California Supreme Court Upholds Law Eliminating Redevelopment Agencies

Posted by Elizabeth Arce on December 30, 2011

MP900305711_72dpi.jpgThe California Supreme Court issued a ruling upholding a law that eliminated redevelopment agencies throughout the State.  This closely watched lawsuit stemmed from two measures passed by the Legislature last summer to help close California’s budget deficit.  The first measure eliminated more than 400 redevelopment agencies that were funded by property tax dollars.  The second measure allowed these agencies to continue operations but only on the condition that they share part of their property tax revenue with the State.  Although the Court upheld the law eliminating redevelopment agencies, the Court struck down the second measure. 

The Court’s ruling is undoubtedly a blow to cities and counties across the State who rely on redevelopment money to fund improvement projects within their communities.  Thus, public agencies who are already facing financial difficulty should be prepared to deal with additional challenges that may result from the Court’s ruling.  Agencies facing these issues should consider the following points. 

Agencies should be prepared to handle questions from the media and employees about the impact of the Court’s ruling on their financial condition.  For example, questions regarding possible layoff or cuts to public services may arise.  Because of increased scrutiny of public agencies in this “post-Bell” era, agencies must carefully evaluate the impact the Court’s ruling will have on them before responding to any inquiries, and carefully scrutinize how they will address these issues publicly. 

If layoffs are being considered, agencies are reminded to review any language relating to layoffs contained in memorandums of understanding, personnel rules and other policies.  Agencies should pay specific attention to layoff procedures including any timelines associated with the layoff process and the manner in which employees are selected for layoff.  In addition, the agency may have to meet and confer with the bargaining units of represented employees before initiating any layoffs.  Agencies should also think about how the layoffs will be communicated to employees. 

Finally, the loss of redevelopment funding could trigger the need to seek additional cuts through labor negotiations.  Consequently, agencies should prepare a budget summary regarding the agency’s financial condition.  In addition, agencies should familiarize themselves with language in the memorandums of understanding regarding re-opening negotiations and the timeline for conducting negotiations especially in light of the new requirements under AB 646.  

If you have questions, please contact our Los Angeles, San Francisco, Fresno, or San Diego office. 

Balancing Conflicts Between Work And Religion

Posted by Elizabeth Arce on December 29, 2011

Man-on-tightrope.pngRecently, a Macy’s employee was fired because she refused to allow a teenage transgender customer use of the women’s dressing area. Natalie Johnson, who worked at a Macy’s in San Antonio, Texas, watched the teenager shop in the women’s department.  When Johnson saw the teenager in the women’s dressing room, she told the teen “You’re a man,” and that the teen could not change in the women’s area.  

Macys’ confronted Johnson and reminded her that the company’s policy permits individuals to use the dressing room of the gender they identify with.  Johnson said she would not comply with the policy because it was contrary to her religious beliefs.  As a result, Macy’s fired her and Johnson subsequently filed a complaint against the company with the U.S. Equal Employment Opportunity Commission.

While the outcome of Johnson’s complaint remains to be seen, the situation between her and Macy’s highlights the difficulty employers have balancing conflicts between workplace policies and an employee’s religious beliefs.  In order to navigate through these often murky situations, employers should keep the following points in mind.

1.  Religious beliefs must be accommodated.  Both federal and state discrimination laws require employers to accommodate their employees’ sincerely held religious beliefs, practices and observances unless providing the accommodation would create an undue hardship.  The accommodation will usually require the employer to make an exemption from, or adjustment to, the particular workplace policy so that the employee can practice his or her religion.  This can include changing a work schedule, transferring an employee to a different position, or exempting them from a dress and grooming policy.

2.  Employees must request accommodation.  Second, an employee who seeks a religious accommodation must also make the employer aware of the need for an accommodation and that it is being requested because of a conflict between work and religion.  Once the employer is aware of a request for an accommodation, the employer and employee should discuss whether an accommodation is available and can be accomplished without imposing an undue burden on the employer’s business operations.  While holding a discussion is not required under the law, it is a good practice to do so.  For example, it may be difficult for an employer to argue an accommodation would have created an undue burden for it when no discussion about possible accommodations ever took place.

