Good morning, and welcome to the latest edition of my Monday Morning Briefing, and we continue to pray for peace in the Ukraine.
NOT MUCH IS CHANGING IN COVID NEWS, BUT LOOK OUT FOR A POSSIBLE OSCAR SURGE
All remains eerily quiet on the COVID-19 front. As you recall, the Los Angeles City Council members voted 12 – 0 in early March to drop the ordinance that required many indoor venues to check the vaccine status of patrons, and we all expected that change would go into effect by now. Well, it hasn’t, and yet, most indoor restaurants and other venues I have frequented have just stopped enforcing it. But the law is still in effect. It’s almost as if Los Angeles is not quite ready to remove its last COVID restriction, for fear it might just have to turn around and reinstate it again. The numbers in Los Angeles and around the state remain low, but there are rumblings of another variant on the horizon in Europe. Indeed, at this past weekend’s BAFTAs, London’s equivalent of the Academy Awards, a number of celebrity attendees reported positive cases of COVID, and there is talk that the event could be labelled a “super-spreader.” Indeed, there are rumors that the award show’s viral proclivities could impact the Oscars, set to take place this Sunday at the Dolby Theatre in Hollywood.
WAGE & HOUR PRIMER: SECTION 2802 + CELL PHONES
Last week, we talked about California Labor Code Section 2802 and how that requires employers to pay for out of pocket gas costs. And I promised you that this week, we would talk about cell phones. So here we are.
Labor Code Section 2802 requires that employees be reimbursed for all reasonable expenses they incur during employment. Cell phones used to be tricky issues with employers. It was clear when an employer HAD to use a cell phone for work, then the employer knew they had to pay. But what if the employee just chose to use their cell phone. Or what if customers or clients routinely called the employee on the phone. Or the employee started using that phone for emails at home. Maybe the employer didn’t ASK the employee to use that phone. But we all knew that was how the employee was doing the work. And let’s face it, most of the time, when we reached out to the employee, we knew the employee was calling us or texting us back on that cell phone.
But we also knew that the employee was using that cell phone for personal matters as well. And for decades now, most employees didn’t pay by the call – they all had these flat rate plans. So they really weren’t out of pocket anything for the extra usage, like they had been back in the 90s when cell phones first came on the scene. So maybe, we were good if these employees just kept on using their phones and we employers looked the other way?
Well, all that changed with the California Appellate Court case of Cochran v Schwan Home Service, in 2014. The Cochran court essentially said that the test was not about whether the employee was out of pocket additional money by using their own phone; rather, whether the employer was saving money by having the employee using their phone and not having to bear the burden of providing company phones. And that was really it. Instead of supplying company cell phones for these employees, the employees simply used their own. It was a windfall for all these employers. And, of course, it has been. And because of that, the employer has to pay SOME percentage of the employee’s flat rate. How much? It depends on how much the employee uses that phone for work.
So let’s start with the fundamental question of when do you have to reimburse your employee for phone use? Again, not for usage that is “incidental” to work, like occasionally calling in sick. But let’s use me, for example. The vast majority of calls my clients make, they make to my cell phone, even before the pandemic. That’s partly because many of you have known me from previous law firms. That is an example of work-related cell phone use. Using the phone for email use is the same. If YOU are calling or texting or emailing your managers or employees on their phones, or your clients are, then it’s work-related use. But it doesn’t stop there. How many of you have your employees use work-related apps, such as HotSchedules? I know, you all claim that the use of these apps are “voluntary,” but to the extent you send out important company information through these apps, they have become much more than that. I will also remind you that HS charges $2.99 to your employees to download! I have seen class actions on just this issue. What other apps do they use? ADP? Paychex? Slack? Group chats? Temperature checks for COIVD? What about punching in and out for their time?
Nothing is wrong with doing ANY of the above – as long as you compensate your employees for the usage for this phone. AND, by the way, for the time they spend on this phone for whatever work they are performing. (That will be the subject of another Briefing). How much do you have to pay? If they are just using it to clock in and out, or send a few texts, it could be as little as a few dollars a week or $15 a month. If they are on it like I am all day and month, then it should be substantial, more like $75 – $100 a month. And if it hasn’t been obvious, this does apply to exempt employees as well. In fact, your managers are usually the ones who have this greatest expense.
Cell phone expenses, like gas expense and other 2802 issues, are regular PAGA button pushers. We have to make sure they are handled. They come back to bite us in all these lawsuits, and they carry attorney’s fees awards when we miss them. Just pick a number, pay it, and be safe.
LAST MINUTE WEBINAR: MARCH 22, 2022 10 AM PDT CALIFORNIA EMPLOYMENT LAW UDPATE!
I know it is very last minute, but I am conducting a webinar with the folks from Push Operations tomorrow at 10am, and I believe there is still room if anyone wants to hop on. Visit this link for more information.
Next week is the Viking River Cruises oral argument, and we will have some discussion in anticipation of that.
Until then, stay safe and have a good week.
#StandWithUkraine
#Hamantaschen_for_Ukraine