Cal-Peculiarities: How California Employment Law is Different 2022 Edition

252 | 2022 Cal-Peculiarities ©2022 Seyfarth Shaw LLP  www.seyfarth.com The Supreme Court took review of the decision but not on the issue of joint employment. The Supreme Court instead granted review of the Court of Appeal’s decision to let the lawsuit proceed against the payroll company on various theories of liability (contract, negligent representation, and professional negligence), and in a 2019 decision determined that none of these theories was viabl e. 454 (See § 16.3.7). The Court of Appeal addressed a production company’s joint employer status in a 2020 case, reversing a summary judgment in favor of a firm that agreed to stand in the place of a television production company (because the firm was a signatory to the relevant CBA while the production company was not). The firm could be liable as an employer not only because it had signed the CBA but also because the firm had the power of control over the plaintiff’s work . 455 7.21.2 Other liability imposed for another employer’s Labor Code violations Customers of delinquent port drayage motor carriers. Legislation effective in 2019 requires the DLSE to post on its website a list of port drayage motor carriers that have any unsatisfied judgment or assessment or any “order, decision, or award” finding illegal conduct as to various wage/hour issues, specifically including independent contractor misclassification and derivative claims. The new law also extends joint and several liability to the customers of these drayage motor carriers for their future wage violations of the same nature . 456 Direct construction contractors. Legislation enacted in 2018 clarified Labor Code section 218.7, which created joint liability for construction contractors and subcontractors. The new legislation repealed the express provision that relieved direct contractors for liability for anything other than unpaid wages and fringe or other benefit payments or contributions owed . 457 Temporary employment agencies. The Court of Appeal has held that a staffing agency with its own compliant policy on meal periods need not police the meal periods of its employees who were working on a client employer’s premises, and that the staffing company, as an alleged joint employer, was not vicariously liable for the client employer’s own violations . 458 U nder this authority, joint employers are not vicariously liable for each other’s Labor Code violations, but rather are liable for their own conduct. A 2018 Court of Appeal decision, Castillo v. Glenair, Inc. , held that workers who settled their wage and hour suit against a staffing company could not then sue the client employer on identical claims, because the client employer and the staffing company were in privity with one another for purposes of the wage and hour claim, and the client company was an agent of the staffing company with respect to the staffing company’s payment of wages to its employees who worked at the client compan y. 459 During 2020, the Court of Appeal introduced further mischief into joint-employer litigation by disagreeing with Castillo and permitting a nurse—a staffing agency employee who had sued and settled with the staffing agency— to then sue the worksite employer (a hospital) on the same claims . 460 T he agreement settling the first lawsuit had not named the worksite employer as a released party, but the second lawsuit still should have been barred under the traditional doctrine of res judicata, or claim preclusion, as had been held in Castillo . The Court of Appeal, affirming the trial court, held that the settlement in the first suit did not bar the nurse’s second suit, because the staffing agency and the hospital were not in privity, and because the hospital was not a released party under the settlement agreement. A strong dissenting opinion pointed out that “ Castillo at least has the virtue of stating clear rules on which parties on all sides can easily rely going forward. I do not find Castillo to be so plainly wrong as to justify creating a split of authority in this area. ” 461 T his case is now on review by the Supreme Court, which is expected to rule in 2022.