3.  Employers do not have to tolerate business disruptions.  Although employers are required to accommodate employees’ religious beliefs, they are not required to accommodate disruptions to business operations which can include a refusal to assist customers.  For example, in Noesen v. Medical Staffing Network, a pharmacist who refused on religious grounds to fill birth control prescriptions was offered the accommodation of not processing such prescriptions.  The store also arranged for other employees to handle customer inquiries about birth control so that the pharmacist would not have to handle them.  However, despite this accommodation, the pharmacist refused to perform general customer service functions including signaling other pharmacy staff to assist the customer.  For example, when the pharmacist answered telephone calls from customers or physicians about birth control, he put them on hold and refused to alert other pharmacy staff that someone was holding.  He also walked away from customers at the counter and refused to tell anyone that a customer needed assistance.  The Court held that the store’s firing of the pharmacist was justified because his refusal to perform general customer service duties was unreasonable and placed an undue hardship on the employer.

4.  Obligation to accommodate is ongoing.  An employer’s obligation to accommodate an employee’s religious beliefs is ongoing.  An employee’s religious beliefs and practices may grow or lessen during the course of his or her employment.  This might result in requests for different or additional accommodations or in the discontinuance of an accommodation.

Finally, evaluating whether an accommodation would impose an undue hardship requires a case-by-case determination.  Employer’s should consider the facts of each situation including the employee’s job duties, the nature of the employer’s business, and the size and operating costs of the employer.

The First Amendment In Public Employment And Education - Six Issues For The Year 2012

Posted by David Urban on December 21, 2011

2012.png2012 promises to be a significant year for freedom of expression in America, not only because protest movements are expanding across the country in various forms, but also because 2012 is an election year.  And, it will not be just any election, but one involving a “show down” of forces that have railed against each other for years, with rising intensity.

The coming year will also bring significant developments in First Amendment law as it applies to public employers and to educators.  The following are six primary areas worth watching:

1.  Camping and “Occupying” as Protected First Amendment Activity:  Because some public educators are being asked to permit camping on their property as a form of protest, educators will have to watch closely for decisions in this area of the law in 2012.  The forcible removal of a number of occupied camps has led to litigation over the question of whether city actions, and the regulations on which those actions were based, violated the First Amendment.  Under Supreme Court precedent, symbolic conduct itself can qualify as expressive activity meriting First Amendment protection.  The Occupy movement and others have argued that camping on public property now constitutes a mode of expression that should be afforded heightened constitutional protection.  There is, however, already U.S. Supreme Court precedent, the 1984 decision Clark v. Community for Creative Non–Violence, providing that the government may prohibit overnight camping on public property even when the camping is for expressive purposes (in that case, to bring attention to the plight of the homeless).  This fall, a number of district courts addressing Occupy challenges have already applied Clark to enforce government restrictions on overnight camping determined to be content-neutral and reasonable.  Attorneys for protestors nevertheless continue to challenge government enforcement of such regulations, and, it can be argued, they now have more than twenty-five years of precedent since Clark to use to justify a different result consistent with that case’s reasoning.  Significant appellate decisions in this area will likely issue next year.

2.  First Amendment Protection for Falsehoods:  The U.S. Supreme Court will decide soon the unique case of United States v. Alvarez, which concerns the extent to which the First Amendment protects speech that is false.  Alvarez concerns the constitutionality of the Stolen Valor Act, which prohibits individuals among other things from falsely claiming they have won U.S. military distinctions.  The defendant, when speaking in his capacity as a water district board member, falsely boasted that he had received the Congressional Medal of Honor. He was subsequently convicted for violating the Stolen Valor Act.  The U.S. Court of Appeals for the Ninth Circuit (covering California) found that the statute did not pass a “strict scrutiny” standard of review under the First Amendment.  Some judges on the Ninth Circuit, however, expressed the view that the statute, in fact, is constitutional, primarily because speech that is false cannot have First Amendment protection.  They also reasoned that prohibiting false speech does not, except in narrow circumstances, have an excessive chilling effect on protected speech.  The Supreme Court recently decided to review this case. 

