May No Longer Be Able to Certify a Ham Sandwich

Commentators have quipped that class certification is so easy in California that with little effort a group of plaintiffs could certify even a ham sandwich.  In fact, as we have discussed here, we have seen a proliferation of recent appellate decisions hinging class certification on the mere existence of an employer’s uniform policy – no … Continue Reading

Insurance Claims Adjusters Are Not Exempt Administrative Employees

Harris v. Superior Court, 207 Cal. App. 4th 1225 (2012) Plaintiffs in this case are insurance claims adjusters who claim they were misclassified as exempt from overtime under the administrative exemption. The Court of Appeal held that because the adjusters’ primary work duties are the day-to-day tasks of adjusting individual claims and are not directly … Continue Reading

Court of Appeal Rejects “Trial by Formula,” Reverses Multimillion Dollar Verdict and Orders Class Decertified

Duran v. U.S. Bank Nat’l Ass’n, No. A125557, 2012 WL 366590 (Feb. 6, 2012) In a decision destined to have significant statewide ramifications, the California Court of Appeal for the First District reversed a trial court’s certification of a wage-hour class and determination of liability, concluding that the trial court had failed to follow “established … Continue Reading

Employer Was Deprived Of Due Process By Trial Court’s Erroneous Use Of Representative Sampling

Duran v. U.S. Bank Nat’l Ass’n, 203 Cal. App. 4th 212 (2012) U.S. Bank (“USB”) appealed a $15 million judgment that was entered against it following a bifurcated bench trial. The plaintiffs are 260 current and former business banking officers who claimed they were misclassified by USB as outside sales personnel exempt from overtime pay. … Continue Reading

Insurance Claims Adjusters May Be Exempt Administrative Employees

Harris v. Superior Court, 53 Cal.4th 170 (2011) Plaintiffs in this case are claims adjusters employed by two insurance companies. They filed four putative class actions, claiming they had been erroneously classified as exempt administrative employees and seeking damages based upon unpaid overtime. The court of appeal held as a matter of law that plaintiffs … Continue Reading

Hourly Rates For Certain Computer Software Employees, Licensed Physicians Increase; San Francisco Minimum Wage Rises To $10.24 Per Hour In 2012

California Labor Code § 515.5 exempts computer software professionals from the overtime pay requirements imposed by Labor Code § 510, provided they meet certain requirements. To qualify as exempt, these professionals must perform the functions enumerated in the statute and receive a minimum hourly rate of pay. The California Department of Labor Standards Enforcement (“DLSE”) has announced … Continue Reading

Social Workers May Not Be “Learned Professionals” Who Are Exempt From The FLSA

Solis v. State of Washington, 656 F.3d 1079 (9th Cir. 2011) The U.S. Secretary of Labor filed a complaint against the State of Washington’s Department of Social and Health Services (“DSHS”), alleging a violation of the Fair Labor Standards Act of 1938 (“FLSA”) based upon the DSHS’s classification of its social workers as “learned professionals” … Continue Reading

Unlicensed Law Clerk Was Properly Classified as Exempt Professional

Zelasko-Barrett v. Brayton-Purcell, LLP, 198 Cal. App. 4th 582 (2011) Following his graduation from law school but before he had passed the California bar examination, Matthew Zelasko-Barrett worked for the law firm of Brayton-Purcell, LLP as a Law Clerk II. After his voluntary departure from the firm, Zelasko-Barrett filed this lawsuit claiming he was misclassified … Continue Reading

Unlicensed Junior Accountants May Be Exempt From Overtime

Campbell v. PricewaterhouseCoopers, 642 F.3d 820 (2011) Two thousand unlicensed junior accountants brought this wage-and-hour class action against PwC, alleging they were improperly classified as exempt from overtime. The parties filed cross-motions for partial summary judgment, and the district court granted the employees’ motion, holding as a matter of law that they were not exempt … Continue Reading

Class Of 1.5 Million Female Wal-Mart Employees Was Improperly Certified

Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (2011) The United States Supreme Court held that this class of as many as 1.5 million current and former female Wal-Mart employees was improperly certified by the lower court. The three lead plaintiffs claimed they were discriminated against on the basis of their gender and that … Continue Reading

Appeals Court Clarifies Scope of Commissioned Salesperson Exemption

In a case possibly signaling a new direction in California wage and hour law, a California appellate court ruled Friday that a class of car dealers fell within the commissioned salesperson exemption to California overtime laws despite receiving flat fee commissions instead of commissions calculated as a percentage of the price of the cars sold.… Continue Reading

Class Certification Was Properly Denied To Retail Store Managers

Mora v. Big Lots Stores, Inc., 194 Cal. App. 4th 496 (2011) Putative class representatives Ana Mora, et al., asserted claims for unpaid overtime, meal and rest periods and related wage-and-hour violations against their former employer Big Lots Stores, Inc. and its affiliate PNS Stores, Inc. Plaintiffs asserted that they and similarly situated Big Lots … Continue Reading

Pharmaceutical Sales Reps Were Properly Classified As Exempt Outside Sales Employees

Christopher v. SmithKline Beecham Corp., 635 F.3d 383 (2011) Michael Christopher and Frank Buchanan were employed as pharmaceutical sales representatives (“PSRs”) of SmithKline d/b/a GlaxoSmithKline (“Glaxo”) and were classified as outside salesmen exempt from the Fair Labor Standards Act. PSRs work outside of a Glaxo office and spend much of their time traveling to the … Continue Reading
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