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ALERT!! NEW CALIFORNIA SUPREME COURT RULING ON OVERTIME–MUST READ!

Overtime pay in California is based on the employee’s “regular rate of pay,” which is not always an employee’s normal hourly wage and must include almost all forms of pay that the employee receives.

Yesterday, the California Supreme Court ruled that an employer must calculate the regular rate of pay by dividing the employee’s total compensation by the number of non-overtime hours an employee worked during the pay period, rather than the total number of hours the employee worked, including overtime hours (Alvarado v Dart Container Corporation of California).

Many of you may pay your employees a premium for working on a weekend or a night shift and you should be aware of this distinction in the law.   Others may pay a “make up amount” to compensate workers who have changed from a daily or weekly rate to an hourly rate and have a separate line to increase their pay to meet a minimum payment.  It may be subject to increased overtime rates as well.  This may eventually extend to housing or other items that are considered part of the regular compensation package.  It may all need to be included at some point as this ruling evolves.

In the case, Dart Container Corporation of California, allegedly maintained a policy of paying a flat “attendance bonus” of $15 per day to employees who worked Saturday and Sunday shifts, regardless of the number of hours worked on the weekend shift. An employee sued, claiming he was improperly paid overtime during the weeks that he earned the weekend attendance bonus.

The employee argued that overtime pay on any flat sum bonus should be divided only by the “regular” hours he worked that week (the method in the Division of Labor Standards Enforcement [DLSE] manual), not by the “total” hours worked during the week (regular hours plus overtime hours worked, the federal formula). For example, to determine the employee’s regular rate of pay, you would divide only by 40 regular hours instead of 48 total hours (regular hours plus overtime hours). This would result in a higher regular rate of pay and, thus, a higher overtime rate.

The California Supreme Court unanimously reversed the lower court and approved the DLSE method of calculating the regular rate of pay when a flat sum bonus is involved: Employers must divide the employee’s total compensation by the employee’s non-overtime hours worked (not by the total hours worked).

The Court reasoned that a flat sum bonus is not tied to the number of hours worked – the $15 will be paid when an employee picks up a weekend shift, regardless of how many hours the employee worked that week. Because the flat sum bonus was payable even if the employee didn’t work overtime, only the non-overtime hours should be considered when calculating the regular rate of pay.

The Court also based its ruling on two other policy factors:

  • California law requires premium overtime pay which is meant to discourage employers from imposing overtime work.
  • California labor laws are interpreted liberally in favor of worker protection.

The Court also decided that this ruling should apply retroactively, not just going forward.

This decision is limited to flat-sum bonuses, but we may see employees argue that it should apply to other types of extra compensation.

We strongly urge employers who want to give “extra pay” to hourly workers should consult legal counsel.

Second Article Printed in Progressive Dairyman Magazine – Marijuana Laws and You

We were again privileged to be asked to submit an article covering the new Marijuana Laws for Progressive Dairyman magazine.  You can read the article here: https://www.progressivedairy.com/topics/management/cutting-through-the-smoke-marijuana-and-the-workplace or  you can read the article in the October 18 issue.

Please feel free to leave a comment or ask questions regarding this or any HR issue.   You can always call our office at 559-625-2322 if you are a customer or would like more information.

 

ALL CALIF. EMPLOYERS BE READY FOR NEW PROP. 65 REQUIREMENTS IN 2018

California has been dealing with Prop. 65 (notice of possible Cancer causing items in use).  Well, recently we were hoping that this bill, which has been a boon to California lawyers, would be pruned and made more practical.  Instead, they have made it much tougher for almost every employer in California beginning in 2018.  There are over 800 chemicals on the present list.  Here is the list:  https://oehha.ca.gov/proposition-65/proposition-65-list .   Beginning in 2018, the old sign stating that “chemicals known to cause cancer” that  you see everywhere from every restaurant and hospital to gas stations to ball parks, will now require a sign that lists all chemicals in use at any facility.  That means barber shops to dairy farms will need to have this list posted in plain view for all people entering the property.

On its face this is absurd.  This is another example of politicians trying to show people how they are protecting us, when the reality is that no one pays attention or reads it.  As proof, how many people really read the required postings by every employer near their time clock or break room?  It is another venue for lawyers to file lawsuits against employers while not protecting anyone.