A holding by the Supreme Court that false speech can have direct or indirect First Amendment protection may prompt public employees to make free speech retaliation claims in more sets of circumstances.  For example, a broad Alvarez holding could inspire an employee disciplined for knowingly or recklessly wrong speech to claim the speech nevertheless has First Amendment protection precluding discipline, or that the agency rule at issue chills even truthful speech, under expansive Alvarez reasoning.  A clear holding by the Supreme Court that false speech as a general principle lacks constitutional protection would help rule out those types of claims, which in most cases would likely lack merit in any event given the substantial harm false statements can cause in work at public agencies and in schools.  

The Alvarez case is thought to present a close question, however.  For a vivid discussion of supposed First Amendment dangers in statutes like the Stolen Valor Act, see Chief Judge Kozinksi’s concurrence in the Ninth Circuit’s denial of rehearing, which invokes the specter of the “truth police” and lists scenarios in which a “utopia” that allowed criminal prosecution of any falsehood would be “terrifying.”  The U.S. Supreme Court oral argument next year and the Court’s opinion will receive substantial attention from academics, lawyers, the press, and the public. 

3.  The Definition of “Official Duties” for Purposes of Public Employee Free Speech Claims:  Federal courts of appeal will probably also provide a more detailed analysis of what constitutes “official duties” for purposes of free speech claims by public employees.  In 2006, the U.S. Supreme Court held, in Garcetti v. Ceballos, that a public employee cannot assert a free speech claim against his or her employer if the speech at issue was rendered pursuant to “official duties.”  Since 2006, courts across the country have developed sometimes conflicting standards for applying Garcetti.  Some courts, notably the Second Circuit (encompassing New York), have recognized “official duties” to encompass basically anything the employee does in the work context to advance his or her generalized job goals.  In Weintraub v. Board of Education, the standard was considered to include a teacher’s wholly voluntary act of filing a grievance regarding working conditions.  This broad definition of “official duties” may be adopted in the next year in other circuits as well.  

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Court Expands Employers' Ability To Obtain Workplace Violence Restraining Orders

Posted by Guest Author on December 14, 2011

This guest post was authored by Judith Islas

 

Workplace-Violence.jpg

A recent California Court of Appeal ruling provides employers an important weapon to combat workplace violence.  The Court in Kaiser Foundation Hospitals v. Wilson ruled that courts may consider and rely on hearsay evidence to grant workplace violence restraining orders and injunctions.  This is a significant departure from the usual rule that hearsay cannot be admitted into evidence or relied on to support a Court order.

As with all workplace violence cases, the facts are not pleasant.  After Kaiser terminated his wife, Jeff Wilson became irate, started making violent threats toward  Kaiser employees, including that he was  going to “kill someone” “going to flip his lid” and  “do something he would regret.”  Wilson also reportedly told his therapist he was going to shoot a Kaiser employee.  In response, Kaiser sought and obtained a temporary restraining order and then a permanent injunction, barring Wilson from Kaiser facilities and from any contact or communication with Kaiser employees.

Wilson challenged the Court’s temporary restraining order and permanent injunction,  arguing they were based on hearsay statements that cannot be admitted into evidence or relied on by the Court.  Kaiser acknowledged that most of the evidence was hearsay-- threats Wilson reportedly made to employees who did not testify-- but argued courts may consider and rely on hearsay when granting workplace violence restraining orders and injunctions.

In a somewhat surprising, but welcome ruling, the Court of Appeal agreed with Kaiser, expanding an employer’s ability to obtain workplace violence temporary restraining orders and permanent injunctions.  The Court reasoned that under the hearsay rule (Evidence Code section 1200) hearsay is generally inadmissible, “except as provided by law.”  Since the statute governing workplace violence hearings (Code of Civil Procedure section 527.8) expressly provides: “At the hearing, the judge shall receive any testimony that is relevant”  it is one of the exceptions to the general rule that hearsay is inadmissible.  This exception is logical, the Court explained, because the whole point of the workplace violence statute is to prevent workplace violence and the Court’s ability to consider all relevant testimony strengthens its ability to protect employees from violence.

