happy holidays

San Diego sdea newsletter | november 2011

san diego employers association 4180 ruffin road, ste. 295 p. 858.505.0024 www.sdea.comsan diego, ca 92123 f. 858.715.1202 info@sdea.com

Employers Association

2 What’s New at SDEA

4 New Limits on Background Checks

5 Sick Just Thinking About It ... Flu Season

7 HR Spotlight

8 Closing for the Holidays? Read This First!

9 CA Court Limits Class Action Waivers

11 HR Strange But True

12 Your Questions, Answered!

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Tis the Season: Preparing for the Holidays in the WorkplaceBy Michelle Sedgwick

The past few years have been hard on so many organizations. Companies have had to administer pay cuts, change benefit plans and even lay off employees. Chances are, your organization has had to make changes, but still wants to celebrate the upcoming holiday season by doing something positive for your employees.

Last year, leading global executive search firm Amrop Battalia Winston conducted their 22nd Annual Holiday Party survey. The results showed the largest decline of holiday parties by companies in the past 22 years – only 79 percent of businesses were conducting some type of holiday celebration.

Although the numbers aren’t in yet from the 2011 survey, the search firm predicted that there would be an increased number of parties as the US economy gets a stronger foothold in the recovery. In the meantime, employers may want to weigh the costs and benefits of hosting a holiday party this year before moving forward with party planning. The following are some considerations to take into account in the decision making process:

• Understand the benefits that a holiday party can provide for your employees. It allows employees and managers to bond with each other and can help boost productivity. Many companies in the survey mentioned above held parties to help boost employee morale and to show clients that they were optimistic about the future year.

• Consider surveying employees to find out if having an event/party is even important to them. Maybe employees would prefer to have holiday party budget put towards a merit increase budget this year.

-continued onto page 3-

What’s New at SDEA

›› Save the Date!SDEA’s Employment Law Update will be held on January 12th, 2012. Mark your calendars! More details coming soon.

›› Thank you for your support!On October 16th, SDEA participated in the American Cancer Society’s Making Strides Against Breast Cancer Walk.

Thank you to all of those who supported our team and this cause! We are so excited to have been part of such a great event and proud to be able to contribute to such an important cause. We even surpassed our fundraising goal! Photos from the event can be found on our Facebook page.

Novmeber 2011

President CHRIS BRYANTDirector of HR Services JENNIFER JACOBUS, PHR-CA

HR Consultant MICHELLE SEDGWICKMarketing and Member Services Manager RACHELLE MORRIS

Member Relations Manager BECKY SUFFRIDGEAdministrative Assistant JANELLE LOPEZ

•Columnists JENNIFER JACOBUS, PHR-CA & MICHELLE SEDGWICK

Design and Layout RACHELLE MORRIS

SDEA Board of Directors

MIKE DALY Daly Law Firm

HOLLY GREEN The Human Factor, Inc.

TRUDY ARMSTRONG The San Diego Foundation

DARREN CECIL Sandler Training

STACEY MCKIBBIN ActionCOACH

LAURIE PECK, CPA

CARLA STANLEY Sedona Staffing

MIKE WHITEHURST, CFA, CIC McCuen & Co.

Board Chair MELANIE POTTER

Walter Andersen Nursery

SDEA is a not-for-profit employer’s association that provides HR advice and consulting to its members in an effort to promote and maintain employer/employee relationships. We are not attorneys and do not render legal advice.

TOM MURCH & TOM PUFFER Honorary Life Members

november newsletter 2011 3

• If your company has experienced recent layoffs or other significant cuts during the past year, it might be wise to consider forgoing a party altogether or instead hold a scaled down event.

