California Public Agency Labor & Employment Blog

California Public Agency Labor & Employment Blog

Useful information for navigating legal challenges

Employee Time Spent Going Through Security Checks Is Not Compensable Work Time

Posted in FLSA, Wage and Hour

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This blog post was authored by James E. Oldendorph Jr.

On December 9, 2014, the U.S. Supreme Court unanimously held that workers need not be paid for the time spent waiting to and actually undergoing security screenings while leaving their work facility.  (Integrity Staffing Solutions, Inc. v. Busk (Dec. 9, 2014, No. 13-433.)  This decision reverses the judgment of the Ninth Circuit Court of Appeals.

Integrity Staffing Solutions, Inc. (“Integrity Staffing”) provides warehouse space and staffing to companies such as Amazon.com.  In order to prevent theft, Integrity Staffing required its warehouse workers who retrieved and packaged orders for Amazon customers to undergo a security screening before leaving the warehouse each day.  Jesse Busk and Laurie Castro were Integrity Staffing employees who worked in warehouses in Nevada.  In 2010, they sued Integrity Staffing seeking back pay and overtime under the Fair Labor Standards Act (“FLSA”) for the time spent passing through these security screenings.  They alleged that they spent up to 25 minutes each day waiting to be searched, removing their wallets, keys, and belts, and passing through metal detectors.

Under the FLSA, activities that are preliminary or postliminary to the principal activity or activities that the employee is employed to perform are generally not compensable.  But preliminary and postliminary activities are compensable if they are “integral and indispensable” to an employee’s principal activities.  Despite countless lawsuits regarding these issues, courts have inconsistently interpreted these terms and what is required to be paid work time under the FLSA.

Here, the Ninth Circuit had focused on the fact that the company required its employees to pass through these security screenings.  And, because the screenings benefited the employer by preventing theft, the Court of Appeals concluded that the screenings were indispensable to the employees’ work activities.  Last week, the Supreme Court disagreed and held that Integrity Staffing’s security screenings were postliminary activities and not required to be paid.

The Supreme Court focused on two factors.  First, the security screenings were not the principal activity which the employees were employed to perform.  The company employed the workers to retrieve items and ship orders to Amazon customers – not to undergo security screenings.

Second, the screenings were not “integral and indispensable” to the employees’ job duties as warehouse workers.  That is, the employees could still perform their job duties even if the company stopped conducting the screenings.  The Court noted that the FLSA analysis should be focused on whether the activities are tied to productive work, and not whether the employer requires the activity.

The employees argued that Integrity Staffing could have reduced the wait time by having more security screening lines or staggering the times employees got off of work.  But the Court found that these arguments are better suited for the collective bargaining table rather than an FLSA court case.

While this decision has limited applicability to most public employers who have very limited, if any, security screenings, this ruling does provide insight as to what is truly considered compensable work time.  In determining what pre and post-shift activities should be paid, employers should focus on whether the activity is indispensable and integral to the productive work the employee is hired to perform, and not on what the employer requires or whether the activity benefits the employer.

FLSA lawsuits are still on the rise and these cases are very fact-specific.  Employers should contact legal counsel before applying these rulings to their specific work situations.

California Supreme Court Allows Hearing Officers to Rule on Pitchess Motions in Administrative Disciplinary Appeal Hearings

Posted in Public Safety Issues

Gavel-and-Flag.jpgThis post was authored by Alex Polishuk.

On December 1, 2014, the California Supreme Court issued its decision in Riverside County Sheriff’s Department v. Stiglitz, ruling that a hearing officer in an administrative appeal hearing has the authority to rule on a Pitchess motion for discovery of peace officer personnel records. The Court largely relied on the phrasing of California Evidence Code section 1043 which expressly allows Pitchess motions to be filed with an appropriate “administrative body.”

