Issue 1 - 2004

Senate Bill 1661 established a paid family medical leave program for all workers. The leave program is established, administered and funded through the State Disability Insurance (SDI) program. The benefit is fully funded through contributions by the employee. SB 1661 went into effect on January 1, 2004, with the benefits applying to leaves beginning on or after July 1, 2004.

Within the state disability insurance program, a family temporarily disability program is funded by means of workers' regular SDI deductions. This program provides up to 6 weeks (in a 12 month period) of partial wage replacement benefits to workers who take time off work to care for a seriously ill child, spouse, parent, domestic partner, or to bond with a new child.

The benefit is the same amount - 55% of a worker's wages up to $728 per week - as the normal State Disability Insurance (SDI) benefit for the worker's own disability. (The maximum benefit will increase over the next two years as it is indexed to the workers' compensation benefit). All employees currently covered under California's SDI plan are eligible for the program.

Key provisions of the bill include:

• A one-week waiting period before workers can apply for the program.
• Employers can require employees to use up to two weeks of unused vacation time before receiving paid leave.
• Payments are capped at six weeks over a 12-month period and at 55 percent of wages, up to an annually-adjusted maximum.
• The new law gives no leave rights, only benefits. As in the original federal and state Family Leave laws, small businesses with less than 50 employees generally are not required to hold a job open for a worker on leave. However, employees of small businesses are still eligible for payments from the state.
• Employers must provide employees with an explanatory handout from the state. The handout is available from the Employment Development Department at:
  http://www.edd.ca.gov/direp/de2511.pdf
• Employers must also post EDD's updated 1857A (Rev. 35) which includes information on Unemployment Insurance, State Disability Insurance and the new Paid Family Leave benefit. The website link to the EDD poster DE 1857A (Rev. 35) is:
  http://www.edd.ca.gov/uirep/de1857a.pdf.

A federal court recently ruled that working at home was not a reasonable accommodation where an employee would not be able to perform all of the essential functions of her job. (Mason v. Avaya Communications, Inc.)

In 1986, while working as a mail carrier for the United States Post Office, Diane Mason witnessed the murder of several of her then co-employees. A doctor subsequently diagnosed Mason with post traumatic stress disorder, and Mason ultimately resigned because working for the postal service aggravated the symptoms of her disorder.

In 1998, Avaya Communications, Inc. hired Mason as a service coordinator. In 2000, one of Mason's co-workers, Kevin Lunsford, pulled out a knife during a verbal confrontation with another Avaya employee. Mason did not witness this incident, but heard of it through her co-workers, who also told her that Lunsford had made previous threats in the workplace. After learning that Lunsford was to return to work at Avaya following a suspension, Mason, supported by her doctors, informed Avaya that she continued to suffer from post traumatic stress disorder and was physically and emotionally unable to work with Lunsford. Mason requested that Avaya accommodate her disorder by (1) relocating Lunsford, (2) allowing her to work at another facility or (3) allowing her to work at home. After concluding that relocating Lunsford was not an option and that no positions were available at other facilities, Avaya informed Mason that she could not work at home because physical attendance was a function of a service coordinator's job.

In 2001, Avaya discharged Mason because she was unable to return to work. Mason filed a lawsuit against Avaya alleging that in denying her request to work at home, Avaya violated the Americans with Disabilities Act (ADA) by failing to reasonably accommodate her disability. The district court dismissed Mason's claim and she appealed.

The court ruled that working at home is not a reasonable accommodation if the employee cannot perform all of the essential functions of her position. The court found that Avaya could not adequately supervise Mason if she was at home. Even though technology would allow Avaya to tell if Mason was logged into her computer, Avaya's supervisors would not be able to ascertain what she was doing (i.e., work-related versus non-work-related activities) while logged in. The court also found credible Avaya's argument that teamwork is an essential function of the position because service coordinators typically assist and cover for one another. Finally, the court stated that it was "in no position to second guess Avaya's desire to directly supervise its lower level employees" at "a time when employers are justifiably concerned with productivity at the workplace." Because (i) the court found that physical attendance at the workplace was an essential function of Mason's position, and (ii) under the ADA, Avaya is not required to eliminate or change the essential functions of Mason's position in order to accommodate her disability, Mason's request for an at-home accommodation was, as a matter of law, unreasonable.

