Good morning, and welcome to my latest Monday Morning Briefing. Hope your month of July is off to a good start, and you have all remembered to increase your minimum wages and mileage reimbursement, and implement your new leave policies as applicable (that last one means YOU, West Hollywood!)
THE RETURN OF COVID
Surprise! The pandemic isn’t really over. But we knew that, didn’t we? Los Angeles County has announced that it is on the brink of reinstituting its mask mandate due to the recent surge of the latest COVID-variant. I believe NYC is the same position. These health departments are driven by metrics, and if either their case or hospitalization percentages start running too high per 100,000 people over a ten day period, the CDC places these metro areas in a high alert range. That triggers certain preventative measures to go back into effect, like mask wearing for certain indoor venues. Yes, it will be a pain if it happens, but hopefully it would be short-lived.
Remember when I likened this pandemic to living through never-ending aftershocks? I’m just keeping my mask in my purse for the indefinite future, like I kept reattaching my breakables with earthquake putty. Breathe, everyone, just breathe.
RESPONSIBLE BEVERAGE SERVICE “RBS” – EFFECTIVE JULY 1
There are enough hospitality-related employers here, so I wanted to touch on this very hot issue. Effective July 1, our friends at the California Department of Alcoholic Beverage Control (ABC) put into effect the long awaited “RBS” laws, requiring employees who handle alcohol to undergo special classes and receive a certification. Managers who handle alcohol need to get a special certificate. The FAQs on the website were almost intentionally vague about who should pay for the cost and time for these classes. But notwithstanding that ambiguity, our firm has researched this issue over the years, and it is pretty clear that when the state or federal government mandates licensure, training or certificate for an industry, the employer does NOT have to pay for the cost or time for the employee to receive that licensure, training or certificate. This is not something required by you, as the employer. And it is something that the employee can take from job to job.
Distinguish this, for example, from harassment training, which is mandated to be provided BY THE EMPLOYER. There, because the state is requiring the employer to provide the training, the employer must pay for the training. The ABC could have done that here. It did not. The requirement is for the individuals to obtain the training, NOT for the on-premises providers to ensure that all of its employees have this certificate by a certain date. Again, if that were how it were worded, the requirement would be different, and the certificates would be held by the location, not by the individual beverage server. The ABC clearly wants to put the accountability on the beverage SERVER, not on the employers. Therefore, it is my conclusion (and that of the California Restaurant Association), that the employers need not pay for this.
However, keep in mind that this is a competitive market, and many larger restaurant groups WILL be paying this cost for their employees. Also, it does not appear to be that difficult to become trained to do this training, and larger groups may want to have their in-house folks become certified trainers for the long term.
THE MYTH OF AT-WILL EMPLOYMENT
Now that the PAGA lawyers are scrambling to recover after the Viking River Cruises decision, in the last few weeks, I have started to see a new flurry of demand letters and claims focusing on good old fashioned wrongful termination and discrimination cases. It actually feels good to be back in the saddle again. So I am dusting off some of the advice I have given over my past 37 years, surprised to find I have a whole new crop of clients who haven’t heard my pitch on these issues before. I actually wrote an article for the Los Angeles Daily Journal in the late 90’s entitled “The Myth of At-Will Employment,” and did a series of seminars with that title, way before we saw the surges of class action, PAGA and other wage and hour cases. Because this issue has come up three times in the last ten days with various clients, I thought it would be worth mentioning here.
“At-will employment” was an important defense to the claim of an implied contract for good cause, a cause of action we used to see in the mid-80s when I first started practicing law, and a cause of action we pretty much never see now in employment cases. Why? First, because it is easily defeated adding “at-will” clauses to your handbook or application, which since the Foley v Interactive Data case in 1980s now everyone does. But more importantly, while “at-will employment” says that you can be fired for “no reason,” you still can never fire someone for a WRONGFUL REASON. And if you give no reason for the termination, you have left this wide gaping hole for the employee to come back with one of California’s many, between the Government Code’s “protected categories” listed in the Fair Employment and Housing Act, to the protections under the Labor Code, to the whistleblower protections from case law, and then there are a bunch of federal ones from statutes like the NLRB and OSHA. Most of those have far greater damages, like emotional distress, punitive damages, sometimes double damages, and many add attorneys’ fees.
And yet, I spoke with a new client this past week who actually told me that their “other lawyer” had told them not to give a departing employee a reason for the termination, because the employee was “at-will.” I only wish people could see me face palm every time I hear that phrase.
Whenever you terminate an employee without a reason, or you tell the employee “it’s just not working out,” or “it’s not a good fit,” or “it’s the end of the probationary period,” or “it’s a layoff” (when it ISN’T a layoff and they are the only employee being terminated) – you open the door for the employee and their attorney to come back with any one or more of those “wrongful reasons” and supply the end of the story that you did not. And now, you are stuck. You are stuck with the “non-story” that you just gave. And you probably had a great reason for why you terminated that employee, but now you can’t tell it, because you will look like you are making it up after the fact. And why didn’t you give it? You just didn’t want to get into it. Didn’t want to bother. It was easier just to say “layoff” or “not a good fit” or “end of probation.”
Now, here is why those other attorneys do not want you to give a reason for the termination. They do not trust you. They think you will say the wrong thing. I know you better than that. Because you will call me, and we will walk through this together, if necessary. But transparency is the key. Because employees know when you are lying, and they know when you are avoiding them. And that causes anger. And anger causes them to go to lawyers in the first place. If you tell them the truth, they may not agree. They may even want to argue with you, a bit. But that little bit of pain is worth avoiding years of litigation. And more often than you think, they will at least understand and appreciate that you are telling them what you believe. And if you put it in writing, and they take it to their lawyers, the lawyer gets to see YOUR story before that lawyer ever gets invested in the case. And the other nine people in that waiting room don’t have termination letters explaining the reasons for their terminations. Guess whose case they take?
Your other lawyer figures they can present what really happened to a jury and convince them the real reason for the termination. They figure that’s how they will win. But you don’t win cases in front of a jury, or even an arbitrator. You win cases by avoiding litigation. I know for a fact that strong termination letters, citing the reason(s) for termination, help us defeat litigation before it starts.
Okay, that’s my takeaway for this week. It’s still squirrely out there, and the COVID numbers are rising, so take care with your mental and physical health my friends. Check in with those around you, too. And my new house is coming along, so if you are in the Laurel Canyon area and need a break, stop by for coffee or drink on the patio while these summer nights are still long.
#StandWithUkraine