The underlying facts of the case involve Kristy Drinkwater, a former correctional deputy with the County, who was terminated for falsifying time records in order to obtain unearned compensation.  Per the terms of an applicable memorandum of understanding, Ms. Drinkwater appealed her termination to a hearing officer, Jan Stiglitz.  During the appeal hearing, Drinkwater submitted a Pitchess motion to Stiglitz requesting discovery of disciplinary records of other sworn personnel who were investigated for similar misconduct but allegedly received less discipline.  Initially, Stiglitz denied the motion because Drinkwater did not identify the employees whose records were sought.  In a renewed motion, Drinkwater identified the employees by name and sought only redacted records.  Stiglitz found good cause and ordered production. The County filed a petition for writ of administrative mandate seeking to compel Stiglitz to vacate his decision.  However, shortly before the trial court was set to rule on the writ petition, the Court of Appeal decided Brown v. Valverde (2010), holding that Pitchess discovery of confidential peace officer personnel records is not available in a DMV administrative license suspension hearing.  Relying on Brown, the County argued that only a judicial officer may rule on a Pitchess motion.  The trial court agreed with the County and Drinkwater and her union appealed.  The Court of Appeal reversed and ruled that a hearing officer in an administrative appeal of the dismissal of a correctional officer has the authority to rule on a Pitchess motion.  Now the Supreme Court has affirmed the Court of Appeal’s ruling.

At the root of the Supreme Court’s lengthy and detailed decision is the language of the Pitchess statutes, i.e. Evidence Code sections 1043 and 1045.  The Court explains that a Pitchess motion consists of a two-step process.  First, Evidence Code section 1043 requires the moving party to establish good cause for discovery of the requested records, which are confidential under Penal Code section 832.7. Next, if good cause is established, Evidence Code section 1045 requires an in camera hearing, i.e. a private review, to determine the relevance of the requested documents.  Notably, Section 1045 repeatedly refers to “the court” as the entity that must conduct the in camera review, determine relevance, and issue appropriate protective orders.

In its decision, the Supreme Court stresses that the inclusion of the term “administrative body” in Section 1043 reflects the Legislature’s intent that administrative hearing officers are authorized to rule on Pitchess motions.   The Court explains that the repeated use of the term “court” in Section 1045, cannot nullify the term “” in Section 1043.   The Court remarks that “[i]f the Legislature intended that only the superior court could rule on Pitchess motions, it could easily have said so.”  The Court also takes the position that if an administrative hearing officer could not rule on a Pitchess motion then Section 1043 authorizes an “idle act,” i.e. filing a motion with a body not authorized to rule on it.  The Court adds that had the Legislature intended that Pitchess motions could only be conducted in the superior court, it could have but did not provide a mechanism to transfer a motion from an administrative proceeding to the superior courts.  The Court ruled that by permitting filing with an appropriate administrative body in Evidence Code section 1043, the Legislature intended to allow administrative hearing officers to decide such motions without court intervention.

Additionally, the Court remarks that its conclusion is consistent with the purpose of the POBRA, which is to provide peace officers an opportunity to administratively appeal an adverse employment decision.  The Court also states that its ruling was in line with the Pitchess scheme of providing a balance of interest between a litigant’s discovery interest with an officer’s confidentiality interest.

It’s the Most Wonderful Time to Minimize Liability

Posted in Employment, Workplace Policies

Happy HolidaysIt is that time of the year again… the holiday season.  Time to celebrate!  Many employers throw festive holiday or year-end parties complete with food, alcohol and entertainment.  According to a Society of Human Resource Management Survey on Holiday/Year End Activities, in recent years about two-thirds of organizations have held holiday parties for their employees.  However, as we have pointed out in years past, sometimes holiday parties can create legal liability for the employer.  According to one recent study, about one in three employers reported some misconduct at holiday parties.  Below we provide a few tips to minimize the potential for a new year legal hangover.

If the party is going to be off-site, as about 60% of them are, choose an appropriate venue and entertainment for your organization.  This may sound obvious, but avoid the local dive bar or franchise known for scantily-clad servers.  Avoid controversial entertainment such as MCs, comedians or music with vulgar language or messages that some employees may find offensive.  Also, mistletoe is an invitation for harassment claims, so avoid mistletoe as decoration.