WHAT THIS MEANS TO EMPLOYERS

The Kaiser case increases employers’ ability to obtain workplace violence restraining orders and injunctions, but also increases their responsibility to seek such orders, because employers can rely on any relevant evidence, not only admissible relevant evidence.  If an employer has relevant evidence of violence or credible threats of violence in the workplace, it should not disregard that evidence or decline to seek a restraining order  simply because the evidence is hearsay.  The failure to seek a workplace violence restraining order and permanent injunction when the employer is on notice of violence or credible threats of workplace violence, can result in liability. 

With AB 1028, The Legislature Clarifies The Limits On Post-Retirement Work Opportunities For PERS Retirees

Posted by Guest Author on December 12, 2011

This guest post was authored by Steve Berliner

 

As of January 1, 2012, PERS retirees will have additional restrictions on their ability to work for PERS agencies.  While AB 1028 affects several different Government Code sections, it is garnering the greatest attention for its changes to Government Code sections 21221(h) and 21224; the two statutes that address post-retirement work opportunities and restrictions for PERS service retirees with PERS agencies.

There is no doubt that AB 1028's changes in this area are important and must be followed, but they do not mark any monumental shift in philosophy.  In fact, they are more a clarification of the current law rather than a drastic change in the law.

Government Code section 21221(h) is the section used when the retiree is to be appointed by the agency's governing body.  It currently allows PERS retirees to be appointed for a limited duration to a position deemed by that governing body as requiring specialized skills or during an emergency to prevent stoppage of public business.  A retiree can be appointed for a term not to exceed one year, AND may not work more than 960 hours in a fiscal year (July 1- June 30).  There is an ability to exceed 960 hours in a fiscal year if a request is made to PERS before the 960 hour limit is exceeded and PERS does not deny the request.  There is no mechanism to request that the one year term be exceeded.  Section 21221(h) has generally been used to fill high level vacancies for positions that are appointed by the governing body, such as City Manager, Police Chief, Fire Chief, etc., with a retiree who is willing to work for a short period of time.  This arrangement helps the agency fill that position while a permanent replacement is sought.  However, section 21221(h) has not always been used solely for this purpose and the current statutory language does not explicitly limit it to that arrangement.

AB1028 simply takes the standard scenario described above and makes it the sole basis for post-retirement employment under the statute.  Moreover, if there was any question about whether the one year limitation on post-retirement employment could be circumvented by simply reappointing the retiree to another one year term, AB 1028 explicitly prohibits subsequent appointments.  Lastly, AB 1028 limits the retiree's compensation to the maximum published pay schedule for the vacant position. 

Changes to Government code section 21224 are even more modest.  This section does not require appointment by the governing body, but it does require appointments be for a limited term.  Currently, these appointments implicitly required specialized skills for the post-retirement appointment to be lawful.  That implication was derived from the heading of the section, although the plain language of the actual statute did not contain this requirement, only requiring the work to be in an emergency or because the retiree had needed "skills."  AB 1028 adds the special skills requirement in the actual statutory language.  It also reinforces the limited term restriction by added that the appointments shall be temporary.  It made no other changes to that statute.

AB 1028 does not affect any of the other limitations on post-retirement work, such as those applicable to retirees who retired before reaching normal retirement age or the limitations applicable to retirees who recently received unemployment insurance.

PERB Adopts Proposed Emergency Regulations On Mandatory Factfinding

Posted by Guest Author on December 09, 2011

This guest post was authored by Bruce A. Barsook


Yesterday (December 8), the Public Employment Relations Board (PERB) adopted proposed emergency regulations to implement AB 646 (Chapter 680, Statutes of 2011), the recently enacted legislation requiring factfinding in bargaining disputes under the MMBA.  The emergency rulemaking package now will be submitted to the Office of Administrative Law (OAL) for its review and approval.

AB 646 imposes mandatory factfinding upon the request of an employee organization when a bargaining impasse is reached.

Prior to the December 8 meeting, PERB invited interested parties to submit proposed regulations and other commentary regarding the implementation of the statute.  LCW and other interested parties, including management and labor firms and organizations, submitted proposed regulatory language, as well as comments.  A copy of LCW's proposed regulations and commentary is posted on the PERB website and here.

The proposed emergency regulations provide that if the parties mediate and such mediation does not resolve the negotiations impasse, a factfinding request may be filed not sooner than 30 days but not more than 45 days, following the appointment of the mediator.  Obtaining an outer time limit was an important goal for public sector management, as we argued that an unreasonable delay in the process would frustrate the purposes of the MMBA and be inconsistent with timely resolution of bargaining disputes.

