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A Post-Brinker Victory for Employees: Bradley v. Networkers International, LLC

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In the aftermath of the California Supreme Court’s landmark decision in Brinker Restaurant Corp. v. Superior Court(2012) 53 Cal.4th 1004 (Brinker), employers and non-exempt employees are still hashing out the implications of the clarified meal and rest period requirements.  In April, Bryan Schwartz Law discussed the implications of that case on this blog, which can be found here: California Supreme Court’s Long-Awaited Brinker Decision.

 

Last week, in Bradley v. Networkers International, LLC (December 12, 2012)  —Cal. Rptr.3d —, 2012 WL 6182473, the California Court of Appeal in San Diego addressed a common problem in meal and rest period cases: where an employer has no compliant meal and rest period policies that are distributed to employees. This case makes clear that a lack of a meal or rest period policy can provide sufficient commonality for class certification, which is a significant victory for plaintiffs.

Background

While the Brinker case was pending, a number of cases appealed to the Supreme Court were granted review and held, pending the decision in Brinker.  Among the cases relegated to judicial limbo was Bradley v. Networkers International, Inc. (Feb. 5, 2009, D052365). In Bradley, three plaintiffs filed a class action complaint against Networkers International, LLC, alleging violations of California’s wage and hour laws including nonpayment of overtime and failure to provide rest breaks and meal periods. The plaintiffs moved to certify the class, which requires that they “demonstrate the existence of an ascertainable and sufficiently numerous class, a well-defined community of interest, and substantial benefits from certification that render proceeding as a class superior to the alternatives.” Brinker, 53 Cal.4th at 1021. The court determined that the plaintiffs did not demonstrate that common factual and legal questions would predominate over the individual issues and denied class certification. The plaintiffs appealed, but the decision was upheld by the California Court of Appeal. 

Plaintiffs appealed to the California Supreme Court, which granted petition for review but held the case for over three years until Brinker was resolved. After issuing their decision in Brinker, the California Supreme Court remanded Bradleyto the California Court of Appeal, Fourth Appellate District, with directions to vacate its decision on class certification and reconsider the case in light of the Brinker decision.

Before getting to the recent decision from the Fourth Appellate District, a little background is useful. A common fight between employers and employees arises when an employer classifies its employees as “independent contractors,” as opposed to employees. True independent contractors have control over the terms and conditions of their employment and are not subject to California wage and hour protections including overtime and meal and rest periods. Employees, on the other hand, remain under their employer’s control during their working hours and are protected by California’s wage and hour laws. The employee versus independent contractor issue has been a battleground for years in the employment law arena and California courts have developed numerous criteria to assess whether an individual is truly an independent contractor or an employee.

In the recent Bradley case, the three plaintiffs alleged that they were misclassified as independent contractors, and should instead have been treated as employees. All three of the plaintiffs worked for Networkers. Each of the plaintiffs was required to sign an “independent contractor agreement,” which stated that each was an independent contractor rather than an employee. As such, plaintiffs did not receive overtime pay or meal or rest periods. However, contrary to the terms of the agreement, the plaintiffs alleged that they were treated as employees and were subject to the same employment policies.

Networkers argued that plaintiffs’ motion to certify the class should be denied because the case did not involve common questions of fact or law, and therefore, resolution of the case would require mini-trials for each plaintiff. Although the court agreed with Networkers on the first go-around, after the Brinker decision, the court agreed with plaintiffs on all but one cause of action. 

The Court of Appeal’s Decision on Remand

Because Networkers applied consistent companywide policies applicable to all employees regarding scheduling, payments, and work requirements, those policies could be analyzed on a class-wide basis. The court would not need to assess them with respect to each potential class member. In analyzing whether class certification was appropriate the court noted that, “[t]he critical fact is that the evidence likely to be relied upon by the parties would be largely uniform throughout the class.” The court held that the factual and legal issues related to the independent contractor issue would be the same among the plaintiff class members, and therefore appropriate for class treatment.
 
Moreover, in Bradley, as in many workplaces, the employer did not have a policy actually distributed to employees that provides for meal and rest periods. Networkers argued that Brinker was not controlling, in its guidance about meal and rest requirements, because in Brinker the plaintiffs challenged an express meal and rest break policy whereas in Bradley, the plaintiffs were arguing that the employer’s lack of policy violated the law. The Court rejected this argument, holding: “This is not a material distinction on the record before us. Under Brinker, and under the facts here, the employer engaged in uniform companywide conduct that allegedly violated state law.” Bradley, 2012 WL 6182473 *13. The Court noted that plaintiffs had presented evidence on Networkers’ uniform practice and that Networkers acknowledged that it did not have a policy and did not know if employees took meal or rest breaks. In assessing the lack of evidence presented by Networkers and relying on Brinker, the Bradley Court held: “Here, plaintiffs’ theory of recovery is based on Networkers’ (uniform)  lack of a rest and meal break policy and its (uniform) failure to authorize employees to take statutorily required rest and meal breaks. The lack of a meal/rest break policy and the uniform failure to authorize such breaks are matters of common proof.” Bradley, 2012 WL 6182473 *13.