The relaxed atmosphere and eat, drink and be merry attitude at holiday parties make it more likely that employees will feel less inhibited than they normally do.  Employees tend to dress more provocatively than usual.  Employees may over-indulge in alcohol consumption. Employees may feel more comfortable making inappropriate or off-color remarks about the appearance, gender, sexual orientation, race, ethnicity or religion of others.  An employee may feel emboldened to make a sexual advance towards another employee that may or may not be wanted.  All of these things could lead to claims of harassment, discrimination or even injuries to employees or other third parties.

For these reasons, before the party, consider taking the time to remind employees of the employer’s policies on alcohol and drugs, harassment and discrimination, and workplace violence, as well as dress code and relationship policies.  Employees should be advised that these policies apply at the holiday party which is an employer-sponsored event and that misconduct at the party in violation of these policies could result in discipline.  In addition, supervisors and managers should be reminded of their reporting obligations with respect to harassment, discrimination and workplace violence.  If any misconduct is reported, it should be promptly investigated.

Not surprisingly, excessive alcohol consumption is often related to holiday party misconduct. Intoxicated employees have impaired judgment.  So, if you choose to serve alcohol at the holiday party, consider taking the following steps in planning the party to minimize risk of misconduct or injury.

  • Hire professional bartenders who are trained to deal with serving guests who may be excessively consuming alcohol.  Don’t make an employee responsible for serving drinks.
  • Consider serving beer and wine and avoiding hard alcohol.
  • Consider having a drink ticket system or cash bar to limit alcohol consumption.
  • Avoid spiked punch or mixed alcoholic beverages that disguise the amount of alcoholic content in each drink.
  • Serve food containing starches or protein to slow alcohol absorption.
  • Make non-alcoholic beverages available and stop serving alcohol well before the party-goers will be leaving the party.
  • Designate a supervisor or manager (who is exempt under the FLSA) to provide discrete oversight over employees during the party.
  • Advise employees who intend to drink to do so responsibly and plan for safe transportation home. Encourage use of cabs, designated drivers and, if possible, consider providing transportation for employees who have been drinking.

Taking steps to plan an appropriate holiday party can go a long way towards minimizing risk of liability so that everyone can enjoy this wonderful time of year.

Tips from the Table: Making Promises We Can’t Keep

Posted in Labor Relations, Negotiations

We are proud to continue our video series – Tips from the Table. In these monthly videos, members of LCW’s Labor Relations and Negotiations Services practice group will provide various tips that can be implemented at your bargaining tables. We hope that you will find these clips informative and helpful in your negotiations.

Year-End Review of California’s Notable Employment Decisions

Posted in Litigation

Scales.jpgOverall, employers fared well in the outcome of published decisions related to various employment claims this year (although there were cases that went to employees).  Some of the notable cases are discussed below.

Fitness for Duty

A university professor unsuccessfully sued his employer for violations of the California Fair Employment and Housing Act (FEHA), the Unruh Civil Rights Act, and the Confidentiality of Medical Information Act.  After a number of faculty complained that the professor’s actions were frightening, such as yelling, physical confrontation, and verbal threats, the university required the professor to obtain a fitness for duty examination.  When he refused, the university terminated his employment.  The FEHA allows an employer to require a physical or mental examination if it is job-related and consistent with business necessity.  A jury found in favor of the university, and on appeal, the appellate court agreed that the university lawfully terminated the professor’s employment for his refusing to participate in the fitness for duty exam. (Kao v. University of San Francisco (2014).)

A county employee sued for alleged violation of the Family Medical Leave Act (FMLA) when she was required to submit to a fitness for duty examination after she returned from an FMLA leave.  The employee had demonstrated a history of mental instability and poor decision making prior to taking leave for her mental condition.  The employee was scheduled to return to work; however, prior to her return, she was placed on paid administrative leave and informed that she needed to participate in a medical reevaluation and that failure to do so could result in termination.  The employee did not appear for the evaluation and was terminated.  She contended the FMLA prohibited the reevaluation; however, the court disagreed finding the employer could return an employee to work after FMLA leave and seek a fitness for duty if it is not satisfied with the employee’s health care provider’s certification. (White v. County of Los Angeles (2014).)

