Are elected officials, board members and appointed officials required to take mandatory sexual harassment prevention training?

Q:     Are elected officials, board members and appointed officials required to take mandatory sexual harassment prevention training?

A:     Maybe.   This is an open question.  Mandatory sexual harassment training is required for all supervisors that are employed either with a private company that has over 50 employees or for public agencies.  This training is often referred to as AB 1825 training.  Specifically, the statute states:

. . .  an employer having 50 or more employees shall provide at least two hours of classroom or other effective interactive training and education regarding sexual harassment to all supervisory employees who are employed as of July 1, 2005, and to all new supervisory employees within six months of their assumption of a supervisory position.

Based on the plain reading of the statute, elected officials, board members and appointed officials are at least arguably supervisors and can direct other employment decisions.  This would seem to indicate that they are required to take the training.  That said, often times, these individuals, particularly board members, are not considered employees.  AB 1825 applies to supervisory employees.  This would seem to suggest that at least some of these individuals are not required to take the training.

The Department of Fair Employment and Housing (DFEH) has weighed in on this issue.  As you may recall, Bob Filner (former mayor of San Diego) got into trouble for sexual harassment.  In the wake of that scandal the DFEH required all elected officials to attend AB 1825 training.  This prompted the DFEH director to state, “[t]his agreement serves as a model for other local government agencies to fully comply with the sexual harassment training required of all supervisors, including elected and appointed official under the Fair Employment and Housing Act.”

Based on the director’s comment, the DFEH has taken the position that elected officials, board members and appointed officials are required to attend AB 1825 training.  Unfortunately, the law itself is less clear.  Ultimately, there is no harm in requiring the training (except for the potential gripes about a 2 hour training requirement.)

Notwithstanding the above, the real reason an organization should require training (besides hopefully preventing sexual harassment in the first instance) is to provide the argument that the organization took all reasonable steps to prevent harassment in the defense of a harassment suit.  This argument is helpful even if an organization wasn’t technically required to comply with AB 1825.

For those elected officials, board members and appointed officials that have other employment, in addition to their public service, there may be a way to avoid taking the training in both capacities.  The applicable regulations provide the following to prevent duplication:

A supervisor who has received training in compliance with this section within the prior two years either from a current, a prior, an alternate or a joint employer need only be given, be required to read and to acknowledge receipt of, the employer’s anti-harassment policy within six months of assuming the supervisor’s new supervisory position or within six months of the employer’s eligibility. That supervisor shall otherwise be put on a two year tracking schedule based on the supervisor’s last training. The burden of establishing that the prior training was legally compliant with this section shall be on the current employer.

In general, it is always better to be safe than sorry, and training is fairly easy to complete.  There are a number of attorneys (including Baker Manock & Jensen), human resource companies and on-line services that provide the training.

FACT CHECK: Is it true that “Valley employers no longer have to worry about defending themselves against lawsuits related to errors on wage statements”?

Q.     I saw the headline stating, “Governor signs bill to protect employers from ‘frivolous’ lawsuits.” Is it true that “Valley employers no longer have to worry about defending themselves against lawsuits related to errors on wage statements”?[1]

A.     Not really.  AB 1506 simply amends Labor Code section 2699, otherwise known as the Private Attorney General’s Act or “PAGA”, but does not prevent a plaintiff from suing for the same “frivolous” violations. PAGA allows an employee to stand in the shoes of the Labor and Workforce Development Agency (“LWDA”) to bring an enforcement action on behalf of him or herself and other similarly situated employees based on violations of the California Labor Code.  The PAGA recovery is limited to the penalties that could be recovered by the LWDA and does not include other damages that would otherwise be provided directly to an aggrieved employee.  The employees are able to retain 25%  of the recovered PAGA penalty while the remaining 75% of the PAGA penalty must be remitted to the Labor and Workforce Development Board.  PAGA provides a cure provision for some, but not all, Labor Code violations. In those instances, if an employer can cure the violation within 33 days, the plaintiff is precluded from filing a PAGA lawsuit.  The new law (i.e., AB 1506) simply adds a provision to PAGA that states that certain wage statement violations can be cured.

While this is a positive development, it is not much of win for employers because it only amends PAGA and not the underlying Labor Code statute regarding wage statements. In other words, while a plaintiff may be limited in its use of a PAGA cause of action for errors related to wage statements, there is nothing prohibiting a plaintiff from simply alleging a violation of the statute that creates the wage statement requirements in the first place (i.e., Labor Code section 226).  Indeed, PAGA causes of action are rarely alleged by themselves because they are limited to penalties and even those limited penalties must be shared with the LWDA.

Based on the above, it is clear that a plaintiff does not need PAGA to bring a claim. The underlying statute (i.e., Labor Code 226) still provides an avenue for the same frivolous lawsuits.  Specifically, Labor Code section 226(e) provides:

An employee suffering injury as a result of a knowing and intentional failure by an employer to comply [with wage statement requirements] is entitled to recover the greater of all actual damages or fifty dollars ($50) for the initial pay period in which a violation occurs and one hundred dollars ($100) per employee for each violation in a subsequent pay period, not to exceed an aggregate penalty of four thousand dollars ($4,000), and is entitled to an award of costs and reasonable attorney’s fees.

….

(B) An employee is deemed to suffer injury for purposes of this subdivision if the employer fails to provide accurate and complete information as required by any one or more of items (1) to (9), inclusive, of subdivision (a) and the employee cannot promptly and easily determine from the wage statement alone one or more of the following:

(i) The amount of the gross wages or net wages paid to the employee during the pay period or any of the other information required to be provided on the itemized wage statement pursuant to items (2) to (4), inclusive, (6), and (9) of subdivision (a).