The Bradley decision disposes of a significant hurdle in wage and hour cases by holding that this type of scheme – where no policy is distributed to provide for meal and rest periods- can meet the commonality requirement for class certification. For example, Bryan Schwartz Law is currently representing a group of restaurant workers who were not aware of a meal/rest period policy, and who were not provided with meal or rest periods. In the Bryan Schwartz Law case, there was no policy that provided the workers with coverage to enable them to take their breaks. Under Bradley, certification is appropriate to test, class-wide, whether the employer’s lack of a well-defined policy or practice of providing meal/rest periods violated the Labor Code. 

Although several meal and rest period cases have been decided adversely to workers post-Brinker, the Bradley court determined that each of those cases was distinguishable.  In distinguishing Lamps Plus Overtime Cases (2012) 209 Cal.App.4th 35, the Bradley Court of Appeal noted that it was undisputed that the Lamps Plus employer’s written meal and rest period policy was consistent with state law requirements and that the violations differed at each store and with respect to each employee. Similarly, the Bradley court held that Hernandez v. Chipotle Mexican Grill, Inc. (2012) 208 Cal.App.4th 1487 was distinguishable because the only evidence of a company-wide policy or practice was Chipotle’s evidence that it provided meal and rest breaks as required by law. Likewise, Bradley distinguished Tien v. Tenet Healthcare Corp. (2012) 209 Cal.App.4th 1077, noting that in that case there was “overwhelming” evidence that meal periods were made available and the employer’s liability with respect to each employee depended on issues specific to each employee. Brookler v. Radioshack Corp. is an undecided case that was remanded after Brinker involving wage and hour class certification, which may provide additional clarification on these issues.

The court also rejected Networkers’ argument that because each plaintiff would be owed a different amount of damages, the case should not be certified. Relying, in part, on the concurring opinion in Brinker, the court held that even where plaintiffs are required to individually prove damages, individualized damages inquiries do not bar class certification. The court also reversed its prior decision and determined that class certification on the issue of overtime was appropriate because, assuming the plaintiffs were employees, proof of damages could be determined from the common proof of the pay records.

Although the court decided to remand the off-the-clock work issue, it did so because the factual record did not show that there was a uniform policy requiring each employee to work off the clock.

About the Author: Bryan Schwartz is a practicing attorney. If you believe you have been mis-classified as an independent contractor, have meal and rest period claims, or have questions about other wage and hour violations, contact Bryan Schwartz Law (www.BryanSchwartzLaw.com). Nothing in the foregoing commentary is intended to provide legal advice in a specific case or to form an attorney-client relationship with any reader. You must have a representation agreement with Bryan Schwartz Law to be a client of this firm or author.

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Walmart Tells Workers Who Ask About Unions That Benefits And Vacation ‘Might Go Away’

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Walmart staves off unionization attempts in its stores by telling workers who ask about forming a union that they may lose benefits and vacation time, a potential violation of American labor law that could further inflame relations between the company and workers who picketed its stores on Black Friday and have been attempting to organize.

Walmart workers and labor advocates held protests outside the chain’s stores throughout Thanksgiving weekend, protesting the low wages it pays its workers. The company, which paid its chief executive $18.1 million and made $15 billion in profits last year, has fought off union attempts before, and now it tells its workers that unionization could lead to the loss of bonuses and vacation time, a spokesperson told Bloomberg BusinessWeek:

Walmart has been opposed to unions since Sam Walton opened his first store in Rogers, Ark., in 1962. These days, “we have human resources teams all over the country who are available to talk to associates, and we will get questions about joining a union,” says David Tovar, a spokesman for the company. “We would say: ‘Let us remind you of all that Walmart offers, and of what might go away. Quarterly bonuses might go away, vacation time might go away.’?”

Such tactics may not be illegal by themselves because they can be seen as predicting outcomes rather than threatening them, The Nation’s Josh Eidelson reported today. But the implication of such a “prediction” — that joining a union could be followed by actions resembling retaliation — is quite clear. Walmart’s anti-labor practices aren’t new: in 2008, the store’s workers spoke out about anti-union meetings they were forced to attend.

Though Walmart has long fought organization efforts in the United States, it sometimes letsworkers in other countries unionize — particularly when unionization is contingent on Walmart getting to enter a new country. In the U.S. though, it has responded to unionization efforts byshutting down departments, fighting legislative improvements to labor law, and now, telling workers that joining a union may cost them their bonus.

This post was originally posted on December 17, 2012 on ThinkProgress. Reprinted with Permission.

About the Author: Travis Waldron is a reporter/blogger for ThinkProgress.org at the Center for American Progress Action Fund. Travis grew up in Louisville, Kentucky, and holds a BA in journalism and political science from the University of Kentucky. Before coming to ThinkProgress, he worked as a press aide at the Health Information Center and as a staffer on Kentucky Attorney General Jack Conway’s 2010 Senate campaign. He also interned at National Journal’s Hotline and was a sports writer and political columnist at the Kentucky Kernel, the University of Kentucky’s daily student newspaper.


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America Holding Walmart’s Feet to the Fire

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Finally, someone is holding Walmart directly accountable for the abuse of workers in its contracted warehouses. “Recent discovery has established that Walmart bears ultimate responsibility for the violations of state and federal law committed against plaintiff warehouse workers,” said a court document filed in Los Angeles.  

Walmart Targeted In Warehouse Worker Lawsuit – Huffington Post  

“Wal-Mart employs a network of contractors and subcontractors who have habitually broken the law to keep their labor costs low and profit margins high. We believe Wal-Mart knows exactly what is happening and is ultimately responsible for stealing millions of dollars from the low-wage warehouse workers who move Wal-Mart merchandise.”