First Amendment

A county employee alleged she was retaliated against for exercising First Amendment speech rights after she was subject to involuntary workplace transfers and internal investigations, among other actions.  The employee contended the adverse employment actions resulted from her protected speech related to union activity.  The court agreed that a reasonable jury could find the adverse employment actions were retaliation for protected speech and remanded the case for further evaluation of the employee’s claims. (Thomas v. County of Riverside (9th Cir. 2014).)

A university professor alleged the administration retaliated against him for exercising his First Amendment rights in distributing a pamphlet and drafts of his in-progress book.  He claimed to have received poor performance evaluations and discipline because of those written materials.  The pamphlet discussed plans to separate two faculties of study in connection with restructuring of the liberal arts college.  The standard for evaluating a public employee’s speech was governed primarily by Pickering v. Board of Education from 1968 until 2006 when the U.S. Supreme Court decided Garcetti v. CellabosPickering set forth a general balancing test for evaluating public employee speech claims, and Garcetti clarified the formulation by holding that public employee speech pursuant to “official duties” is not protected at all.  Garcetti left open whether its rule applied to certain academic speech.  In deciding the university professor’s case, the U.S. Court of Appeals for the Ninth Circuit held the appropriate standard for evaluating speech related to “scholarship or teaching” is Pickering,  and that Garcetti’s “official duties” rule does not apply to such speech.  The Ninth Circuit concluded the professor’s pamphlet was potentially protected speech under Pickering and remanded the case for further proceedings. (Demers v. Austin (9th Cir. 2014).)

Family Medical Leave Act

An employee was terminated for violating company policy – a “three day no-show, no call” rule — when she failed to return to work after a vacation.  The employee asked and was allowed to use two weeks of vacation to go to Guatemala to care for her ailing father.  Shortly after the initial request, she requested additional unpaid leave at the end of the two weeks but her supervisor said “no.”  The employee did not return to work until after the initial two weeks, and she was then terminated for failing to return to work.  She alleged her employer violated her rights under the FMLA because the additional leave she sought qualified as FMLA leave.  The Court held that the employer, however, is not required to designate the leave as FMLA when the employee expressly requested that it not be.  Here, the employee asked for vacation and did not ask for FMLA leave either at that time or after that; as a result, the jury determined the employer did not violate the FMLA, and the Court of Appeals did not overturn the determination. (Escriba v. Foster Poultry Farms, Inc. (9th Cir. 2014).)

FEHA Statute of Limitations

An employee who complained about sexual harassment eventually resigned her employment and sued her employer, asserting three claims under FEHA.  The employer argued the lawsuit was untimely because it was filed more than six months after the date of the employment action.  The application for employment signed by the employee had provided that the employee must file any claim or lawsuit within six months after the date of the employment action.  The court held a limitations period shorter than provided by statute under FEHA is against public policy and unenforceable. (Ellis v. U.S. Security Assoc. (2014).)

Uniform Pay is Anything But Uniform: Should Yours Be Included in the Regular Rate of Pay?

Posted in Wage and Hour

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This blog post was authored by Shardé C. Thomas.

Public employers often require employees to wear uniforms and the employers may reimburse employees to cover the cost of maintaining or replacing the uniforms.  Some employers provide employees more than the cost of maintaining or replacing the uniform, either in an excess of caution or as a form of additional compensation.  But providing uniform pay can have FLSA implications.  Some types of uniform pay are considered mere reimbursements, but some types are considered compensation.  Here are a few things you need to know about uniform pay.

1.     Uniform pay may be excluded from the regular rate of pay.

The Fair Labor Standards Act excludes “reasonable payments” for certain expenses, including uniform reimbursement, from the regular rate of pay.  Therefore, if an employer provides employees with a reasonable amount to reimburse employees for uniforms and related costs, the uniform pay payment may be excluded when calculating the FLSA regular rate of pay for overtime purposes.

2.     Uniform pay should reflect the actual or reasonably approximate amount for maintenance of uniforms.

Uniform pay which reflects the actual or reasonably approximate amount for purchasing, laundering or repairing uniforms or special clothing an employer requires an employee to wear does not need to be included in the regular rate of pay.  This type of uniform pay is considered a reimbursement.

3.     Uniform pay in excess of the actual or reasonably approximate amount for maintenance of uniforms should be included in the regular rate of pay.

