I’ve been sued. Now what do I do? | By Daniel G. Emilio

You’ve been sued?  Don’t be surprised.  You aren’t alone.  You are in the most litigious state in the country, and our beloved state legislators are falling over themselves to make it easier to sue you and create ever-more curious and bizarre laws.  You are a target.  Plaintiff attorneys are falling over themselves looking for clients who may have even the smallest of claims – if there are attorneys’ fees available at the other end.  That is, many laws provide that if they prevail on even the smallest lawsuit, the attorney fees by themselves can be awarded by the court of amounts of $25,000, $50,000, $100,000 or more.  This is the environment in which we live.  So, how do you protect yourself?  There are 3 ways.


First, with respect to employees, you must have an arbitration agreement in place for every employee and if you have more than 20-30 employees, the arbitration agreement must have a “Class Action Waiver” built-in.  If you have an arbitration agreement and you are sued, then you have the option to compel arbitration or simply contest the lawsuit in court.  The advantage of arbitration is that there is no jury and if you do lose, the arbitrator will probably award the plaintiff less than a jury would (no guarantee).  Arbitration agreements are especially useful in cases such as wrongful termination, sexual harassment, and discrimination cases (race, age, sex, etc).  However, if it’s a small wage claim, then we wouldn’t want to go to arbitration because you have to pay the arbitrator’s fees in employment cases.


Also, you may need an Arbitration Agreement built-in to your sales contracts with your customers.  Even restaurants have been sued by customers in class actions and other cases.  Arbitration Agreements don’t cost you anything and it could save you a great deal of money.  There are some attorneys who won’t want to work on arbitration cases because there is no threat of a jury.  I’ve actually had one attorney dismiss a wrongful termination case in its entirety after I filed a motion to compel arbitration.


Second, you must become aware of the most common business lawsuits, and make sure that you are not violating them.  This includes understanding wage laws, overtime, meal and rest breaks, when and how to terminate someone.  The best way to do this is to have a consultation with an employment attorney to go over these issues and others.  As for myself, there is no charge for the consultation.  Also, there are other common lawsuits of which you should be aware.  Americans With Disability lawsuits (ADA) are very common and usually involve a lack of or improper handicap parking spots and proper signage as well as restroom requirements, ramps, etc.  You can get an inspection of your facility by a certified CaSP inspector, who will go to your facility, advise you of any violation, and, when corrected, provide you with certificate to protect you from these lawsuits. (I’ve heard the cost may be as little as $600 so check around.  Google “CaSP Inspection” and then click on “Certified Access Specialist List – State of California.)  There are dozens of attorneys who have disabled clients who drive up and down every street in every county (and even use Google Street View) to look for violations so they can bring a lawsuit.

Other common lawsuits involve trademark and patent infringement.  These include, for example, a sports bar showing a cable sports event but failing to buy the license to show the event, or selling products that look similar to patented products (e.g., ladies Coach bags, designer shoes, etc).  Also, if you produce or sell a product in California that has a certain amount of a designated chemical or compound built-in, you may be the target of a Proposition 65 lawsuit.  This is very common if you import products from China or other countries.


Third, if you have been sued, the most important thing is to get out of the lawsuit as soon as reasonably possible.  I don’t care if you did nothing wrong and the lawsuit is a total sham; the problem is that you simply have to defend the lawsuit.  If you are taking it personally, then stop it.  This is business.  Lawsuits happen.  And don’t take the very common position that “I would rather pay my attorney a million dollars before I pay that so-and-so one red cent.”  This is business and you have to take a common-sense business approach that it is sometimes better to pay the plaintiff something than to pay your attorney tens of thousands.  And you have to seek out an Attorney who will talk to you like that.  An attorney who starts talking Trial tactics and how you are going to win at trial is doing you no favor.  You need an attorney that views you as someone who needs legal help rather than looking at you as another billable event.

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NEW EMPLOYMENT LAWS FOR 2014 | Daniel G. Emilio, Esq.


January is Bustin’ Out All Over with new employment laws for 2014.


Minimum Wage Increases:  The State minimum wage rises from $8.00 per hour to $9.00 per hour effective July 1, 2014.  This also means that exempt workers’ salary will increase to a guaranteed salary of not less than $37,440 per year ($720 per week or $3,120 per month).  The minimum wage will increase again to $10.00 per hour on January 1, 2016.  Exempt salary will be $41,600 per year ($800 per week or $3,466.67 per month).  This is important because if you fail to pay the proper salary the manager or exempt person becomes non-exempt and you have to pay them overtime – even though they are receiving a salary!!


Also, San Jose minimum wage increases to $10.15 per hour and San Francisco minimum wage increases to $10.74 per hour.


Computer software workers must receive $40.38 per hour to be exempt from overtime pay requirements.


Some licensed physicians and surgeons will remain exempt from overtime if they receive at least $73.57 per hour.


Higher Penalties for Failure to Pay Minimum Wage:  Existing law allows the Labor Commissioner to recover liquidated damages for failure to pay minimum wage.  New law (Labor Code sections 1194.2 and 1197.1) expands the damages to be paid to the employee.  The penalty for the initial violation is $100.00 for each underpaid employee for each pay period for which the employee is underpaid and increases to $250.00 for each subsequent violation.


Definition of Sexual Harassment ChangedAn employee now does NOT have to prove that the harassment was motivated by a sexual desire.


Time Off for Victims of Stalking and Domestic Violence:  New law now requires employers to provide reasonable accommodations to employees who need time off to attend court appearances or obtain counseling and related services.  Current law already requires employers to provide time off for employees to attend to issues arising from domestic violence and sexual assault.


Veteran Status Added to FEHA:  New law now adds Veteran Status as a protected category to discrimination cases and provides remedies similar to other protected categories, such as pregnancy, race, age, etc.


Immigrant Driver’s Licence:  New law allows undocumented persons to lawfully obtain driver’s licenses, with proof of residency and other requirements.  The licenses cannot be used to establish eligibility for employment.


In-Home Caregivers Entitled to Overtime:  New law modifies the personal attendant exemption requiring caregivers to receive overtime when they work more than 9 hours in a day or 45 hours per week.


Increased Penalty for Retaliation:  New law changes Labor Code 98.6, which prohibits retaliation against an employee who has complained about his or her wages to the employer or state agency, and now subjects employer to a $10,000 civil penalty.  Also the law makes clear that employees are not required to exhaust administrative remedies prior to bringing claims under 98.6 and 98.7.


Unfair Immigration Practices:  New law (Labor Code sec 1019) prohibits employers from directing others to engage in “unfair immigration-related practices” including requesting more or different documents than are required under Federal law for verifying applicant’s ability to work, or refusing to honor employment verification documents that reasonably appear to be genuine, using the federal E-Verify system at a time or manner not required by federal law, or threatening to file or filing a false police report or threatening to contact or contacting immigration authorities.


More Rest and Meal Breaks:  New Law requires employers to provide additional 5 minutes to meal and rest breaks when temperature exceeds 85 degrees.


Clarified Sleep Time Rules:  Per Appellate court ruling, Employers may not have to pay for up to 8 hours of on-call sleep time if: 1) the employee is working a 24-hour shift, 2) the employee is provided a comfortable place to sleep, 3) the employee regularly receives at least 5 hours of uninterrupted sleep, and 4) there is an agreement (oral, written or implied) that the employee will not be compensated for sleep time.  (Highly suggested to put such agreements in writing and that employee may rescind such agreement in writing.)


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