Warehouse Workers Sue Wal-Mart for Back pay and Damages – ABC News/Univision 

Corporate Welfare: instead of taking a small partition of their record profits, or slightly cutting CEO pay to help out their workers, Walmart wants YOU, the taxpayer, to pay for its workers’ healthcare. Just one more reason Walmart workers, and the population at large, are standing up to Walmart. 

Walmart Wants Taxpayers to Pick Up Health Care Costs – Truth Dig

Walmart wants you to think its workers love the store and love their jobs. If that’s the case, why are there unprecedented protests against the mega retailer spanning the country? Why is the store facing a lawsuit from contracted warehouse workers? Since Walmart has given us no real evidence that its workers love the store, maybe we are just supposed to take Walmart’s word for it? 

Walmart Wants You To Know That Their Workers ‘Love Their Jobs’ – Huffington Post

This post was originally posted on Change to Win on Monday, December 3, 2012. Reprinted with Permission.

About the Author: J Lefkowitz: Change to Win is a Strategic Organizing Center which focuses on using its “strength in numbers to reclaim the American Dream.” It’s target is middle class and working class Americans to hold corporations  and other large entities in our modern society accountable. You can learn more about Change to Win here.


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“Wal-Mart is Not a Feudal Manor”

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The manager at the Southside Walmart in Paducah, Ky., might have figured he’d quashed the protest at his store.

After all, he made James Vetato and three other OUR Walmart picketers leave from near the front door.

The quartet retreated, but to regroup at the entrance road to the busy shopping center the Walmart store anchors.

They redeployed under a big blue and white Walmart sign and held up hand-lettered placards reading, “ON STRIKE FOR THE FREEDOM TO SPEAK OUT,” “RESPECT ASSOCIATES DON’T SILENCE ASSOCIATES,” “ULP [unfair labor practice] STRIKE” and “WALMART STOP BULLYING ASSOCIATES WHO SPEAK OUT.”

Vetato, his wife, Trina, Rick Thompson and Amber Frazee were among many members of Organization United For Respect at Walmart — “OUR Walmart” for short — who struck and walked picket lines at stores in a reported 100 cities and towns in 46 states on Thanksgiving night and on Black Friday, the busiest shopping day of the year.

The group, which numbers thousands of current and past Walmart employees across the country, wanted to focus national attention on Walmart’s abuse of its workers, Vetato said.

The world’s richest retailer, Walmart is known for paying low wages to its employees, called “associates.” In addition, Walmart is fiercely anti-union.

Said Trina Vetato:

“People honked and waved to show their support, and they slowed down to read the signs. Some people stopped and told us they supported what we were doing.”

Vetato works at the Southside store. Her husband did, too, until he said management drove him to quit.

Frazee is employed at another Walmart in historic Paducah, where the Tennessee and Ohio rivers merge. She and Vetato expect retaliation from Walmart management.

“They said that there will be consequences,” Vetato said. “I’ll probably get fired or put on suspension or something. But it’s well worth it to me.”

Frazee agreed. “All we want is respect,” she said.

The Vetatos, Frazee and Thompson handed out leaflets explaining, “We are the life-blood of Walmart, yet we are not always treated with respect.”

Some of the literature outlined a “Declaration of Respect,” which nearly 100 OUR Walmart members, including James Vetato, delivered to Walmart’s top management at company headquarters in Bentonville, Ark.

The declaration calls on Wal-Mart management to

— Listen to associates.

— Respect associates and recognize their right to free association and free speech.

— Allow associates to challenge working conditions without fear of retribution.

— Pay a minimum of $13 an hour and make full-time jobs available for associates who want them.

— Create dependable and predictable work schedules.

— Provide affordable health care.

— Furnish each associate a policy manual that ensures “equal enforcement of policy and no discrimination” and affords every employee an “equal opportunity to succeed and advance in his or her career.”

The four Paducah protestors brought a cardboard box filled with OUR Walmart literature. They said management tried to keep it out of the store. Shoppers helped get it in.

“On Thanksgiving night, a community member took one of the fliers and taped it to the front of his shirt and walked through the store to get the word out to everybody,” Trina Vetato said.

Thompson, a Pittsburgh union activist, came to Paducah to join the picket line. When a member of management tried to stop him from handing out leaflets, another customer came to his aid.

Explained Thompson, a member of Vacaville, Calif.-based International Brotherhood of Electrical Workers Local 1245:

“The manager started bullying me for peacefully disseminating information, which I had the right to do. When the customer saw the manager walk away, she said ‘Give me a stack of those. I’ll take them in for you and pass them out.'”

Thompson said OUR Walmart is not trying to drive Walmart out of business. “We are not asking a single customer to turn away. We are fighting to win respect and improve working conditions for all associates.

“We want employees to have a chance to form their own association and have their own concerted actions without retaliation and unfair treatment. Walmart is not a feudal manor. The associates are not serfs. Walmart does not own every aspect of their lives.”

This post was originally posted on November 24, 2012 at Union Review. Reprinted with Permission.

About the Author: Berry Craig is a recording secretary for the Paducah-based Western Kentucky AFL-CIO Area Council and a professor of history at West Kentucky Community and Technical College, is a former daily newspaper and Associated Press columnist and currently a member of AFT Local 1360. His articles can also be featured on AFL-CIO NOW.