Alternative ideas to the typical holiday party

Although it may be necessary to cut back on the usual holiday party, it’s still possible to celebrate the season and show employees that their hard work is valued. Keep in mind the goal for hosting a party, the attributes and interests of your workforce, and your budget. By thinking outside the traditional holiday party box a bit, you may come up with something your employees will appreciate even more. The following ideas might get your creative thinking started:

• Give back to the community as a team: Pick a cause that is important to your organization or employees and either volunteer together or host a party for donations. Local San Diego organiza-tions like the San Diego Food Bank are able to accommodate groups of volunteers. Another option is to “adopt” a family or classroom who needs some extra help to have a happier holiday season this year. Consider hosting a small holiday “donations” party at the office.

• Combine a holiday event with an opportunity for reward and recognition.

• Host departmental parties: Provide department managers with a budget that can be used according to the interests of their employees. Doing so can significantly reduce the expenses and shift the responsibility to departments.

• Consider hosting a party during the day: Having breakfast or lunch catered to the worksite can be an option. Breakfast and lunch menus are always more cost effective and it eliminates the need to use personal time, especially during a sometimes busy season, to attend the company event.

• Invite employees to bring their favorite dish to a Potluck lunch

• Dessert party: Who doesn’t like some sugary delights at the holidays? Host a dessert buffet to reward a team who has really pulled through for the company this past year.

Tis the Season: Preparing for the Holidays in the Workplace- continued from cover story-

Common holiday party HR issues

If your company makes the decision to host some type of holiday celebration, it is an opportunity to thank employees for the value to the organization. Remember to keep the following tips in mind as you begin the party planning process:

• Remember that not all employees want to celebrate holidays. Parties and outings should not be mandatory for employees, so make it clear to all employees that attendance at social functions is strictly voluntary.

• If you hold the event in the office during what would typically be work hours, make sure you pay your employees for their attendance. If they don’t wish to attend, they can either use vacation time and leave the office or continue working, if it’s feasible.

• Beware the gift exchange: Be mindful that some employees may not believe in exchanging holiday gifts or it simply may not be in the budget this year. If a gift exchange is part of the celebration, keep it on a voluntary basis.

• Alcohol: It’s not new information that, for a variety of reasons, alcohol and work parties don’t always mix. Employers can lessen their liability and the hit to the pocketbook for the company and if they avoid serving alcohol altogether it may also avoid some embarrassing or dangerous situations that can occur when alcohol is part of the festivities.

However you choose to celebrate, take time to recognize your employees for their contributions in 2011 and their accomplishments that will take you into 2012. SDEA is available to help you with your HR needs as you wrap up this year and head into the next. Call on us at (858) 505-0024 or visit our website at www.sdea.com.

New Limits On Background ChecksBy Jennifer Jacobus, PHR-CA

Governor Jerry Brown signed a bill in October (AB 22) that will limit employer’s use of consumer credit reports. This new bill, effective January 1, 2012, will prohibit employers from using credit checking during the hiring process unless the job is:

• A position with the State Department of Justice• A sworn peace officer or other law enforcement position• A position for which the information in the report is required to be disclosed by law or to be obtained by the

employer• A manager• A name signatory on an employer’s bank account or credit card application• Anyone who is authorized to transfer money or enter financial contracts on behalf of an employer• Anyone with access to trade secrets or access to $10,000 or more in cash during the workday• Anyone who regularly works with information that can be used to commit identity theft

Many employers automatically include a credit report in their routine background checks but this practice will need to be limited to the above criteria. The use of credit checks has become a bigger issue over the past several years with the recession and the increased bankruptcy filings and home foreclosures that may be prohibiting some applicants from becoming an eligible candidate. Many people who lost their jobs have ended up with bad credit, thus resulting in unfair treatment and discrimination against people who have faced financial difficulties but would other-wise make good employees.

Employers who require any kind of background check should remember that all applicants must be informed that there will be a background check and that they will be able to request a copy of the report from the reporting agency—a signed acknowledgement is required. If the job is denied for anything found in the background check, the applicant must be advised.

