Category: Blog

At-What? Understanding At-Will Employment

You’ve probably seen the term, “at-will employment” in your hiring paperwork, your employee handbook, or on posters in the breakroom. But what does that mean? Can you really be fired for any reason at all?

The answer is yes…and no. At-Will status has been adopted by employers in every state except Montana, where employees are protected from termination without “good cause” after they pass their probationary period. For the rest of us, at-will employment means your employer can choose to terminate your employment at any time, for any reason or no reason at all. Even if your handbook does not state you are At-Will, the law typically assumes you are. Additionally, it does not have to be phrased exactly as “at-will”. Any terminology such as “can be fired at any time”, “with or without cause”, alludes to At-Will status. Unless you have a binding contract or other documentation stating that your employment cannot be terminated before a certain time period has passed, or that you can’t be fired without justifiable reason, it is presumed that you fall under at-will policy.

Finding this out can be disheartening for those in the workforce. The next question which typically follows is, “What are my rights?”

As an employee, you do have some rights which protect you from wrongful termination, or give you some recourse in the event that wrongful termination does occur. Employers may not terminate you as the result of discrimination against a protected class (your race, religion, gender, sexual orientation, age or disability), or in retaliation for making a complaint about discrimination or safety/illegal activity. Anything else is pretty much fair game.

It’s important to understand the difference between discrimination, and favoritism or a general “dislike”. For example, someone may say, “My boss allows my co-worker to take time off whenever she wants, but my one request for a day off was denied. Isn’t this discrimination?” It could be. You have to examine the reason she is treating you differently. Do you have good reason to believe she “doesn’t like you” because you are a different race from her? Because you openly practice a different religion than she does? Or does the resistance seem to stem from having different personality types? If the reason is the latter, or she “just doesn’t like you”, it most likely is not discrimination.

Whistleblowers are also protected, and should not be terminated after making a complaint internally or externally about potential safety hazards or suspected illegal activities. Wrongful termination by retaliation occurs when an employee makes a complaint to HR or upper management about perceived illegal activity, and is clearly let go as a direct result. Retaliation does not include making a complaint to HR about a “mean” boss, wanting a raise, or annoyances from a co-worker.

If you believe you have been discriminated or retaliated against, or have experienced wrongful termination under the conditions listed above, it would be in your best interest to contact one of our office immediately, so an attorney may review your case and advise you on your options at this point.

Are You Receiving At Least Minimum Wage in California?

New Minimum Wage Rate/Non-Exempt Employees:

On January 1st, 2016, California’s minimum wage per hour was raised from $9.00 per hour to $10.00 per hour. Although there are some exceptions, almost all employees in California must be paid the minimum wage as required by state law, this means that all non-exempt employees working in California are entitled to at least $10.00 per hour.

Some cities like San Francisco and Los Angeles (applicable to Orange County, CA), for example, have passed local city ordinances that command higher minimum wage to account for the higher cost of living in those areas. California employment law mandates that an employer must follow the minimum wage order that is most beneficial to the employee, that is, the highest minimum wage amount.  As a non-exempt employee, you are entitled to overtime compensation at the rate of one and one/half your hourly rate, (if you make $10.00 per hour, your overtime rate would be $15.00), for all hours worked in excess of eight hours  a day.

Interestingly, Federal Minimum wage is still $7.25 per hours, which translates to $15,080 for a full-time, year-round worker.  Federal minimum wage has not been raised since 2009.

What This Means To You If You Are Being Compensated With Tips Or Commission?

Tipped Employee:

An employer must still pay you a minimum of $10.00 per hour for all hours worked, before any tips. An employer may NOT use an employee’s tips as credit towards its requirement to pay you the minimum wage of $10.00 per hour. Essentially, you must be paid for all hours worked at the minimum wage rate, and tips earned are to be paid on top of the minimum wage. An employer cannot include your tips to show that you are making at least $10.00 per hour.

Employees Earning Commission:

California employment law requires that employees entering into employment agreements which involve compensation, even in part, on a “commission” basis must be provided a written contract which sets forth the method by which the commission is computed and paid.  Employers must provide the employee with a signed copy of the commission agreement and obtain a signed acknowledgment of receipt of the copy.

The agreement must include:

  1. First, the method of computing the commission must be described completely.  The employer must define the commissionable basis, whether the commission is based on revenue or a margin of revenue, profit, or another basis
  2. Second, the agreement must be clear as to when the commission is “earned,” so that the employee’s entitlement to commissions upon termination of employment is clear. For example, some employees may not “earn” their commission until after a certain event occurs, after an item is paid for and delivered to the customer, or after a certain time period, like after thirty days.
  3. Third, the agreement should explain how draws will be applied to commissions. For example, if the schedule for reconciliation or settlement of commissions is less frequent than the employee’s regular pay period, you may be required to pay a draw so that minimum compensation requirements are satisfied. If there is a formula for calculating the draw, it should be disclosed; otherwise, the amount of the draw, if fixed, should be specified.
  4. The agreement also should state the period for which commissions will be calculated (e.g., monthly), when draws are paid (e.g., weekly, semi-monthly, etc., if applicable), and when commissions will be reconciled and paid.
  5. An employee should make sure the employment contract is clear as to when commissions are paid in the event of termination of resignation.