When employers pay an amount above what might be considered reasonable to maintain uniforms, that additional payment may be considered compensation for employees and required to be included in the regular rate of pay.  An Illinois federal court recently addressed this precise issue in Caraballo v. City of Chicago (N.D. Ill. 2013) 969 F.Supp.2d 1008.  A group of paramedics sued the City of Chicago for failing to include the $1250 the paramedics received annually as uniform pay in their regular rate of pay.  The Court determined the City was entitled to exclude at least some of the uniform pay from the regular reimbursement because at least some of the uniform pay reimbursed the paramedics for maintaining and cleaning the uniforms.  But the Court also determined that the City had not set forth evidence to show the amount of the uniform pay was the “actual or reasonably approximate amount” for maintaining the uniforms as intended.

If an agency reimburses employees for uniform pay with an amount in excess of what is reasonably needed to clean and maintain the uniform, the agency should include the excess amount in the regular rate of pay when calculating overtime pay for those employees.  To determine the excess over a “reasonable amount,” employers should review and maintain records and evidence of the “reasonable amount,” such as receipts for cleaning the uniforms or purchasing new ones.

 

Court of Appeal Holds That Actual Notice Must Be Provided to Police Officer Within the 1-Year POBRA Statutory Timeframe

Posted in Public Safety Issues

Gavel-and-Books.JPGOn November 13, 2014, the Third Appellate District in Earl v. State Personnel Board held that the notice of intended discipline required to be given to a public safety officer under Government Code Section 3304(d) must actually be provided to the officer within the one-year statute of limitations.

Subject to certain exceptions, Government Code Section 3304(d) states that no punitive action or denial of promotion against a peace officer may be taken if the investigation of the misconduct is not completed within one year.  Under this section of the Public Safety Officers Procedural Bill of Rights Act (“POBRA”), the one-year statute of limitations is triggered by the date “of the public agency’s discovery by a person authorized to initiate an investigation of the allegation.…”  Plus, if a public safety department determines that disciplinary action will be taken, it must complete its investigation and “notify the public safety officer of its proposed discipline by a Letter of Intent or Notice of Adverse Action articulating the discipline that year.”  However, the department is not required to impose the discipline within that one-year period.

In the Earl case, on May 27, 2009, the California Department of Corrections and Rehabilitation learned that one of its parole agents, Baron Earl, engaged in potential misconduct when the Department discovered at a hearing regarding another employee that Earl may have conducted an unlawful search of a residence.  On May 27, 2010, after having completed an investigation and sustaining findings of misconduct, Earl was served, by certified mail, with a notice of intent to discipline him.  He received the notice of intent more than one year after the Department learned of the potential misconduct.  At his administrative hearing appealing the discipline, Earl argued that the notice he received was inadequate, as he received it late.  This argument was rejected, and his discipline was upheld.  Earl next filed an administrative mandamus petition making the same argument, and the petition was denied by the trial court.

Earl then appealed to the Court of Appeal and argued that he was entitled to “actual notice” of the contents of the notice of intent within one year of the date of discovery; not service by mail that was received after the one-year date of discovery. The Court of Appeal agreed.

On appeal, Earl argued that although civil service laws contained in the Government Code allow for serving notices of disciplinary action by personal service or by mail, peace officers are subject to an entirely separate statute, the POBRA, which requires actual notice, not constructive notice such as by mail.  Earl argues that basic principles of statutory construction provide that a statute that is silent as to the manner in which notice must be given contemplates personal service of said notice.  The Department of Corrections argued that the word “notify” in Section 3304(d) of POBRA allows for either actual or constructive notice.

The Court of Appeal relies on its 2007 decision in Hoschler v. Sacramento City Unified School District to hold that Section 3304(d) of the POBRA requires actual service of the notice of intent to discipline a peace officer within the relevant one-year statute of limitations.  In Hoschler, the Court of Appeal interpreted a provision of the Education Code which provided that a probationary teacher would be reelected and ultimately achieve tenure unless timely notified of non-reelection by March 15.  The School District had sent notice of non-reelection to a teacher by certified mail on March 12, and there was no evidence that the teacher evaded picking up his mail.  In Hoschler, the Court of Appeal held that where a statute is silent as to the method of notice, then personal service or some other method equivalent to imparting actual notice is required.

