California employment case index

A firm filed a wage-and-hour class action duplicating one it had already filed elsewhere, then opposed a stay with a brief — drafted by a contract attorney using generative AI — full of nonexistent citations and at least eight fabricated quotations. The First District affirms $6,000 in section 128.7 sanctions: counsel of record bear ultimate responsibility for what they sign, and the duty to verify authority cannot be delegated to any form of technology.

A class of 1,500 customer service managers was denied certification because the trial court believed Labor Code section 2802 liability turned on each employee's own cell phone plan and on who actually paid the bill. Division Two reversed and stated the rule in its opening sentence: when employees must use personal cell phones for work-related calls, the employer must reimburse them a reasonable percentage of the bill, whether the plan is limited or unlimited. Whether a third party paid, and whether the employee changed plans, are irrelevant – plan details go to damages, not liability. The disposition is a reversal of a certification denial, not a merits judgment.

Harte-Hanks paid outside sales representatives higher salaries and commission rates than inside representatives and treated the difference as reimbursement for their automobile expenses. The California Supreme Court held the practice permissible in principle, but only where the employer establishes a means to identify which portion of overall compensation is intended as reimbursement and that portion fully covers expenses actually and necessarily incurred. Section 2804 bars any agreement that waives full reimbursement – a holding that unravelled the trial court's denial of class certification.

In McDonald v. Santa Fe Trail Transportation Co. (1976) 427 U.S. 273, two white employees were discharged for participating in the theft of antifreeze from a shipment in their employer's care, while a Black employee charged with the same misconduct was retained. The Supreme Court held — unanimously as to Title VII, and seven-to-two as to 42 U.S.C. § 1981 — that both statutes protect against racial discrimination directed at any race, including white persons. An employer “may justifiably refuse to rehire one who was engaged in unlawful, disruptive acts against it, but only if this criterion is applied alike to members of all races.” The judgment dismissing the complaint was reversed and the case remanded.