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Lawsuit Sheds Light on Murky and Dangerous Warehouse Sector

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Working In These Times has frequently covered the warehousing industry and the way that complicated layers of different companies using, owning, operating and staffing warehouses make the sector ripe for labor abuse.

A motion for sanctions filed August 23 in a workers’ class action lawsuit against southern California Wal-Mart warehouses sheds more light on this structure and alleges that defendant Schneider Logistics failed to provide legally mandated evidence to avoid culpability for workers’ wages and working conditions.

Last October, workers affiliated with the group Warehouse Workers United filed a class action lawsuit in U.S. district court in California alleging labor law violations at Mira Loma warehouses operated solely for Wal-Mart stores. The lawsuit names Schneider Logistics Inc. (SLI) and its subsidiary Schneider Logistics Transloading and Distribution (STLD) along with the companies Impact and Premier, which hired people to staff the warehouses. Schneider took over operation of the warehouses in 2006.

The initial complaint said:

Plaintiffs bring this action on behalf of themselves and others similarly situated to recover the wages that defendants stole — and are continuing to steal — from them in violation of federal and California law. Plaintiffs also seek redress for other consequences of defendants’ unlawful conspiracy, including defendants’ wrongful scheme to hide and then cover up the extent of their wrongdoing by failing to keep mandatory payroll records, falsifying records of hours worked and compensation owed, and concealing, denying and/or misrepresenting to the workers the amount of their earnings and on what basis these earnings were calculated.

A key question is whether Schneider or STLD directly employed–and is therefore responsible for the working conditions of–the plaintiffs, including lead plaintiff Everardo Carrillo. The plaintiffs allege that Schneider is their “joint employer” along with the other defendants.

Schneider Logistics initially argued that it had “no connection with or responsibility for the operation, oversight, or supervision” of the workers at the Mira Loma warehouses, as quoted in the recent motion. It notes that Schneider Logistics Secretary-Treasurer Amy Schilling signed a sworn declaration saying the company had “no business or contractual relationship” with co-defendants Impact and Premier. And the motion alleges that Schneider sought to continue this image by failing to turn over documents during the discovery process that would have indicated otherwise.

In April Schneider attorneys responded to a discovery request without actually looking for the requested documents, according to the motion. In other words, they allegedly were either sloppy or intentionally avoided turning over evidence to which the plaintiffs have a legal right.

This became clear when documents turned over by Impact and Premier included highly relevant Schneider documents which Schneider attorneys had specifically said did not exist. The motion notes:

Schneider has now produced thousands of documents it previously claimed did not exist, including over 12,100 pages of personnel files it maintained for the Impact and Premier class members (whom it claims not to jointly employ), and the workplace rules and training requirements it imposed on all class members.

The plaintiffs say the new documents show that “Schneider’s top managers knowingly made material false statements” to the court, including claims that the warehouse employees are not subject to Schneider employment policies and that Schneider does not keep personnel files on them or set productivity quotas. The documents showed that Schilling herself signed contracts with Premier and Impact, on behalf of STLD and “its affiliates.” Meanwhile, Schilling is also vice president and controller of Schneider National, the parent company of the other Schneider groups, which actually negotiated the contracts with Impact and Premier.

Once it was clear that Schneider did indeed have contracts with Impact and Premier, General Manager Vince Redgrave told the court that the contracts gave Schneider no say over work terms or conditions. The court ordered that Schneider actually produce the contracts, and when it did, as the motion says, “they proved the exact opposite of what Vince Redgrave had testified.”

The federal district judge, Christina Snyder, wrote in a preliminary injunction ruling that the “contracts dictate nearly every material term of plaintiffs’ employment including how Impact and PWV (Premier) must conduct pre-employment screening and new employment training.”

The documents also showed that, contrary to Redgrave’s previous testimony, Schneider did set specific productivity quotas for the warehouse workers and in fact complained to Premier when the rate of cases unloaded per hour dropped. Schneider officials also talked about how to remedy Impact’s “low productivity levels.”

Warehouse worker groups have long argued that unrealistic and escalating productivity quotas are among the things that lead to high chronic and acute injury rates in warehouses. In July, Warehouse Workers United filed a complaint with California’s Occupational Safety and Health Administration office.

The recent motion also alleges that Schneider or its attorneys did not order employees to preserve emails relevant to the case, as is standard required legal procedure. It says the company has an automatic delete email function for emails from the Mira Loma warehouses, meaning emails are deleted automatically after a short period of time, and employees also have “absolute discretion” over whether to save or delete emails. The motion says Schneider was slow to issue a memo instating a “litigation hold”—meaning employees should preserve relevant communications. And it alleges even after such a memo was issued, Schneider never enforced it.

The motion also alleges that Schneider destroyed and denied the existence of security camera footage that would aid the plaintiffs’ case. The motion demands that Schneider turn over video footage and also a log of any video that has been destroyed since October 2011.

The motion asks that the court make note of Schneider’s alleged misconduct, tell Schneider that further misconduct will result in sanctions, and provide relevant attorneys’ fees and costs to the plaintiffs. It notes that the court could also decide to inform a jury of Schneider’s false statements and other discovery violations, and asks that the court establish a “rebuttal presumption” that Schneider is indeed a “joint employer” of the plaintiffs.