The Court of Appeal applies the same interpretive rule to Section 3304(d) in the Earl case and holds that service by mail as perfected by the Department was not adequate because he did not get actual notice of the contents of the notice of intent for discipline within one year of the date of discovery.

The Court of Appeal also states that Earl is not a case of willful evasion of notice, and concludes that the issue of evasion is thus not before it.  In a footnote, it cites to Sullivan v. Centinela Valley Union High School Dist. (2011), a case where a School District hired a probationary teacher for the 2006-2007 school year and reemployed him for the 2007-2008 school year. On March 10, 2008, the District’s human resources director told Sullivan that the District had decided not to recommend his reelection for the following school year and that he could resign in lieu of being non-reelected. Sullivan called in sick on March 11 and 12. On March 13, the District’s governing board approved Sullivan’s non-reelection against the wishes expressed by Sullivan’s attorney during the public comments portion of the board meeting. On March 14,  Sullivan called in sick. On March 15, the District personally delivered a non-reelection notice to  Sullivan’s home address of record and, because Sullivan was not home for the entire day on March 15, another resident accepted the letter on Sullivan’s behalf. On March 16, Sullivan returned home and read the non-reelection notice, one day after the deadline to get notice of non-reelection.  Sullivan challenged his non-reelection and sought a court order compelling the School District to reinstate him because the District was one day late in serving him with the non-reelection notice.

Sullivan clarifies how a non-reelection notice may be properly served in light of the Hoschler decision. In Sullivan, the court held that Mr. Sullivan had actual notice of his non-reelection, as required by Hoschler, i.e., before March 15. The Court found that substantial evidence existed to reasonably infer that Sullivan was evading attempts to personally serve the non-reelection notice, and held that the District’s failure to personally serve him under such circumstances was excusable. Importantly, the court found that Sullivan had actual notice that the board would not reelect him for the following school year on March 10, when the District’s human resources director gave Sullivan the option of resigning in lieu of being non-reelected by the board. The court further found that Sullivan’s actual knowledge of his non-reelection was evidenced by his attempts to avoid personal service of the notice.

The Earl Court’s citation to Sullivan is significant, as it leaves the door open for law enforcement departments to make arguments for other forms of service, such as certified mail to be received before the expiration of the one-year statutory period.  This is the case especially where there is evidence of a peace officer evading personal service of a notice of intent for discipline.  However, every effort should be made to complete the investigation and draft the notice of intent for discipline in a fashion to allow time for personal service.  Further, if there is evidence that a peace officer is evading service, then that should be documented and service in some way other than personal service that provides the officer with actual notice of the intention to discipline should be effectuated before the expiration of the one-year statutory time limit.

New Annual Reporting Requirements for Employers under the Affordable Care Act

Posted in Healthcare, Public Sector

Healthcare.jpgThis blog post was authored by Heather DeBlanc.

The Affordable Care Act (“ACA”) will require Applicable Large Employers (i.e. large employers subject to the employer mandate) and employers sponsoring self-insured plans to comply with new annual Internal Revenue Service (“IRS”) reporting requirements.  The first reporting deadline will be February 28, 2016 as to the data employers collect during the 2015 calendar year.  The reporting provides the IRS with information it needs to enforce the Individual Mandate (i.e. individuals are penalized for not having health coverage) and the Employer Mandate (i.e. large employers are penalized for not offering health coverage to full-time employees).  The IRS will also require employers who offer self-insured plans to report on covered individuals.

Large employers and coverage providers must also provide a written statement to each employee or responsible individual (i.e. one who enrolls one or more individuals) identifying the reported information.  The written statement can be a copy of the Form.

The IRS recently released draft Forms 1094-C and 1095-C and draft Forms 1094-B and 1095-B, along with draft instructions for each form.

Which Forms Do I File?

