18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 397 overtime premium hourly rate, determined by statute, that must be added to the employee’s standard wages to compensate the employee for working overtime. As such, the Court of Appeal found that these rates were plainly shown on the wage statements along with the hours worked at each rate. While other formats may also be acceptable, the Court of Appeal reasoned that given the complexities of determining overtime compensation in various contexts, Defendant’s format adequately conveyed the information required by statute. Further, the format also allowed employees to readily determine whether their wages were correctly calculated, which the Court of Appeal determined was the central purpose of § 226. In so ruling, the Court of Appeal pointed out that the alternative format that Plaintiff proposed would make such a determination more difficult. For these reasons, the Court of Appeal granted Defendant’s petition for a writ of mandate directing the trial court to vacate its order denying Defendant’s motion for summary adjudication. Gregg, et al. v. Uber Technologies, Inc., 2021 Cal. App. Unpub. LEXIS 2580 (Cal. App. 2d Dist. April 21, 2021). Plaintiff sued Defendant under the California Private Attorneys General Act of 2004 (“PAGA”), alleging that Defendant willfully misclassified him as an independent contractor rather than an employee, which led to numerous other California Labor Code violations. In response, Defendant moved to compel arbitration under the “Arbitration Provision" in the parties’ “Technology Services Agreement” (“TSA”) that Defendant accepted in order to become a driver on Defendant’s online platform. Id . at *1. The trial court denied the motion. In so ruling, the trial court rejected Defendant’s contentions that: (i) the issue of Plaintiff’s misclassification was a “threshold issue” related to whether he had standing to bring a PAGA claim, which was separate and distinct from the PAGA claim itself and therefore subject to arbitration; and (ii) the clause in the Arbitration Provision requiring Plaintiff to waive his right to bring a PAGA claim (“PAGA waiver”) was enforceable. Id. at *2. On appeal to the California Court of Appeal, Defendant largely raised the same arguments presented in the trial court to assert that its motion to compel arbitration should have been granted. The Court of Appeal was unpersuaded and affirmed the trial court’s order denying Defendant’s motion compel arbitration. In its ruling, the Court of Appeal relied upon its prior ruling in Williams v. Superior Court, 237 Cal. App. 4th 642 (2015), where it held that an employer may not compel an employee to arbitrate whether he or she is an "aggrieved employee" before proceeding with a PAGA claim in the trial court. Id . The Court of Appeal reasoned that the crux of Defendant’s argument relied upon the assertion that the issue of whether Plaintiff was an “aggrieved employee” under § 2699 was not a part of his PAGA claim at all, and therefore could be arbitrated even if the PAGA claim could not be arbitrated. Id. The Court of Appeal pointed out that California case law authorities had uniformly rejected this identical argument, and had consistently held that threshold issues involving whether a Plaintiff was an “aggrieved employee” for purposes of a representative PAGA-only action cannot be split into individual arbitrable and representative non-arbitrable components. Id . at *8. According to the Court of Appeal, a PAGA- only representative action is not an individual action at all, but instead is one that is indivisible and belongs solely to the state. For these reasons, the Court of Appeal concluded that the misclassification issue in this case was part and parcel of the indivisible representative PAGA claim asserted, which belonged solely to the state. Defendant alternatively argued that even if the misclassification issue was not separately arbitrable, the trial court should have enforced the arbitration provision’s PAGA waiver by dismissing or striking the representative PAGA claim and compelling arbitration of his PAGA claim on an individual basis. On this point, the Court outright rejected Defendant’s argument that Iskanian v. CLS Transportation Los Angeles, LLC , 59 Cal.4th 348 (2014) – where the California Supreme Court held that an employee’s right to bring a PAGA action was unwaivable and that an employment agreement that compels the waiver of representative claims under the PAGA is unenforceable as a matter of state law – was no longer good law. For these reasons, the Court of Appeal affirmed the trial court’s ruling that the PAGA waiver was unenforceable. Griffin, et al. v. Black Mountain Ranch, 2021 Cal. App. Unpub. LEXIS 5639 (Cal. App. 4th Dist. Aug. 31, 2021). Plaintiffs filed a class action against Defendants alleging causes of action for strict liability and negligence on behalf of themselves and a putative class of homeowners with copper-plumbed homes, alleging Defendants supplied them with "defective" water with elevated levels of copper, which damaged their plumbing and caused health problems. Id . at *7. Following discovery, Defendants moved for summary judgment on the grounds that they had no liability for either the defective potable water or the reservoir because City treated and sold the water, Defendants built the water system according to a "legislative mandate," and Plaintiffs could not establish Defendants owed a duty of care as a matter of law to support their negligence cause of action. Id . at *8. The trial court denied the motion. It ruled that the evidence permitted reasonable inferences as to whether Defendants