18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 375 Plaintiff as a gas station cashier and manager. Id . at *1. Plaintiff filed the action against Shell and the MSO operator, and contended that Shell was his joint employer. Shell filed a motion for summary judgment relying on two previously decided cases in which the California Court of Appeal found that Shell was not the Plaintiffs’ employer as a matter of law. The trial court concluded it was bound by these prior decisions and granted the motion. On appeal, the Court of Appeal reversed and remanded the trial court’s ruling. The Court of Appeal observed that Plaintiff’s case differed from the two previously decided in material ways. Plaintiff contended that Shell employees told him they had the power to fire him, or to have him fired, had direct flow of payments for fuel, and that Shell had contractually-mandated control over the MSO operators’ bank accounts. The other opinions also did not discuss Shell’s ability to add or remove individual stations to and from MSO operator clusters at any time, for any reason, as Plaintiff did in the instant action. The Court of Appeal determined that these factual distinctions were significant, as they showed a degree of control not presented in the other cases. The Court of Appeal explained that a Plaintiff can establish a putative joint employer relationship if they show that the employer had enough control over the intermediary entity to indirectly dictate the wages, hours, or working conditions of the employee. The Court of Appeal found that Plaintiff sufficiently alleged enough to support such a finding. For these reasons, the Court of Appeal reversed and remanded the trial court’s ruling. Moniz, et al. v. Adecco USA, Inc., 2021 Cal. App. LEXIS 1005 (Cal. App. 1st Dist. Nov. 30, 2021). In separate representative actions under the Private Attorneys General Act of 2004 (“PAGA”), Plaintiffs in Moniz v. Adecco USA, Inc. , a private party class action, and Plaintiff Corea sued Defendant to recover civil penalties for violations of the California Labor Code (“CLC”). Plaintiffs’ claims were similar in that all alleged that Defendant’s non-disclosure agreements, policies, and practices violated the CLC. The Moniz parties moved for approval of a settlement agreement reached where Defendant agreed to pay $4.5 million to settle the claims and the trial court approved the settlement. The California Labor and Workforce Development Agency (“LWDA”) moved ex parte to intervene, objecting to the settlement and seeking to vacate the judgment because the final settlement had not been timely served on the LWDA. Correa also filed a post-judgment motion to vacate the judgment. The trial court vacated the judgment because timely notice of the settlement had not been provided to the LWDA. Moniz filed a renewed motion to approve the settlement, which Defendant joined. The LWDA and Correa objected to the settlement on several grounds, including that the settlement release was overbroad. The trial court held a settlement approval hearing where it acknowledged the lack of binding authority providing a standard by which a PAGA settlement should be reviewed. The trial court applied the “fair, reasonable, and adequate” standard applicable to analogous class actions. The trial court also stated that no binding authority required it to apply the standard the LWDA advocated, i.e ., that a trial must find the PAGA settlement “meaningful, and consistent with the underlying purposes of the statute to benefit the public.” Id . at *12. Nonetheless, the trial court found that the proposed $4.5 million settlement was fair, reasonable, and adequate. The trial court further found that the settlement, which included a change of policy by Defendant in the language of its employment agreements, to directly address the concerns raised by the lawsuit was meaningful, and consistent with the underlying purpose of the PAGA statute. On appeal, Correa attacked many aspects of the settlement process and approval, including the standard used by the trial court to approve the settlement, and numerous alleged legal deficiencies of the settlement. The California Court of Appeal found that the trial court applied an appropriate standard of review, and rejected Correa’s contentions regarding the settlement’s purported substantive and procedural deficiencies. Nonetheless, the Court of Appeal reversed the judgment because it was unable to infer from the record that the trial court assessed the fairness of the settlement’s allocation of civil penalties between the affected aggrieved employees or whether such allocation comported with the PAGA. For these reasons, the Court of Appeal reversed the judgment of the trial court. Santos, et al. v. El Guapos Tacos, LLC, 2021 Cal. App. LEXIS 1007 (Cal. App. 6th Dist. Nov. 30, 2021). Plaintiffs, two restaurant employees, filed a class action alleging that Defendants failed provide lawful meal breaks, authorize and permit rest breaks, maintain and provide earning statements, timely pay all wages due upon termination, and pay compensation for all work performed in violation of the California Labor Code. Id . at *2. Plaintiffs also alleged unfair competition and sought civil penalties under the California Private Attorney General Act (“PAGA”). The trial court previously had granted Defendant judgement on the pleadings for Plaintiff Santos’ PAGA cause of action based on failure to serve notice and initiate her claim within one year after she stopped working for Defendants. The trial court thereafter ruled that Plaintiff Chavez-Cortez had failed to exhaust her administrative remedies under § 2699.3. On appeal, the California Court of Appeal reversed the trial