Getting to Know the SDEA TeamBecky Suffridge, Member Relations ManagerThe road that led me to where I am now: My father served for 30 years as an active-duty Naval officer, and after years of travel we settled in San Diego. Throughout my professional career, I've always held positions tied to developing and enhancing client relationships, working primarily in the fields of staffing, education, and volunteerism. I received my BA in Communication from the University of

Hawaii, and my MA in Speech Communication from SDSU - go Aztecs!

What I like best about my role: In my role as Member Relations Manager, I have the opportunity to serve our existing members, while reaching out to non-member organizations that could benefit from SDEA's assistance and expertise. I enjoy meeting and supporting people who are working in all types of industries and businesses, both large and small.

Professional success secret: Follow the Golden Rule - at all times, treat others as you would like to be treated.

Who or what inspires me and why? I take my inspiration from others - family, friends, and everyone I've have the good fortune to meet along the way. People are fascinating!

How I like to spend my free time: When I'm not hanging out with my husband and three fun-loving kids, I'm hiking most days of the week in Mission Trails, often before the sun rises.

My 3 dream Jeopardy categories: Hiking trails of Southern California, Best Kept Secrets of San Diego, Bargain Shopping

Something you'd find on my "bucket list": Backpacking through New Zealand.

november newsletter 2011 5

Sick Just Thinking About It…Flu SeasonBy Jennifer Jacobus, PHR-CA

Most employers have one of two types of employees—the employee that will call out sick due to the slightest thing (a minor sniffle or a hangnail) and those who come in to work when they have no business being at work (high fever, flu systems, hacking coughs). While we appreciate the dedication of this employee, we don’t need them in the office getting the rest of the workforce sick.

Now is also a good time to give your sick leave policies a once-over. How much time does the company offer? Is the time off with pay or is it unpaid? When is absenteeism considered excessive? What happens when an employee has exhausted all of their sick leave? These are all real situations that many employers face and knowing how you will handle them will help you deal with the implementation of your sick leave policies in a smoothly and consistent manner. Companies should also remember that if you do offer paid sick leave that employees are allowed (by state law) to use half of their accrued time off to care for a sick family member (parent, child, spouse, or registered domes-tic partner). Remember to be consistent with absences, especially when dealing with excessive absences and perfor-mance and remember your documentation.

To minimize absenteeism, employers frequently offer onsite seasonal flu vaccination to employees at no or low cost to their employees. This option can work well if the employer has an on-site occupational health clinic. If you don’t have a clinic, pharmacies and community vaccinators can be contracted to provide seasonal flu vaccination services on-site. By providing the vaccination at the workplace, employers reduce the many barriers that can prevent a worker from getting vaccinated.

The Centers for Contagious Disease Control and Prevention have some great resources on their website, http://www.cdc.gov/flu/business/ that can assist employers with prevention that include posters and flyers to distrib-ute to your workforce.

Looking for Helpful Links, Checklists and Forms?We know the job of the HR professional can be a demanding one. In order to help make things a bit easier, click

on any of the below links to find help checklists, forms or website. These can all be found on SDEA’s website under the Resources tab.

Labor Laws Based on EE CountObserved Holidays 2011-2012Form I-9: Employers Handbook | I-9 Form (English) | I-9 Form (Spanish)State Disability Insurance Provisions: Form DE 2515For Your Benefit – California’s Program for the Unemployed: Form DE 2320Sexual Harassment Pamphlet (DFEG)Employment Determination Guide (Independent Contractors vs. Employees): Form DE-38W-4: Employee Withholding Allowance CertificateCA Employee’s Withholding Allowance Certificate: Form DE-4Cal/OSHA Form 300: Log of Work-Related Injuries and IllnessesCal/OSHA Form 300A: Annual Summary of Work Related Injuries and IllnessesCal/OSHA Form 301: Injury and Illness ReportVETS-100/VETS-100A FilingEDD: California Employer’s GuideWage Order LinksRelevant State and Federal Agency Links

Looking for more? Members - log in to gain access to even more!

november newsletter 2011 6

Congratulations to November’s Special SDEA Membership Anniversaries!