Tip for Employers: Be careful before denying an employee's request to work at home. In some situations, it may be a reasonable accommodation. To help support an argument that physical presence at the workplace is an essential job requirement, consider including it in the written job description, if applicable.

A recent California court decision underscores the importance of timely written employment offers. (Blitz v. Fluor Enterprises, Inc.) A manager at Fluor Enterprises, Inc., Doug Cheppo, approached Blitz regarding employment on a California-based project for Fluor. Cheppo anticipated the project would last from two to three years. At the time, Blitz was working for Raytheon (where he had been employed for approximately twelve years). Blitz was not interested in relocating to California for a project-based job. Rather, he wanted long-term employment. He conveyed this to Cheppo. Cheppo indicated that he would need to speak with another manager, Ron Albright, about long-term employment with the Company (and would also need to get Albright's approval). Blitz flew to California for interviews with the Company. Cheppo then informed Blitz that Albright had approved his employment with the Company on a long-term (as opposed to project-specific) basis. Cheppo never informed Blitz that his employment with the Company would be at-will. Blitz accepted Cheppo's oral offer of employment and, because Cheppo was pressuring him to begin work as soon as possible, tendered his resignation to Raytheon the next day. Fluor presented Blitz with a written employment agreement containing an at-will provision after he had orally accepted employment with the Company and after he had been tendered his resignation to Raytheon. Blitz objected to the at-will language and sought to have the language replaced with language reflecting his long-term employment with the Company. Fluor refused. However, Cheppo assured Blitz that Fluor would not enforce the at-will provision. Since he had already resigned his position at Raytheon, Blitz had little choice but to sign the Employment Agreement. He did so and commenced work with Fluor.

Blitz worked for Fluor for approximately two years before he was terminated after work on his assigned project began winding down. Blitz sued Fluor for negligent misrepresentation, violation of Labor Code 970 (prohibiting inducing a person to relocate within California or outside of California for employment through or by means of a knowingly false statement) and fraud.

Fluor argued that Blitz could not enforce an implied agreement of long-term employment contradicting his written at-will Employment Agreement. Under California law, "Terms set forth in a writing intended by the parties as a final expression of their agreement ... may not be countered by evidence of any prior agreement or of a contemporaneous oral agreement." CCP 1856(a) (emphasis added). This rule does not apply in certain limited circumstances, however, such as where the evidence establishes illegality or fraud. However, this "fraud" exception is inapplicable to cases where the evidence sought to be introduced pertains to promises directly at variance with the writing. This is based on the assumption that the parties to the written agreement had the ability to protect themselves from the alleged fraud at the time they entered the agreement by insisting that the agreement accurately reflect the promises.

The trial court found in favor of Fluor on the grounds that Blitz's written Employment Agreement superseded Cheppo's verbal commitments to Blitz. The appellate court reversed, noting that the case was not based upon Cheppo's additional assurance at the time Blitz signed the Employment Agreement, i.e., a promise at variance with the written agreement. Rather, Blitz had relied on Cheppo's assurance of long-term employment when he resigned his position from Raytheon. Having quit his job based on the promise of long-term employment, Blitz was placed in a position whereby he had to sign the Employment Agreement contradicting the terms of the oral agreement. The appellate court further found that Fluor had obtained Blitz's services by promising long-term employment and would be unjustly enriched if it were allowed to retain the benefit of Blitz's employment "with no repercussions."

Tip for Employers: Employers must not only set forth all offers of employment in writing, they must do so in a timely manner. Had Blitz not been given a verbal offer, but instead been given a written at-will offer before resigning from Raytheon, Flour should have prevailed.