Overall, the lawsuit is part of WWU’s and individual workers’ ongoing campaign to improve conditions in warehouses and shed light on the complicated employment structure that allows major companies like Wal-Mart to benefit from the low-paid, dangerous work of a largely temporary workforce.

This blog originally appeared in Working In These Times on September 4, 2012. Reprinted with permission.

About the author: Kari Lydersen, an In These Times contributing editor, is a Chicago-based journalist writing for publications including The Washington Post, the Chicago Reader and The Progressive. Her most recent book is Revolt on Goose Island.


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Supreme Ct. News Not All Bad for Employees This Term

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Image: David WeisenfeldIt’s no secret that the nation’s employees did not fare well in the two most highly-publicized Supreme Court rulings affecting them this term, Wal-Mart v. Dukes and AT&T v. Concepcion.  In both cases, the ability of plaintiffs to get relief as a class in the courts was curtailed.

The Wal-Mart holding will make it especially difficult for employees in differing job classifications to team together to win a class action discrimination lawsuit.  Meanwhile, the AT&T case arose not from the employment realm at all, but rather from a seemingly mundane consumer dispute.

A California couple, Victor and Liza Concepcion, claimed they had unknowingly signed away their right to initiate a class action against AT&T as part of a form agreement.  They were upset after being charged $300 for a cell phone that had been touted as free.  The Concepions argued that the arbitration clause they signed should be struck down as unconscionable because its classwide ban would leave them and other similarly-situated consumers without representation.

But just as in Wal-Mart v. Dukes, the AT&T case broke down along strict ideological lines with the five conservative justices voting to uphold the classwide ban in another 5-4 opinion.  Writing for the Court, Justice Antonin Scalia asserted that courts must place arbitration agreements on equal footing with other contracts and enforce them according to their terms.  “Requiring the availability of classwide arbitration,” he said, “creates a scheme which is inconsistent with the Federal Arbitration Act.”

While the underlying facts arose from some unhappy consumers, it does not take much of a leap to see how the holding’s language could affect employees confronted with similar arbitration agreements by their employers.  No less an authority than veteran San Francisco plaintiff’s employment attorney Cliff Palefsky has said of AT&T v. Concepcion, “There’s a potential for mischief.” He adds that the ruling is sure to extend to arbitration clauses in the employment realm.

When the Wal-Mart and AT&T opinions are coupled together, the picture at the Supreme Court from this past term may not be a pretty one for employees.  But for those willing to dig a little deeper, the term actually reveals gains for workers when it comes to workplace anti-retaliation protections.

In a trio of cases, the justices ruled decisively for employees who alleged they were the victims of retaliation under Title VII of the Civil Rights Act, the Fair Labor Standards Act and the Uniformed Services Employment and Reemployment Rights Act (USERRA).  In two of the disputes, the decisions were unanimous while the third resulted in a 6-2 victory for the plaintiff employee.

The civil rights case, Thompson v. North American Stainless, involved a Kentucky man who said he was fired from his job because his fiancé had filed an EEO complaint against their employer.  While the Sixth Circuit Court of Appeals had held there is no cause of action for third-party retaliation on behalf of friends and family members who have not engaged in protected activity themselves, the Supreme Court soundly rejected that ruling.

In an opinion that was authored by Justice Scalia, the Court called it “obvious” that retaliating against an employee by firing her fiancé could dissuade that person from filing an EEO complaint or engaging in other legally-protected acts.

In another unanimous pro-employee outcome, Staub v. Proctor Hospital, the High Court held that employers may be liable for discrimination even when the decisionmaker herself harbored no discriminatory animus toward the plaintiff.  That marked yet another Justice Scalia opinion.

The case involved the claims of a military reservist who purportedly had been terminated from his job at an Illinois hospital for insubordination.  The plaintiff Vincent Staub said, however, that the real reason was because his immediate supervisor and another supervisor had an anti-military bias.  He claimed both were upset because of time he had missed while serving on active duty in Iraq.

The actual decisionmaker, though, was an HR vice president who had acted with no apparent bias.  Nonetheless, the Supreme Court found that lack of hostility to be irrelevant.  That’s because the supervisor who allegedly frowned on Staub’s military obligations was the same one who wrote up the report that the HR vice president relied upon in making her decision.

Meanwhile, another employee prevailed at the nation’s highest court in the Fair Labor Standards Act retaliation case of Kasten v. Saint-Gobain.  The justices ruled that the FLSA protected a Wisconsin factory worker’s complaints about the placement of time clocks even though he never made them in writing.

The Court found that oral complaints to company officials were enough.  In reaching their ruling, the justices reasoned that it was unlikely Congress would have wanted to limit the labor law’s effectiveness by excluding those who would find it hard to reduce their complaints to writing, namely illiterate, less educated or overworked employees.  It’s an opinion that is sure to aid the rights of blue-collar workers.

So what can we draw from these results?  The Supreme Court has a well-earned a reputation as a pro-business court.  And these three opinions hardly represent a seismic shift.  But while none of them are on the scale of the Wal-Mart or AT&T rulings, they ARE significant.

In all three of those retaliation cases, the employees had lost at the federal appellate level.  The fact that the Supreme Court saw fit to hear all three of those disputes and to issue one-sided reversals each time is a sign that the justices are willing to take a strong stand against retaliation in the workplace, at least when individual employees are affected rather than a large class.