Thank you for your many years of loyalty!

Fertility Specialist Medical Group 10 Years!Supreme Oil Company 10 Years!Certified Folder Display Service, Inc. 12 Years!MV Technical Sales, LLC 12 Years!Sunset Parking Services 12 Years!Superior Planning 12 Years!Ideal Plumbing & Heating 13 Years!Nine Dragons, Inc. 13 Years!San Diego Nutrition, Inc. 16 Years!Schwartz Design Group 16 Years!

In Appreciation of your referrals, we would like to present our new Member Referral Program!

For each company that joins SDEA as a result of your referral, you will receive a choice of: one free attendance at one of our Roundtable luncheons and recognition in our monthly newsletter, or a $25 gift card and recognition in our monthly newsletter.

For each company referred, your company will receive an entry in a drawing* to win an office lunch for you and 10 of your co-workers, brought in and served by SDEA!!!

To participate, simply submit the name, contact information and company name of business peers you feel could benefit from SDEA’s services to rmorris@sdea.com.

For more information, please contact Rachelle Morris at 858-505-0024.

*drawing to take place once a year, in June.

Member Testimonial

It always amazes me how extensive the knowledge of the consultants is - they are always so helpful and give great advice.

Jeanie LeavinsonVeterans Village of San Diego

Pre Pak Products, Inc. 18 Years!Viejas Casino 19 Years!Pathology Diagnostic Specialists LLC 20 Years!Abbey Party Rents 21 Years!Installation Technology 23 Years!Standard Meat Company 25 Years!Harbor Pest Control 34 Years!Merry X-Ray Chemical Corporation 41 Years!Inland Industries Group LP 46 Years!Atlas Chemical, Inc. 58 Years!

HR Professional SpotlightHR Professional: Brett PugliesiCompany: Superior Mobile Medics

CAREERYears in HR: 3 Years

The road that led to the profession:While pursuing my Bachelor’s degree of Science in Business and Management, I found an inspiration and attraction to the HR profession. When I began working at SMM in 2004, I expressed my intention and desires to one day be in HR. With my drive to succeed and a solid work ethic as well as the support from Senior Management, I was promoted to a management position in which I led a team of sixteen Customer Service Represen-tatives. This is where I found my passion for the people and their professional development. After several years in the management role, I was promoted to Director of Human Resources.

If I didn’t work in HR, my dream job would be: Growing up I always wanted to be an airline pilot because of my obsession with flying. Today I would probably choose a professional athlete or an actor.

HR PHILOSOPHYGuiding principle: Treat people with respect, honor confidentiality, make someone’s day, and always have fun.

Most effective way to learn and partner with the business: Be open to change and support the decisions of Executive Management.

Favorite component of Human Resources: I love experiencing the development of employees and the members of the management team. I am happy to be a resource for all of our employees; for both their professional and personal needs.

WISDOM FROM THE HR TRENCHES Most important lesson learned: Never take anything personally, and document EVERYTHING!

Advice to someone starting a career in HR: Attend as many seminars and conferences as you can; not only will this help with your continued education in the field, but it will also help you build a valuable network of HR professionals. Also, make sure you are always at the executive table; HR needs to be involved in some of the businesses’ major decisions.

Hardest business decision: Terminating employees that give 100% of their effort, but ultimately are unable to meet perfor-mance expectations.

TAKING OFF THE “HR HAT”Favorite way to spend time outside of work: I love the beach and anything involving water. I enjoy competing in several triathlons throughout the year, including a ½ Ironman race. I surf, bike, play softball, and ski in the winter and I love to travel with my partner and spend time with family and friends.

Favorite Food: All Asian food, especially Thai; and Pizza! I could never live without pizza.

Three greatest passions: Living every moment as if it were your last, laughing, and eating.