Essentially, an employer will need to compensate for all hours worked at the minimum wage rate of $10.00 per hour on a regular basis, which is referred to as a “draw.” If your earned commission that is more than the minimum wage amount and/or draw amount, then the draw is covered and you will be paid any excess commission amounts. However, if your commissions do not cover the draw, then the employer cannot deduct your make you pay back the minimum wage amount.

Exempt Employees:

If you are an “exempt” employee as defined in California Wage Orders, then you can be “exempt” from being paid for overtime compensation, but you must earn a monthly salary equivalent to no less than two times the state minimum wage for full-time employment.”

This means when the minimum wage increases so will the minimum salary required for exemption. Beginning January 1, 2016 the new minimum salary required will be $41,600.   It is imperative to understand and remember that paying the minimum salary alone itself will not qualify a position for exempt status, there are also duties and time spent tests that must be met. In addition, all tests must be met in order to qualify for exempt status. This means if a company has positions that currently meet all the tests for exempt status but do not raise salaries to reflect the appropriate minimum salary required for exemption outlined previously those positions will revert to non-exempt status making them overtime eligible.

 

Please see http://www.dir.ca.gov/dlse/FAQ_MinimumWage.htm for more information and please contact Aegis Law at (949) 379-6250 with any questions!

Employment Law

Olsen Twins’ The Row, Gearing up for a Legal Row

Child stars turned producers turned fashion gurus won’t be turning into labor attorneys anytime soon. The Olson Twins have been served a class action lawsuit of forty current and previous interns for unpaid wages. The suit was filed in Manhattan Supreme Court and names Dualstar Entertainment, the umbrella company for the Olsen fashion labels, the Row and Elizabeth and James.

The interns allege they were unpaid, and while some interns received college or vocational credit, those who were not students did not. They worked over 50 hour week weeks, “running personal errands for paid employees, photocopying, sewing, making spreadsheets.” The head plaintiff, Shahista Lalani, alleges the working conditions were horrendous—she was even hospitalized for dehydration at one point while running errands in 100 degree weather and carrying excessive weight.

According to Lalani, the head technical designer was demanding and hostile. “I was doing the work of three interns. I was talking to her all day, all night. Emails at nighttime for the next day, like 10pm at night.” The class members allege that the interns were doing the same kind of work as paid, entry level employees, but the company used them as interns to skirt minimum wage laws.

Lalani worked for a five month period, “you’re like an employee, except you’re not getting paid.” While the plaintiff concedes that the Olsen Twins themselves were “never mean to anyone,” she alleges that Dualstar owes the interns at least minimum wage, back pay, and penalties.

manicurists

Manicurists Unite! The Truth About Your Nail Salon

It is a luxury for most women and a regular routine for many women (and men) to get their manicures and pedicures done. We pay the bill and tip the manicurists and go on with our day. However, what’s the real cost of those acrylics or that gel manicure?

In Little Saigon, members of the California Health Nail Salon Collaborative hosted a community forum for both workers and owners to listen and speak about the growing national spotlight on the treatment of manicurists in the industry. In the status quo, many owners don’t know what the proper regulations for business are; they merely follow the model and example that owners before them followed.

There are often no paper records for the manicurists working in salons; they are paid cash and work whatever hours the owners need them to—even if it’s after closing and they’ve hit all sorts of overtime hours. If the owner does have some sort of tax record for their manicurists, it’s usually a 1099. Salon workers are consistently misclassified as independent contractors though they are under the full control of the salon and are treated as employees.

Last year, average manicurists made $22,500. Often, these employees are working 60 hour work weeks, but not getting paid proper overtime rates of pay or meal/rest breaks. Representatives from the U.S. Department of Labor, Tony Pham and Lydia Nguyen, spoke to the largely Vietnamese forum. They explained when investigators inspect salons, the first document they will ask for are time cards.

Both manicurists and owners at the forum talked about the “customer is first” mentality of nail salons. Saying no to a customer who walks in right at closing is difficult, so the manicurists stay to work. Those hours add up, but not at a rate favorable to the employee.

Source: LA Times

Netflix Has a New Paternity and Maternity Leave Policy

HealthMiles, a workplace health company, released a survey in 2013 of about 10,000 employees in which 77% of employees agreed that “health and wellness programs positively impact the culture at work.” Following these findings, streaming giant Netflix has introduced a new unlimited paternity and maternity leave policy to promote the healthy morale of employees.

New parents, both mothers and fathers, are now entitled to take unlimited leave for the first year of a child’s birth or adoption. Netflix employees will receive normal pay and have the option of returning to work either full or part time. If additional time off is necessary, the company will allow employees to take that time.

This new paternity and maternity leave policy joins the company’s already unlimited time off policy. It aims to eliminate the hassle and confusion of going out on a disability leave or an FMLA leave.

“Netflix’s continued success hinges on us competing for and keeping the most talented individuals in their field. This new policy…allows employees to be supported during the changes in their lives and return to work more focused and dedicated,” commented Tawni Cranz, the chief talent officer.

Netflix took the lenient leave policies of other companies and ran with it. Google, for example, extended their paid maternity leave policy from 12 weeks to 18 weeks about 8 years ago. When that occurred, Google saw an increase of retention of returning new mothers.

Source: NY Times and Forbes Magazine