About the Author: David Weisenfeld served as U.S. Supreme Court correspondent for LAWCAST from 1998 through June 2011.  During that time, he covered every employment law case heard by the Court, and also wrote and co-anchored the company’s employment law newscasts.  In addition, his work has appeared in the American Bar Association’s Supreme Court Preview magazine.


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Warehouse Workers File Second Lawsuit Against Chicago-Area Wal-Mart Contractors

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kari-lydersenCHICAGO—Last week, the Chicago-based group Warehouse Workers for Justice (WWJ) filed its second class action lawsuit this year against an agency responsible for staffing Wal-Mart’s warehouse in suburban Elwood.

The suit, filed May 18, charges the staffing company SIMOS Insourcing Solutions with legal violations including not fulfilling promises made to workers as part of the terms of their hiring. Among other things, workers said they were offered paid vacations that were never granted.

According to a WWJ press release, the company “required employees to incur fees to get their paychecks and failed to give the warehouse workers critical information about their pay, benefits and other terms of their employment as required by Illinois law.”

The new class action lawsuit is part of a larger campaign to force staffing agencies to give workers written proof of their contracts, their wages and the way their pay is calculated. Wage theft is reportedly rampant in the industry, but often hard to prove since workers are given little or no documentation of what they have been promised, how many hours they have worked, how much they are paid and in some cases who they are even technically working for.

In March, the group filed another class action lawsuit alleging that the Reliable Staffing agency, which hired workers for the Elwood Wal-Mart warehouse, paid them much less than promised, in part through manipulating or changing the terms of a piece-meal pay schedule.

As I previously blogged:

“The check stub is a fiction – their check stub could show they worked 36 hours when they really worked 72 hours,” said attorney Chris Williams. That’s why, Williams said, it’s so important the workers are able to demand their billing records under the state day labor services act.

Also earlier this month workers at a Kraft-Cadbury warehouse in the suburb of Joliet filed complaints with the Equal Employment Opportunity Commission about alleged discrimination by the firm Schenker Logistics. Filing such a complaint is the first step in filing an employment discrimination lawsuit, if the EEOC decides not to investigate itself.

These legal actions are part of a multi-faceted campaign to hold staffing companies legally accountable for their behavior; and also build greater public awareness of rampant labor rights issues in the warehouse industry; and to embolden workers to speak out about these issues. The group has not sued Wal-Mart, since the company argues it is not directly responsible for hiring and wage and hour issues in its warehouses. SIMOS is based in Georgia and promises to slash labor costs for clients like Wal-Mart. The company’s website says:

Ultimately, our goal is to drive constant improvements in cost, quality, and on time delivery. SIMOS consistently delivers cost reduction programs our clients can actually see. On average, SIMOS customers save 10-25% in labor costs per unit while increasing their output by 15-30%.

It says it achieves these labor cost reductions by a “combination of engineering, workforce management and supervision.” Critics say this is just code for paying workers as little as possible, including by keeping them in the dark about the actual terms of their working agreements.

This article originally appeared on the Working In These Times blog on May 23, 2011. Reprinted with permission.

About the Author: Kari Lydersen, an In These Times contributing editor, is a Chicago-based journalist whose works has appeared in The New York Times, the Washington Post, the Chicago Reader and The Progressive, among other publications. Her most recent book is Revolt on Goose Island. In 2011, she was awarded a Studs Terkel Community Media Award for her work. She can be reached at [email protected]


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Study: Increasing Wages at Wal-Mart Would Barely Affect Shoppers

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mike elkWal-Mart is the largest private-sector employer in the United States. It employs more than 1.4 million workers here, but pays them an estimated 12 percent less than average retail workers in the country. Many argue that, while unfortunate, such low wages help poor families since by allowing them to purchase goods cheaply.

That argument was most famously articulated by the current National Economic Council Deputy Director, who before she joined the White House published a paper in 2005 titled “Wal-Mart A Progressive Success Story.” It argued that Wal-Mart could not raise wages without raising prices, which would hurt poor and low income communities

However a study released on Monday by University of California, Berkeley’s Center for Labor Research and Education found that increasing wages to $12 per hour would cost Wal-Mart $3.2 billion if applied to all workers across the United States. That amounts to about 1 percent of the company’s annual sales of $305 billion. Even if Wal-Mart were to pass on the total cost of the wage increase to consumers, researchers estimate that shoppers would pay about $12.50 more per year – or 46 cents per shopping trip – to cover the cost of the pay raise for Wal-Mart workers.

UC Berkley researcher Ken Jacobs doubts that all the costs of a wage increase would be passed on to consumers in the form of increased prices, because increasing prices would lower the amount of goods Wal-Mart would sell.

A worker collects shopping carts outside a Wal-Mart store in Mount Prospect, Ill.   (Photo by Tim Boyle/Getty Images)
A worker collects shopping carts outside a Wal-Mart store in Mount Prospect, Ill. (Photo by Tim Boyle/Getty Images)

“Wal-Mart is the largest private employer in this country and it’s dragging down wage job standards for retail and grocery workers. It can clearly afford to pay workers a well wage” says Jennifer Stapleton, assistant director of Making Change at Wal-Mart, which is run by the United Food and Commercial Workers union.