You can read a very good article regarding this story from  Joseph Perrone in the Fresno Bee.   Here is the link: https://www.fresnobee.com/opinion/opn-columns-blogs/article114970193.html

While we have time, the recent elections do not give us much hope that any sanity will return to the California State Legislature.  However, with people starting to campaign for the Governor position in 2  years, I would suggest that anytime you are confronted by any of these aspiring politicians, you ask them their stance on this issue and why.  It may provide some attention and action to make this proposition more practical.

 

New Food Service Rules for California Restaurants

From the California Restaurant Association:
New law: No bare hand contact with ready-to-eat foods

Beginning Jan. 1, 2014, a new section (113961) of the California Retail Food Code will prohibit bare hand contact with ready-to-eat foods. The new requirement will make the use of gloves or utensils mandatory whenever ready-to-eat foods are handled.

Many local health departments have not yet provided any guidance documents and it is widely expected that this new law will have a soft rollout for enforcement, allowing more time for health department outreach and operator compliance.

The California Restaurant Association (CRA) will keep restaurant operators apprised of details as they become available. The Sacramento County Environmental Management Department has released the guidance below and it is expect that this guidance will be similar to what other local health departments will use:

Background

The National Advisory Committee for Microbiological Criteria for Foods has identified three interventions that are effective in preventing the transmission of foodborne viruses and bacteria in food facilities:
•Restricting ill employees from working with food (already in code).
•Using proper hand washing procedures (already in code).
•Preventing bare hand contact with ready-to-eat food (2013 code addition).

Specific requirements

“…(b) Except when washing fruits and vegetables, as specified in Section 113992 or as specified in subdivisions (e) and (f), food employees shall not contact exposed, ready-to-eat food with their bare hands and shall use suitable utensils such as deli tissue, spatulas, tongs, single-use gloves, or dispensing equipment.

(c) Food employees shall minimize bare hand and arm contact with exposed food that is not in a ready-to-eat form.”

How do I comply?

Foodservice workers must wear disposable gloves or use utensils to handle ready-to-eat foods.

What is a ready-to-eat food?

A ready-to-eat is food is in a form that is edible without requiring additional preparation to be safe to eat. These foods include, but are not limited to:
•any food that will not be thoroughly cooked or reheated (165F) before it is served
•any food item that has already been cooked
•prepared fresh fruits and vegetables served raw or cooked
•salads and salad ingredients
•fruit or vegetables for mixed drinks
•garnishes, such as lettuce, parsley, lemon wedges, pickles
•cold meats and sandwiches
•raw sushi fish and sushi rice
•bread, toast, rolls, baked goods.

Handling ready-to-eat foods

Food employees can handle ready-to-eat foods by using any of the following utensils: tongs, forks, spoons, bakery or deli wraps, wax paper, scoops, spatulas, dispensing equipment or single-use disposable gloves.

Single-use disposable gloves

Gloves may be used to handle ready-to-eat foods. However, gloves must be changed often. One pair of gloves may only be used for one task, used for no other purpose and must be discarded when damaged or soiled, when interruptions in food handling occur or when changing from one type of food to another. Gloves also must be changed every time hands are washed.

Hand washing

Foodservice workers are required to thoroughly wash hands using soap and warm water whenever hands or gloves are contaminated including but not limited to:
•When entering the food preparation area
•Before putting on clean single us gloves and between glove changes
•Immediately before engaging in food preparation
•Before dispensing, serving food, or handling clean tableware and service utensils
•After using the toilet room
•After touching any bare part of the body other than clean hands and arms
•After coughing, sneezing, blowing nose, using tobacco, eating or drinking
•After caring for a service animal or touching shellfish/ crustaceans in display tanks
•During food preparation to remove soil/contamination and prevent cross-contamination
•When changing tasks – between handling raw foods and ready to eat foods

Exceptions

In accordance with CalCode section 113961(f) food employees not serving a highly susceptible population may contact ready to eat foods if certain practices are followed, including pre-approval from local County health departments. The application for approval includes identification of foods touched by bare hands, documentation of employee training in proper hand washing, prevention of cross-contamination, a written health plan and documentation that employees use added measures to prevent contamination.

For more information on this option, contact local health department officials.