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Two Important California Appellate Rulings May Affect CALPASC Members

Friday, September 14, 2018   (0 Comments)
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Two Important California Appellate Rulings May Affect CALPASC Members


Oscar Peredia et al v. HR Mobile Services, Inc.


The first ruling was from the Fifth Appellate District, in Oscar Peredia, et al v. HR Mobile Services, Inc. The decision was published July 30, 2018.


The case involves the tragic death of a dairy employee who was run over and killed by a front-end loader.

The Justices brought safety consultants into a new legal liability that no California Appellate Court had given them before.


CALPASC is very concerned that the ruling could result in significant changes to how safety consultants provide services.


The ruling applies not just to independent safety consultants; but also those providing services on behalf of insurance companies, insurance brokers, and others.


CALPASC Director of Risk Management Bruce Wick is involved with a stakeholder group of employers, employer representatives, and safety consultants. This group is assessing the likely impact of this ruling, and possible ways either for employers and safety consultants to deal with the ruling, or ways to change this law or the interpretation by this Appellate Court.


The court instituted the liability of allowing an employee or their survivors to directly sue an employer's safety consultant for negligent undertaking. The law involving negligent undertaking is fairly complicated, but the primary points as related to safety consulting are as follows:

  1. Several elements of establishing a negligent undertaking case will almost always be involved in safety consulting.
    1. The Safety Consultant is providing a service.
    2. The Safety Consultant has an awareness that their services are necessary for the protection of employees.
    3. The liability is triggered only if an employee suffers an injury or fatality.
    4. The elements that prove liability or not will be hard to avoid by summary judgment. Therefore, almost every lawsuit filed will have to go through the litigation process. The employer will have almost no ability to ask for summary judgment.
    5. The factual discussion over liability will involve these questions:
      1. Did the Safety Consultant fail to exercise reasonable care in its duties, being shown by any one of the following three items being proved:

a. The carelessness increased the risk of harm to the employee. (The example in this case is if the Consultant had recommended high visibility clothing for all employees of a dairy, the loader operator might have had more awareness of where employees were working, and might not have run over a worker they did not see.)The question is, how far do the recommendations have to go, before there is no possibility of increasing the risk of harm?


b.The failure to exercise reasonable care was while the Safety Consultant was performing a duty owed by the employer to its employees. Most safety consulting is to augment and assist an employer in that employer's duties to its own employees.


c.The harm was suffered because of reliance of the employer or employee on the recommendations of the Safety Consultant. Almost by definition, the Safety Consultant has expertise that is being requested, and will most likely be relied upon.


Please keep Bruce Wick appraised of any changes being proposed by any Safety Consultants or groups like insurers who provide safety consulting., or 909-793-9932.


You can click to a copy of the ruling HERE.



Sandra Diaz, et al; v. Grill Concepts Services


The second ruling was given by Division Two of the Second Appellate District, on May 24, 2018. The case is Sandra Diaz, et al; v. Grill Concepts Services.


The Justices here made clear what constitutes a "willful" violation resulting in waiting time penalties when employees quit or are fired/terminated/laid off; and whether a local Superior Court has the authority to relieve an employer of waiting time penalties if the employer made "good faith efforts".


Unfortunately the Justices answered harshly on both issues.

The facts of the case involved Grill Concepts being in an "Airport Hospitality Enhancement Zone" that required a living wage be paid. The amount of the wage was increased annually, but the percentage of annual increase was changed after the law was first instituted. Grill Concepts never found out how the new formula worked, and therefore underpaid all employees. After the employee filed a class action suit, the employer immediately paid all current and former employees the amount of wages owed.


The question was whether waiting time penalties(which can be up to 30 days of the employees' wages) were due to former employees.


The court said that Grill Concept's efforts to find out the revised formula were "halfhearted", fall under the standard of care; and are therefore "willful". In the Justices minds, Grill Concepts should have:

  • Followed up with the City Attorney's Office. Grill Concepts had contacted them when the changes were being made, before being finalized, but never recontacted them.
  • Contacted other hotels or restaurants located in the Zone, as to what the living wage was.
  • Done more legal research to find out the formula.

The court then went on to say that a Superior Court doesnothave the discretionary power to waive the waiting time penalties if they feel the employers tried in "good faith" to pay the right wage. The employer would have to show that they were not "willful" as "willful" is defined and interpreted under the Labor Code, to be relieved of waiting time penalties.


CALPASC strongly recommends that members visit this area with their labor attorney or consultants to make sure your practices avoid waiting time penalties for violations of various municipal and other ordinances.


Click HERE for a copy of the ruling.


The California Labor Commissioner issues citations of $1.9 Million against a Southern California Drywall Contractor for overtime, rest period, and minimum wage violations!

Fullerton Pacific Interiors, Inc. worked on 26 projects over a three year period, involving 472 workers. $72,400 of the amount cited is for civil penalties. $1,892,279 is payable to the workers, broken down as follows:


1.Failure to provide rest periods


2.Failure to provide compliant wage statement


3.Failure to pay overtime


4.Failure to pay minimum wage



CALPASC members are reminded of the importance of compliant wage statements, paying overtime properly, and confirming that rest periods are provided to employees.


Access a copy of the Labor Commissioner press release HERE.

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