Would you like to be featured in our newsletter? Email Rachelle Morris at rmorris@sdea.com

Superior Mobile Medics

Year Founded: 1995

Number of employees: 94

About Superior Mobile Medics: Superior Mobile Medics specializes in providing the mobile examinations for life and disability insurance policies throughout the United States. Superior Mobile Health Solutions (a division of SMM), provides cost effective wellness solutions for employer groups across the country. Service offerings include health risk assessments, on-site biometric screen-ings, and flexible reporting tools.

november newsletter 2011 8

Closing For The Holidays? Better Read This First!By Jennifer Jacobus, PHR-CA

With the holidays right around the corner (check your calendar if you don’t believe me) your company might be looking ahead to see what days of the week particular holidays fall on, and considering a holiday closure. Many employers use this time of year-especially in these trying financial times—to close so that they can save on payroll by not paying their employees, or encouraging, and even requiring, employees to use up some of their accrued vacation in order to get the liability off the books. If this is something you may be considering for the first time or something you have done in the past, make sure to take the following into consideration:

• If an exempt employee works any portion of a workweek and the company is closed for a portion of the week due to time off for holidays, the exempt employee must be paid for the entire workweek. If the holiday closure is for an entire workweek, then no pay would be owed to the exempt employee

• If an employer is requiring employees, exempt or non exempt, to use accrued vacation during holiday closures, it is recommended by the DLSE that the employer provide employees with a notice of at least a fiscal quarter, or 90 days

• Remind employees of any policy requirements such as working the day before and after a scheduled holiday in order to receive the holiday pay

• If one, some, or many are required to work during a holiday closure, make sure they are paid accordingly. Non-exempt employees are only required to be paid for hours worked but, as stated above, an exempt employee would need to be paid for the entire workweek

• If employees are given holiday pay (provided for by the company) for the time off and are required to work, they should be given some-thing in lieu of the holiday such as holiday pay plus pay for hours worked (for non exempt employees) or another day off with pay

Whatever the plans for the holidays, expect the unexpected and make sure to provide your employees with as much advance notice as possible for anything that may affect their pay and/or benefits.

Religious Accommodations for the Holidays

While the majority of companies choose Christ-mas as a paid holiday, employers with a diverse workforce should keep in mind that you are at least required to consider accommodations for other religious holidays. If you have employees requesting time off for Yom Kippur or Hanukkah (and probably both) while you would not be required to pay them, you do need to make accommodations if it will not be an undue hardship on the company. You can require employees to use accrued vacation or PTO time for such absences.

When considering what may constitute an undue hardship, you can take into consideration the financial impact on the organization or the number of employ-ees who have also requested the time off as it might pertain to productivity, but you may not deny a request based on the fact that “others may also want the time off” or if it seems “fair” or not to other employees.

Brinker Update

A decision for the Brinker Restaurant Corp v. Superior Court of San Diego case. It has been the one of the most anticipated decisions among HR professionals in California for nearly 3 years and the California Supreme Court recently announced that oral arguments will begin on November 8th. Once oral arguments take place, the court has 90 days to prepare and release an opinion. The significance of this case is that it will decide whether employers may simply “provide” meal and rest periods for employees or if they must actively enforce these breaks on an ongoing basis. For those of us eagerly awaiting details about the impact on wage and hour law, we will hopefully have a decision by sometime early next year!

Stay tuned for more details...

november newsletter 2011 9

California Court Limits U.S. Supreme Court’s Ruling on Class Action WaiversCompliments of BLR

November HR Roundtable

November 18, 2011: Will They Be Back? Do the Right Thing & Avoid These Top 10 Terminations MistakesTerminations are one of the more unpleasant tasks that owners, managers and supervisors have to carry out, but are a necessary part of business. Mistakes committed during the firing process can come back to haunt you by the way of legal action, if you’re not careful. This roundtable will address the top hiring mistakes seen most often by employment law attorneys and provide you with tips on how to avoid them.