“Even if the company passes on that cost to customers, it would be the same cost as a pack of gum. Consumers would be open to that, instead of feeling guilty for shopping at Wal-Mart.”

Indeed, such a wage increase could really help workers. A $12 an hour wage would mean average annual pay increases of $3,250 to $6,500 for workers making less than $9 an hour, and $1,675 to $2,930 for workers making between $9 and $12 an hour. 41 percent of the pay increase would go to workers in families with total incomes of 200 percent of the poverty line—less than $21,660 a year for a single worker and $44,100 a year for a family of four.

And the cost for the wage increase would not come out of the pocket of poor workers, but 72 percent of the costs of this substantial benefit would be borne by people making above 200 percent of the poverty line.

Despite statistical evidence saying that raising labor prices has very little effect on consumer prices, advocates of low wages claim wages must be keep low to keep consumers good cheap. We hear this same argument applied to free trade: Goods are cheaper from China and other low-wage countries because these countries pay workers a lower wage.

“Even for most manufacturing, the labor cost is a very small percentage in all but some of the most rudimentary manufacturing, like textiles. For things like steel high tech or most manufacturing that is heavily capital intensive the labor impact is minimal,” says Scott Paul, executive director of the Alliance for American Manufacturing, an alliance of businesses and organized labor. “Labor costs in China amount to less than 10% of overall cost, labor cost differential washed away by productivity in the United States.”

Paul points to other countries where workers make higher wages than Americans but have no trade deficit with the U.S. “Average factory compensation for a worker in the United is $32 dollars an hour. In Germany, the average factory worker makes $48 dollars an hour. Despite this, the United State has a $275 billion trade deficit, while Germany has balanced trade with China. How is it that when our labor costs are $16 an hour cheaper than Germany?“ asks Paul. “It has everything to do with our trade policies, infrastructure policies, tax policies and investment in skills, and very little if anything to do with the cost of labor.”

The new attacks on public-sector workers’ salaries and benefits in Wisconsin and other states have triggered a debate about whether labor costs place too much of a burden on taxpayers. Hopefully this debate over paying workers good wages won’t spill into tired old debates about free trade.

About the Author: Mike Elk is a third-generation union organizer who has worked for the United Electrical, Radio, and Machine Workers, the Campaign for America’s Future, and the Obama-Biden campaign. Based in Washington D.C., he has appeared as a commentator on CNN, Fox News, and NPR, and writes frequently for In These Times as well as Alternet, The Nation, The Atlantic and The American Prospect.

This blog originally appeared in These Times on April 19, 2011. Reprinted with Permission.


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Join March 29 Rally to Support Wal-Mart Women

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Image: James ParksHundreds of people will show their support outside the U.S. Supreme Court Tuesday, when the High Court hears oral arguments in what could become the largest class-action civil rights suit in U.S. history.

The Stand with the Women of Wal-Mart rally will take place as the nation’s highest court hears arguments on Wal-Mart v. Dukes to decide whether the case can move forward as a class action.

Ten years ago, a group of women who worked at Wal-Mart stores, led by Betty Dukes, filed a lawsuit alleging the corporation engaged in company-wide gender discrimination by paying women less than men, promoting fewer women to management positions and promoting male employees more quickly. The case, now a class action, has made its way to the Supreme Court.

Wal-Mart is challenging the decision by a lower court to allow the women employed at Wal-Mart stores across the country to join together in a class action lawsuit to challenge pay and promotion practices that discriminate against women.

If Wal-Mart succeeds in keeping these women from joining together, the already uphill battle for women to fight pay discrimination will get even worse. But If the women prevail, their case will become the largest class-action civil rights suit in the nation’s history, with some 1.6 million female Wal-Mart and Sam’s Club employees.

A coalition of women’s, workers’ and religious groups are sponsoring the rally, including the AFL-CIO constituency group, the Coalition of Labor Union Women (CLUW).

In a statement, the American Association of University Women (AAUW), another rally sponsor, says class action can send a strong message to employers to follow the law in the first place. Lisa Maatz, AAUW’s director of public policy and government relations, says:

This case illuminates the dirty little secret that women know all too well — that pay discrimination is alive and well and undermining the economic security of American families.

About the Author: James Parks’ first encounter with unions was at Gannett’s newspaper in Cincinnati when his colleagues in the newsroom tried to organize a unit of The Newspaper Guild. He saw firsthand how companies pull out all the stops to prevent workers from forming a union. He is a journalist by trade, and has worked for newspapers in five different states before joining the AFL-CIO staff in 1990. He also has been a seminary student, drug counselor, community organizer, event planner, adjunct college professor and county bureaucrat. His proudest career moment, though, was when he served, along with other union members and staff, as an official observer for South Africa’s first multiracial elections.

This blog originally appeared in ALFCIO on March 28, 2011. Reprinted with Permission.


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Wal-Mart Warehouse Workers File Class Action Wage Theft Lawsuit

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kari-lydersenCHICAGO—After three months of working in a Wal-Mart warehouse in the Chicago suburbs last fall, Robert Hines was fed up with getting paid much less than he had been promised by the company Reliable Staffing, which hired temporary workers to unload containers.

But the final straw came when he wasn’t paid at all for seven 10-12 hour days he’d worked shortly before Thanksgiving, he says. His calls to the agency weren’t returned, and when he went in person to demand his money, he said a manager claimed he and his work partner, Leo Williamson, had never worked those days at all.

