Reporting Alternative Work Week
    Votes to the Division of Labor Statistics and Research
IWC Publishes Interim Wage Order - 2000
Why Can't I Get Information From My
    Workers' Compensation Carrier?
Management Liability Expanded

The information provided in this Employment Law Bulletin is for general information purposes only. Any questions about the law and your obligations under it should be reviewed with counsel. If you have any questions about these issues, or any issues confronting employers, please contact:

First, the report must include the company name, phone number, address and contact person. In addition, the report must provide the date of election and information as to whether the election passed or failed, along with numeric election results. There must be a description of the actual alternative work week schedule which was the subject of the election. If more than one person voted, the report must state that the election was held by secret ballot which passed by at least two thirds votes; or , if only one person voted, that the vote was a written ballot in favor of the alternative work week schedule. These reports must be mailed to the Division of Labor Statistics and Research, Attention: Alternative work week election results, P.O. Box 420603, San Francisco, CA 94142.

Administrative, Executive and Professional Employees. In accordance with AB60, the Interim Order changes the criteria for overtime exemptions relating to administrative, executive or professional employees. To be exempt, an employee must be primarily (spend more than 50% of working time) engaged in duties which meet the test for the exemption, and earn a monthly salary of no less than two times the state minimum wage for full-time employment. (An hourly rate is not a salary.) The IWC also provided that registered nurses and pharmacists are no longer eligible for consideration as exempt “professional” employees. Such employees shall not be considered exempt unless they individually meet the criteria established for executive or administrative employees.

Alternative Work Week. The majority of the noteworthy elements in the Interim Wage Order relate to alternative work weeks.

No pyramiding. The IWC clarified that hours used in the calculation of daily overtime pay are not counted in the determination of 40-hour workweek overtime compensation. Once an hour worked is paid at the daily overtime rate, that same hour need not be used in the computation of weekly overtime pay.

A fixed schedule alternative work week. Each proposal for an alternative work week schedule must designate a regularly scheduled alternative work week in which both the specified work days and work hours are fixed and regularly recurring. Where the employer proposes a menu of alternative workweek schedules, its employees must be able to freely choose among work schedule options. After an election, upon the approval of the employer, an employee may move from one menu option to another.

Regularly scheduled alternative work week with recurring overtime. The introductory statement addresses the issue of whether, after the adoption of alternative work week arrangement (no greater than ten (10) hours per day), an employer may require employees to work beyond those alternative hours on a recurring basis. The IWC notes that an employer who requires an employee to work beyond the number of hours established by the alternative work week agreement, even if such overtime hours are worked on a recurring basis, does not violate the law if an appropriate overtime compensation is paid. In other words, overtime must be paid only for hours worked beyond those established in the alternative work schedule. For example, if employees adopt a four/ten schedule and the employer routinely requires them to work eleven hours per day, overtime is due only for the eleventh hour. Note that this position of the IWC is in direct contrast to the Memorandum prepared by the Legal Section of the Division of Labor Standards Enforcement (“DLSE”). The DLSE’s memorandum, however, was drafted before the IWC issued its Interim Wage Order. In a conflict between the DLSE memorandum and the IWC Wage Order, the Wage Order should prevail.

Deviations from the alternative work week scheduled. The IWC was concerned that employers could establish alternative work week agreements and then consistently deviate from the regular schedule without paying overtime compensation to affected employees for work performed beyond eight (8) hours in a day. Thus, if employers send workers home early on a workday that they are scheduled to work beyond eight (8) hours, the employer is required to pay overtime compensation in excess of eight (8) hours on that work day. For example, an employer cannot establish an alternative work week of four (4) ten (10) hour days, anticipating that it will have the flexibility of giving employees up to two hours per day of overtime at the straight time rate. To avoid the overtime premium, the employees must actually work the full ten (10) hour schedule established. If an employee is sent home, for example, after eight and one-half (8 ½) hours on a day which he/she was scheduled to work ten (10) hours, there will be one-half hour which must be considered overtime.

Employee requests to “grandfather” alternative work week schedules in effect before July 1, 1999. As provided in AB60, individual employees can voluntarily continue working alternative schedules existing as of July 1, 1999. The IWC has added the provision that the employee’s written request for employer approval must take place within ninety (90) days of the effective date of the Interim Wage Order (by May 29, 2000). The IWC also provided that an employee may revoke his or her voluntary authorization if the employee provides thirty (30) days written notice to the employer.

Health Care Industry. The allowance of 12-hour shifts without overtime compensation in the health care industry is only valid until the July 1, 2000, sunset date, unless the IWC takes action beforehand.

Make-Up Time. In the interest of employer and employee convenience, the IWC will allow an employee who knows in advance that he or she will be requesting make-up time over a succession of weeks to request make-up work time up to four weeks in advance. There must be a separate make-up time request for each work week, however.

Meal periods. The introductory statement underscores the fact that an employee who works more than six (6) hours in a workday must receive a thirty-minute meal period. This requirement may not be waived by the mutual consent of the employer and employee. The IWC also emphasized that an “on-duty meal period” is permitted only when (1) the nature of the work prevents the employee from being relieved of all duty; and (2) the employee and employer have entered into a written agreement permitting an on-duty meal period. An employee must be paid for the entire on-duty meal period since it is considered time worked.

Posting. Every employer must keep a copy of Interim Wage Order 2000 posted in an area frequented by employees, where it may easily be read during the work day. Where the location of work or other conditions make this impractical, every employer shall keep a copy of the order and make it available to employees upon request. The text of the Interim Wage Order, as well as that of the Statement of Basis are available on the internet at www.dir.ca.gov.iwc.

Effective January 1, 2000, a new California law greatly restricts an insurance carrier’s ability to disclose medical information about an employee who has filed a workers’ compensation claim against the employer. The law provides that, although the insurer shall discuss all elements of the claim filed that affect the employer’s premium, it is prohibited from disclosing any medical information about an employee who has filed a workers’ compensation claim. Two exceptions exist:

• If the diagnosis of the injury for which workers’ compensation is claimed would affect the employer’s premium, then insurer may disclose that diagnosis.
• Medical information may be disclosed if it is necessary for the employer to have in order for the employer to modify the employee’s work duties.

Under the first exception above, however, most insurance companies will likely interpret it fairly narrowly. A “diagnosis” would not include all of the background leading to that diagnosis including much information within the medical report. Therefore, the most likely avenue for receiving such information is when an employer is considering modifying the employee’s work duties either under a light duty program or disability accommodation principles.

The Court’s recent decision holds executives personally liable for such illegal acts where the executive knew, or had reason to know, that the act was illegal and, despite that knowledge, engaged in “meaningful participation” in, consent to, or approval of the illegal conduct.