For complete descriptions and details visit www.sdea.com

The use of this seal is not an endorsement by HR Certification Institute of the quality of the program. It means that this program has met HR Certification Institute’s criteria to be pre-approved for recertification credit.

Earlier this year, the U.S. Supreme Court rejected the California rule that prohibits the use of class action waivers in consumer arbitration agreements. Many court watchers predicted that as result of that ruling (AT&T Mobility, LLC v. Concepcion), similar waivers in employment-related arbitration agree-ments would be enforced going forward.

Now the state Court of Appeals has weighed in with its first significant decision on the issue, and the outcome isn’t exactly what employers hoped for. The appellate court’s ruling makes clear that it will take more than just a class action waiver to kill off employment-related lawsuits brought on behalf of groups of employees in California.

Grocery Workers Sue Their Employer Terri Brown began working for Ralphs Grocery as

a security guard in 2005. She filed a class action and a “representative action” under the state Private Attorney General Act of 2004 (PAGA) against Ralphs for alleged violations of the California Labor Code. The employer asked the court to compel arbitration of the claims, based on its mandatory arbitration policy, which Brown had acknowledged and agreed to in her employment application.

Under the arbitration policy, employment-related disputes could not be heard in court or arbitration “on a class action basis, as a private attorney general, or on bases involving claims or disputes brought in a representative capacity on behalf of … other Ralphs employees … There are no judge or jury trials and there are no class actions or Representative Actions permitted under this Arbitra-tion Policy.”

The trial court found that the class action and PAGA waivers were unconscionable and rendered the agreement unenforceable. The employer appealed.

Before the Court of Appeals heard the appeal, the U.S. Supreme Court overturned California’s rule that class action waivers in consumer arbitration agreements are generally unenforceable or unconscio-nable.

Class Actions vs. PAGA ActionsThe PAGA permits employees to seek permission

from the state Department of Industrial Relations to file their own lawsuit to recover penalties for wage and hour violations. The law was designed to augment the understaffing of the state’s labor law enforcement agencies.

The PAGA allows employees to seek civil penal-ties on behalf of current and former employees for California Labor Code violations. Employees may find it easier to pursue these representative actions than traditional class actions because the latter must meet several requirements that don’t apply to PAGA actions, including obtaining class certification.

Under PAGA actions, however, employees can recover only 25 percent of the full penalty amount, with the remaining 75 percent going to the Labor and Workforce Development Agency for Enforcement of Labor Laws and Education. Also, PAGA actions can only recover civil penalties and reasonable attorney’s fees and costs, not the civil damages available in class actions.

Court Invalidates PAGA WaiverThe Court of Appeals here declined to extend the

U.S. Supreme Court’s ruling on class action waivers to waivers of PAGA representative actions. As the appellate court noted, the Supreme Court did not address waivers of private attorney general actions to enforce the Labor Code in its recent AT&T Mobility ruling.

-continued onto page 10-

november newsletter 2011 10

California Court Limits U.S. Supreme Court’s Ruling on Class Action Waivers-continued from page 9-

In that decision, the Supreme Court considered the private individual right of a consumer to pursue class action remedies in court or arbitration, conclud-ing that the right could be waived by mutual agree-ment. But the PAGA creates a public right for an aggrieved employee to act as the proxy or agent of the state labor law enforcement agencies in a proceeding designed to protect the public, rather than benefit private parties.

As the Court of Appeals explained, PAGA’s purpose isn’t to recover damages or restitution but to “deputize” citizens as private attorneys general to enforce the Labor Code. Single-claimant arbitration under the PAGA—for only individual penalties—wouldn’t produce the penalties contem-plated under the law to punish and deter unlawful employer practices.

In short, the court held that allowing waivers of PAGA representative actions would largely nullify the benefits of private attorney general actions. It there-fore returned the case to the trial court to determine whether to simply sever the unenforceable PAGA waiver from the agreement or refuse to enforce the entire agreement or parts of it. Brown v. Ralphs Grocery Co., Calif. Court of Appeals (Dist. 2) No. B222689, (2011).