Employer Description Applicable Forms
Applicable Large Employer Offering Fully-Insured Coverage 1094-C and 1095-C(except Part III)
Applicable Large Employer Sponsoring Self-Insured Coverage 1094-C and 1095-C(incl. Part III)
Applicable Large Employer Offering Self-Insured Coverage to Non-Employees (e.g. retirees/COBRA qualified beneficiaries) 1094-C and 1095-C(except Part III);

1094-B and 1095-C

Small Employer (non-ALE) Sponsoring Self-Insured Coverage 1094-B and 1095-B
Small Employer Offering Fully Insured Health Plans Not Applicable

When?

Statements to employees and responsible individuals are due annually by January 31.  The first statements are due January 31, 2016.

Forms 1094-B, 1095-B, 1094-C and 1095-C are due annually by February 28 (or by March 31, if filing electronically).  The first filing is due by February 28, 2016 (or March 31, 2016, if filing electronically).

Even though the forms are not due until 2016, the annual reporting will be based on data from the prior year.  Employers need to plan ahead now to collect data for 2015.  Many employers have adopted the Look Back Measurement Method Safe Harbor (“Safe Harbor”) to identify full-time employees under the ACA.  The Safe Harbor allows employers to “look back” on the hours of service of its employees during 2014 or another measurement period.  There are specific legal restrictions regarding the timing and length of the periods under the Safe Harbor, so employers cannot just pick random dates.  Employers also must follow various rules to calculate hours of service under the Safe Harbor.  The hours of service during the measurement period (which is likely to include most of 2014) will determine whether a particular employee is full-time under the ACA during the 2015 stability period.  The stability period is the time during which the status of the employee, as full-time or non-full-time, is locked in.  In 2016, employers must report their employees’ full-time status during the calendar year of 2015.  Therefore, even though the IRS forms are not due until 2016, an employee’s hours of service in 2014 will determine how an employer reports that employee during each month of 2015.  Employers who have not adopted the Safe Harbor should consider doing so because it allows an employer to average hours of service over a 12-month period to determine the full-time status of an employee.  If an employer does not adopt the Safe Harbor, the IRS will require the employer to make a monthly determination, which is likely to increase an employer’s potential exposure to penalties.

What Must the Employer Report?

Form 1095-C

There are three parts to Form 1095-C.  An applicable large employer must file one Form 1095-C for each full-time employee.  If the applicable large employer sponsors self-insured health plans, it must also file Form 1095-C for any employee who enrolls in coverage regardless of the full-time status of that employee.

Form 1095-C requires the employer to identify the type of health coverage offered to a full-time employee for each calendar month, including whether that coverage offered minimum value and was affordable for that employee.  Employers must use a code to identify the type of health coverage offered and applicable transition relief.

Employers that offer self-insured health plans also must report information about each individual enrolled in the self-insured health plan, including any full-time employee, non-full-time employee, employee family members, and others.

Form 1094-C

Applicable large employers use Form 1094-C as a transmittal to report employer summary information and transmit its Forms 1095-C to the IRS.  Form 1094-C requires employers to enter the name and contact information of the employer and the total number of Forms 1095-C it submits.  It also requires information about whether the employer offered minimum essential coverage under an eligible employer-sponsored plan to at least 95% of its full-time employees and their dependents for the entire calendar year, the number of full-time employees for each month, and the total number of employees (full-time or non-full-time) for each month. 

Form 1095-B

Employers offering self-insured coverage use Form 1095-B to report information to the IRS about individuals who are covered by minimum essential coverage and therefore are not liable for the individual shared responsibility payment.  These employers must file a Form 1095-B for each individual who was covered for any part of the calendar year.  The employer must make reasonable efforts to collect social security numbers for covered individuals.

Form 1094-B

Employers who file Form 1095-B will use Form 1094-B as a transmittal form.  It asks for the name of the employer, the employer’s EIN, and the name, telephone number, and address of the employer’s contact person.

Failure to Report – What Happens?

The IRS will impose penalties for failure to timely provide correct written statements to employees.  The IRS will also impose penalties for failure to timely file a correct return.  For the 2016 reporting on 2015 data, the IRS will not impose a penalty for good faith compliance.  However, the IRS specified that good faith compliance requires that employers provide the statements and file the returns.