(ii) Which deductions the employer made from gross wages to determine the net wages paid to the employee during the pay period. Nothing in this subdivision alters the ability of the employer to aggregate deductions consistent with the requirements of item (4) of subdivision (a).

(iii) The name and address of the employer and, if the employer is a farm labor contractor, as defined in subdivision (b) of Section 1682, the name and address of the legal entity that secured the services of the employer during the pay period.

(iv) The name of the employee and only the last four digits of his or her social security number or an employee identification number other than a social security number.

In sum, a plaintiff does not need PAGA to bring the same frivolous wage statement lawsuits as before the new law. Labor Code section 226 can be brought without asserting a PAGA claim.  Moreover, Labor Code section 226 claims can be brought as a class action or in an individual capacity.  These claims also provide for attorneys’ fees to a prevailing plaintiff. While, there is no doubt that PAGA is a real issue for employers and any limitation in its use is a positive development, employers need to realize that the new law does not protect them from frivolous lawsuits.  This new law merely removes one small arrow in the plaintiff’s counsel’s quiver of many.

[1] http://www.thebusinessjournal.com/news/legal/20098-governor-signs-bill-to-protect-employer-from-frivolous-lawsuits

Lawyer-up! What is an employer’s obligation to provide an attorney to an employee??

Q.     Fresno Unified School District denied legal counsel to a high level administrator who is being investigated by the FBI. [1]  What is an employer’s obligation to provide an attorney to an employee in a situation like this?

A.     Whether an employer must provide a legal defense to an employee facing criminal charges is still an open question.  And, there is one rule for public employees and another for private employees.

California Labor Code section 2802, which applies to private employers, provides that an employer must indemnify its employees “for all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties . . . .”  As such, an employer may be required to reimburse an employee for the cost of the defense of a legal matter, so long as the alleged action occurred in the scope and course of the employee’s employment.  (See Grissom v. Vons Cos., Inc. (1991) 1 Cal.App.4th 52, 55.)  The “scope and course of employment” is interpreted broadly and the duty of an employer to indemnify extends even if the employee’s conduct “does not benefit the employer, even though the act is willful or malicious, and even though the act may violate the employer’s direct orders or policies.”  (Jacobus v. Krambo Corp. (2000) 78 Cal.App.4th 1096, 1102.)  Moreover, the employer must indemnify regardless of whether or not the employee is exonerated.  (Id. at 1101.)  In other words, the key question is whether the employee’s wrongful conduct was committed during the performance of her employment – not whether a wrongful act was committed.

The above question is complicated, however, because courts disagree on two critical components that would make it clear whether or not an employer must provide an attorney to an employee in a criminal proceeding.  First, it is unclear whether an employer must provide an attorney (on the front end) or simply reimbursement for the cost of an attorney (on the back end).  In Jacobus, the court found that “[Section 2802] requires the employer not only to pay any judgment entered against the employee for conduct arising out his [or her] employment but also to defend an employee who is sued for such conduct.” (Jacobus v. Krambo Corp., supra, 78 Cal.App.4th at 1100.)  On the other hand, in Grissom, the court notes that “[s]ection 2802 does not say that an employer must ‘defend’ an employee . . . .[but only that] if that expenditure is necessarily in direct consequence of the discharge of the employee’s duties, then the employer must ‘indemnify’ (i.e. reimburse) the employee.” (Grissom v. Vons Cos, Inc., supra, 1 Cal.App.4th at 57-58.)

The second  question is whether or not Section 2802 even applies to criminal proceedings at all or whether it is applicable to only civil actions.  In this regard, a California Court of Appeal, has flatly stated that “[t]here have been no California cases reaching the issue, and it appears to be an open one.” (Los Angeles Police Protective League v. City of Los Angeles (1994) 27 Cal.App.4th 168, 177.)

If it is ultimately determined that an employee’s actions, even if found to be wrong, were done in the course and scope of employment (and not in the employee’s personal capacity) an employer will likely be required to at least indemnify the employee for the cost of an attorney, if not be required to provide counsel.  But, where there is a criminal investigation and it is not a civil matter, it is unclear as to whether an employer is even required to indemnify or defend at all.  What is clear, however, is in the end, if the employee files a claim against an employer  for indemnification and wins, that employee will not only be entitled to be reimbursed for attorneys’ fees in the underlying criminal action, but also in the indemnification lawsuit against the employer.  This makes sense because Section 2802 includes reimbursement for “all reasonable costs, including, but not limited to, attorney’s fees incurred by the employee enforcing the rights granted by this section.” (Lab. Code § 2802(c).)

And, while there is one rule for private employers, there is yet another rule for public employers.  Some courts have assumed that section 2802 applies to public employees.  However, California courts have found that reimbursement of defense costs for public employees is governed exclusively by the Government Claims Act.  The Government Claims Act also provides that the employer has to indemnify similar to the requirement of section 2802, but provides a notable exception where the employee acted with fraud, malice or corruption.  Another exception to an public entity’s requirement to indemnify exists where the public entity is bringing an action against its own employee.  Also, Government Code 995.8 specifically discusses providing a defense in a criminal action.  That Code provision notes that the public entity may provide a defense in a criminal action “if:  a) The criminal action or proceeding is brought on account of an act or omission in the scope of his employment as an employee of the public entity; and b) The public entity determines that such defense would be in the best interests of the public entity and that the employee or former employee acted, or failed to act, in good faith, without actual malice and in the apparent interests of the public entity.”

[1] http://www.fresnobee.com/news/local/education/article42958392.html