Court Punts on Class Action WaiversRalphs’ arbitration provision also contained a

class action waiver, presenting the Court of Appeals with the opportunity to apply the Supreme Court’s ruling in an employment-related context and settle some uncertainty that followed it. But the court did not directly address the issue.

Instead, it relied on the fact that Brown didn’t provide the necessary evidence California law requires to invalidate a class action waiver in an employment arbitration agreement. Thus, the court said, it needn’t

determine whether the AT&T ruling applies to class action waivers in the employment context. Without the necessary evidence to do so, whether the state court could invalidate the waiver was moot.

What to Expect Next The question of whether the Supreme Court’s

ruling in the AT&T case applies not just to consumer arbitration agreements but also to employment arbitration agreements is sure to come up again in the Court of Appeals (and probably the California Supreme Court). Until then, you can expect a jump in PAGA representative actions as employees attempt to circumvent compelled arbitration. Keep in mind that there’s no guarantee yet that the California courts will enforce even your class action waivers.

Practice Tip: The fact that class action waivers in arbitration provisions aren’t necessarily unconscio-nable on their face doesn’t mean that a court won’t consider your arbitration provisions unconscionable for another reason.

For the month of November SDEA will waive the application fee (Members: $100, Non-members: $150) for those who enroll in this program.

Call SDEA for more details at 858.505.0024

november newsletter 2011 10

California Court Limits U.S. Supreme Court’s Ruling on Class Action Waivers-continued from page 9-

In that decision, the Supreme Court considered the private individual right of a consumer to pursue class action remedies in court or arbitration, conclud-ing that the right could be waived by mutual agree-ment. But the PAGA creates a public right for an aggrieved employee to act as the proxy or agent of the state labor law enforcement agencies in a proceeding designed to protect the public, rather than benefit private parties.

As the Court of Appeals explained, PAGA’s purpose isn’t to recover damages or restitution but to “deputize” citizens as private attorneys general to enforce the Labor Code. Single-claimant arbitration under the PAGA—for only individual penalties—wouldn’t produce the penalties contem-plated under the law to punish and deter unlawful employer practices.

In short, the court held that allowing waivers of PAGA representative actions would largely nullify the benefits of private attorney general actions. It there-fore returned the case to the trial court to determine whether to simply sever the unenforceable PAGA waiver from the agreement or refuse to enforce the entire agreement or parts of it. Brown v. Ralphs Grocery Co., Calif. Court of Appeals (Dist. 2) No. B222689, (2011).

Court Punts on Class Action WaiversRalphs’ arbitration provision also contained a

class action waiver, presenting the Court of Appeals with the opportunity to apply the Supreme Court’s ruling in an employment-related context and settle some uncertainty that followed it. But the court did not directly address the issue.

Instead, it relied on the fact that Brown didn’t provide the necessary evidence California law requires to invalidate a class action waiver in an employment arbitration agreement. Thus, the court said, it needn’t

determine whether the AT&T ruling applies to class action waivers in the employment context. Without the necessary evidence to do so, whether the state court could invalidate the waiver was moot.

What to Expect Next The question of whether the Supreme Court’s

ruling in the AT&T case applies not just to consumer arbitration agreements but also to employment arbitration agreements is sure to come up again in the Court of Appeals (and probably the California Supreme Court). Until then, you can expect a jump in PAGA representative actions as employees attempt to circumvent compelled arbitration. Keep in mind that there’s no guarantee yet that the California courts will enforce even your class action waivers.

Practice Tip: The fact that class action waivers in arbitration provisions aren’t necessarily unconscio-nable on their face doesn’t mean that a court won’t consider your arbitration provisions unconscionable for another reason.

For the month of November SDEA will waive the application fee (Members: $100, Non-members: $150) for those who enroll in this program.