More Information

Liebert Cassidy Whitmore will host a webinar on the ACA reporting requirements on December 11, 2014.  For more information, please visit http://www.lcwlegal.com/december-aca-webinar.  You may also find additional information on the ACA at http://www.lcwlegal.com/ACA.

 

California Supreme Court to Hear Issue of Peace Officer Personnel Files

Posted in Public Safety Issues

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On August 11, 2014, the Court of Appeal in People v. Superior Court (Johnson) considered the interplay between the United States Supreme Court’s 1963 decision in Brady v. Maryland, which requires the prosecution’s disclosure of evidence that is favorable and material to the defense (including evidence of dishonesty, bias or moral turpitude on the part of a peace officer) and the statutory discovery procedures articulated by the California Supreme Court in Pitchess v. Superior Court, which provide that peace officer personnel records are “confidential and shall not be disclosed in any criminal or civil proceeding except by discovery” pursuant to Evidence Code section 1043.  In doing so, the Court of Appeal held that a prosecutor’s preliminary inspection of a peace officer’s personnel files for purposes of identifying Brady material does not violate Penal Code section 832.7(a), and does not require the filing of a Pitchess motion.  The Court further found that if a prosecutor identifies Brady  material, he or she must then file a Pitchess motion before disclosing said evidence to the defendant.

On September 18, 2014, the City and County of San Francisco and the San Francisco Police Department (“SFPD”) petitioned the California Supreme Court for review.  The California Supreme Court granted review on October 29, 2014.

The primary issue before the Supreme Court is whether a prosecutor must file a Pitchess motion before accessing peace officer personnel files if the purpose of such access is to search for Brady material that may be subject to disclosure to a criminal defendant.

Criminal defendant, Daryl Lee Johnson, was charged in November 2012 with hitting a female minor in the head in a San Francisco home. After a disclosure by the SFPD that two officers involved with the Johnson arrest had Brady material in their personnel files, the prosecution brought a Pitchess motion.  Criminal defendant Johnson argued to the trial court that Penal Code section 832.7 is unconstitutional to the extent that it bars the prosecution from access to peace officer personnel records to comply with Brady.  The trial court agreed with Johnson and directed SFPD to give the prosecutor access to the peace officers’ personnel records to allow the prosecution to comply with Brady.  The City and County of San Francisco and the District Attorney filed a writ petition challenging the trial court’s decision.

On appeal, the Court of Appeal analyzed Brady and found that it requires the prosecution team to divulge impeachment or exculpatory evidence to the criminal defense, even where the evidence is known only to the police and not to the prosecutors, thereby creating an obligation for the prosecutor to learn of any evidence.

The Court of Appeal drew a distinction between the identification and disclosure stage of the Brady process.  The identification phase requires access to the peace officer personnel files to determine whether Brady material exists.  The Court of Appeal concluded that a prosecutor is not precluded from reviewing the files to identify whether Brady material exists, and does not need to file a Pitchess motion because the disclosure at this stage is not publicly disseminated.  Because the prosecutor and the police are a single prosecution team, prosecutors can examine the records without violating confidentiality, the Court of Appeal said in a 3-0 ruling.  The Court of Appeal further noted when and if the prosecution finds Brady material, then the prosecution’s duty to disclose is triggered and thus, the prosecution must then file a Pitchess motion to determine what material, if any, will be disclosed to a criminal defendant.  The effect of the Court of Appeal’s ruling is that it takes the identification phase out of the hands of the police/sheriff’s departments, and puts it in the hands of the prosecution.

In its Petition for Review to the California Supreme Court, the City and County of San Francisco and SFPD argue that the Court of Appeal’s ruling contradicts published decisions that require a prosecutor to first file a Pitchess motion to get access to otherwise confidential peace officer personnel files.  The Supreme Court granted review on October 29th.  We will continue to update you about this important case.

Tips from the Table: Interacting with City Council

Posted in Labor Relations, Negotiations

We are proud to continue our video series – Tips from the Table. In these monthly videos, members of LCW’s Labor Relations and Negotiations Services practice group will provide various tips that can be implemented at your bargaining tables. We hope that you will find these clips informative and helpful in your negotiations.