An unresolved question in the new statute is whether an employee organization may demand factfinding (and thereby delay a unilateral imposition of terms and conditions of employment by the local agency) in the absence of the parties using mediation.  At the December 8 hearing there was some uncertainty as to how PERB (or the courts) would handle such a situation.  The issue may have to be resolved through litigation (or "clean-up" legislation).  Notwithstanding the uncertainty in the law, PERB adopted a proposed regulation related to this issue.  The proposed regulation provides that if the parties do not use mediation, the request for factfinding must occur within 30 days following the declaration of impasse.  Although those who believe the statute does not require factfinding in the absence of mediation will not be pleased with such a regulation, all parties will find some benefit from the addition of clarity as to whether there is a time period for submission of factfinding requests.

PERB has indicated that it intends to submit its proposed rules to OAL on December 19, 2011.  Once the proposed emergency rules are filed with OAL there will be a five day comment period.  If OAL accepts the emergency rulemaking package it will be filed with the Secretary of State at which time the regulations will become effective. 

Further information can be obtained from the PERB website, and of course, we will keep you posted.  In the meantime, if you have any questions please contact one of our labor relations attorneys at any of our four offices.

Pandora's Box Opens - California Supreme Court Rules Vested Health Benefit Rights For Retired County Employees Can Be Implied

Posted by Guest Author on December 01, 2011

This guest post was authored by Judith Islas

Pandora's box

The California Supreme Court recently opened the door to a new way employees and retirees can sue local public agencies.  The Court held that employees and retirees may have implied contractual rights.  Retired county employees may even have an implied contractual right to vested health benefits, although there is no ordinance, resolution or MOU expressly providing that right.

For years, Orange County combined active and retired employees into a single pool to calculate health insurance premiums.  Retirees benefitted from paying less than if they were pooled separately; however, active employees subsidized retirees by paying more. In 2007, the County split the pool, resulting in increased retiree premiums.

The retirees sued to stop the County from splitting the pool. There was no MOU, resolution or ordinance requiring combined pooling, so in the absence of an express requirement, the retirees claimed there was an implied contract requiring shared pooling.

The County argued the retirees could not sue based on an implied contract theory because public employment rights are created by state laws, local ordinances and resolutions, and not by contract. The Supreme Court disagreed, ruling that public employment can be governed both by laws and contracts, as long as any contracts are not inconsistent with the applicable laws or local legislative enactments.  The Court noted various laws authorizing local agencies to enter into employment based contracts, thereby allowing employee rights to be based on both statutory and contractual obligations.

The Court ruled a contract creating employment rights can be express-- based on words-- or implied-- based on conduct, including conduct reflecting the parties’ intent.  This means a county and its employees may form implied in fact contracts, including one creating vested retiree health benefit rights.  Thankfully, the standard for proving an implied contract is high and can only be established by showing that a right is clearly implied by a County ordinance or resolution or there is other convincing evidence of an implied contract.   Further litigation will determine whether the retirees in this case can prove existence of an implied contract to provide a vested right to a unified pool for health premiums.

CAUTION: The Court’s reasoning in Retired Employees Association of Orange Co. v. County of Orange can be used by county and other local agency retirees and employees to claim they have various implied contractual rights. In a time of economic turmoil, local agencies will want to act cautiously to avoid creating unanticipated and unwanted implied contractual obligations that may create unfunded and unanticipated liabilities.

Some TIPS to protect against implied contract claims are:

  • Clear language in MOUs, ordinances and resolutions, as implied contracts cannot be established if they contradict express language
  • Language in MOUs, ordinances and resolutions that expressly denies the creation of or intent to create any benefits or rights not expressly stated in writing
  • Be sure to comply with all applicable MOUs, ordinances, and resolutions
  • Do not provide benefits and rights not set forth in MOUs, ordinances or resolutions
  • Carefully review newsletters, pamphlets and other written communications to monitor for unintended statements, representations or promises that could be used to support an implied contract claim 

 

Photo Courtesy of Creative Commons by Christiaan Botha