Call SDEA for more details at 858.505.0024

november newsletter 2011 11

HR Strange But True: That's One Way to Get More Days OffCompliments of BLR Archive 2007

Meet Robert Joseph Thom, a federal employee who is facing fraud charges after fellow federal workers donated nearly 1,000 hours of leave because they thought he had cancer.

A federal grand jury has indicted Thom on 10 counts of wire fraud. Prosecutors allege that he submitted false documents about his medical condition to the United States Geological Survey in order to apply for the federal voluntary leave transfer program.

Thom was working as an IT specialist at the United States Geological Survey in Southern California when he applied for the leave transfer program, submitting medical documents in which he stated that he had undergone "multiple urgent surgeries" for malignant cancer, prosecutors allege.

After he submitted the documents, the agency placed him on the federal agency's national list to receive dona-tions of annual leave time from other federal employees, prosecutors allege.

Thirty agency employees stepped forward to donate 995 hours of annual leave so that Thom could continue to receive a federal government salary and benefits, prosecutors say. Prosecutors estimate that the value of the leave was more than $40,000.

The indictment also alleges that Thom submitted false periodic progress reports about his post-surgery recovery including that, per doctor orders, he needed more time off work to "remain home" and "get plenty of rest."

The San Diego Union Tribune reports that the employees who donated leave to Thom will get it back.

Sources: Justice Department and the San Diego Union Tribune

We’re Proud of Our Members!We’ve been in our new office for about 10 months now. Even though we have some calming green walls and plants throughout the office, it still feels like there is something missing...our Members! We want to decorate our walls with photos of the companies and organizations that we are so fortunate to have as members.

You can help us decorate by submitting photos of your staff together. Photos could be from an event you all partici-pated in, an outing, or even just a typical day in the office. Descriptions are encouraged as well.

Please submit your photos and descriptions to: rmorris@sdea.comOr mail them to:Rachelle Morris4180 Ruffin Road, Ste 295San Diego, CA 92123

We look forward to showing you off!

november newsletter 2011 12

Q. Since Christmas and New Year’s Day are on a Sunday this year, am I obligated to pay my employees for these holidays?

A. Employers are not legally required to provide vacation or holiday pay to employees. If an employer provides holiday pay as a benefit to its employees, then employees scheduled to work on the recognized holiday would receive 8 hours straight time and 8 hours of regular pay. The alternative would be to offer a “floating” holiday for the employee to take on another day. Keep in mind, however, that a floating holiday is treated as a vacation day and if not used would need to be paid out at termination.

This year, most employers will observe Christmas and New Year’s Day on the following Monday for purposes of holiday pay.

SDEA Helpline Q & A

Q. I currently have 2 employees out on leave of absence covered under FMLA. Am I required to pay them for the upcoming holidays while they are on leave?

A. Neither the California Law (CFRA) or federal law (FMLA) require that an employee on leave of absence be paid for upcoming holidays. However, if an employer included this benefit in the employment contract or employee handbook they must adhere to the promised course of action in this situation.

Every month SDEA receives hundreds of calls. Here readers have the opportunity to “eavesdrop” on answers to popular (and anonymous) HR questions received during the previous month.

Advertising And Article Submission InfoThis newsletter is published monthly by the San Diego Employers Association. We welcome the submission of articles by our members on topics of interest related to HR. Date for submission of materials and advertising is the 15th of the month prior to publication. If you are interested in submitting an article or obtaining advertising rates, please email: rmorris@sdea.com.

With the help of SDEA, members have the tools to: ›› Keep up to date with ever changing employment laws ›› Attract, develop, and retain valuable employees ›› Avoid lawsuits, fines and penalties

SDEA Membership Benefits Include: ›› Unlimited consultation with a staff of HR experts ›› 24 hour online resource center ›› Discounts on events and training classes ›› Complimentary training needs analysis ›› SDEA’s annual Wage & Salary Survey (free with participation) ›› SDEA’s Policies & Benefits Survey (free with participation) ›› SDEA’s monthly newsletter

SDEA Membership Value 101

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