So Hines and Williamson are among eight named plaintiffs in a class action lawsuit filed today in federal court charging Reliable Staffing, its owner Daniel Gallagher and Schneider Logistics, which runs the Wal-Mart warehouse in Elwood, Ill., with violating state and federal labor laws.

When former Reliable Staffing workers marched into the agency last Monday demanding pay and billing records (as is their right under the Illinois Day and Temporary Labor Services Act), they were not given any records and, they say, were greeted with hostility by Gallagher.

Deathrice Jimerson and Demetrie Collins allege they were cheated out of hundreds of dollars in wages at a Wal-Mart warehouse.   (Photo by Kari Lydersen)
Deathrice Jimerson and Demetrie Collins allege they were cheated out of hundreds of dollars in wages at a Wal-Mart warehouse. (Photo by Kari Lydersen)

Under the Illinois day labor act, considered one of the nation’s strongest such laws, the workers have the right to see what Reliable Staffing billed Schneider for their work, and what it paid them. If the hours and/or piece rates reported to Schneider and reported to the workers themselves don’t add up, it could show Reliable Staffing was intentionally not paying workers for their labor.

The plaintiffs think that was standard practice at the company.

“The lady looked me in the face and said I have no recollection of you working,” said Hines, 37. “I got vulgar comments, a snazzy attitude from them. And I was breaking my back for peanuts, or to not even be paid at all.”

The lawsuit alleges violations of the aforementioned Illinois Day and Temporary Labor Services Act, along with the Fair Labor Standards Act, the Illinois Minimum Wage Law and the Illinois Wage Payment and Collection Act. Allegations include unpaid overtime, failure to pay state and federal minimum wage and failure to pay at least four hours’ wages when workers were called in to work, as mandated by the day labor services act.

The lawsuit says that plaintiffs who worked for Reliable Staffing from 2006 on were promised $10 an hour, plus a piece rate for unloading trucks, including a higher “premium” piece rate for heavier goods. It alleges they were not paid the piece rate as promised, and that in fact workers were often paid less than state and federal minimum wage along with not being paying overtime.

Hines said that at the rate promised, his paychecks for working often from 6 a.m. to 6 p.m. should have been at least $300 a week – not counting overtime, which he also should have been due. But he was usually paid $239.

The suit also alleges workers were not paid for mandatory waiting time, adding up to multiple hours per week. It says that when one defendant wrote his arrival time on a sign-in sheet, a supervisor actually tore the sheet up.

“Reliable Staffing actually did not keep track of people’s hours,” said attorney Chris Williams. “That’s illegal. Even if you are paying a piece rate, under federal law you need to show that adds up to at least minimum wage.”

And the suit alleges Reliable Staffing violated state laws by failing to provide workers with documentation of where and for which third party they would be working, the nature of the work and how much they would be paid. The suit basically alleges that workers were paid the $10 piece rate only – often divided between two or three workers, workers say – and then the employer simply made up the number of hours the worker supposedly worked by dividing the piece rate by 10.

“The check stub is a fiction—their check stub could show they worked 36 hours when they really worked 72 hours,” said Williams. That’s why, Williams said, it’s so important the workers are able to demand their billing records under the state day labor services act.

“The workers are supposed to be able to go into the office and get this information themselves,” Williams said. “But unfortunately the law isn’t working. That’s why we had to take this to federal court.”

The suit says:

In fact, Defendants Reliable and Gallagher provided Plaintiffs and similarly situated laborers with check stubs that contained false information, showing the final gross compensation to the laborer divided by $10.00, thereby showing a number of hours worked on the check stub that bears no relationship to the actual number of hours worked…

Rather than provide Plaintiffs and the Class with the actual hours worked, Defendants Reliable and Gallagher provided Plaintiffs and the Class with a fictional number of hours worked and a fictional pay rate as described in paragraph.

The lawsuit adds that failing to provide workers documentation of their employment terms makes it easier for employers to cheat workers, saying:

The Illinois legislature found that such at-risk workers are particularly vulnerable to abuse of their labor rights, including unpaid wages, failure to pay for all hours worked, minimum wage and overtime violations, and unlawful deduction from pay for meals, transportation, equipment and other items.

The workers’ want unpaid wages, going back up to three years. The lawsuit also asks for statutory damages on some counts, attorneys’ fees, and that the company be blocked from violating these laws in the future. The suit notes that under the day labor services act, third party companies like Schneider that hire staffing companies are liable and legally responsible for any unpaid wages by the staffing company.

Depending on how the law is interpreted, it’s possible Wal-Mart itself could be liable.

“Hopefully this lawsuit will trickle down and help not just us but other people,” said Hines. “Maybe they’ll wake up and see that they have to treat people fairly if they want to get more out of us. Now they’re sitting there high on the hog, eating nice food, while we’re on the dollar menu at McDonald’s.”

This blog originally was posted on http://www.inthesetimes.com/on February 28, 2011. Reprinted with Permission.

About the Author: Kari Lydersen, an In These Times contributing editor, is a Chicago-based journalist whose works has appeared in The New York Times, the Washington Post, the Chicago Reader and The Progressive, among other publications. Her most recent book is Revolt on Goose Island. In 2011, she was awarded a Studs Terkel Community Media Award for her work. She can be reached at [email protected]



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