Justia Labor & Employment Law Opinion Summaries

An employee suffered a back injury while working as a loader and material handler, which required him to lift heavy objects. After the injury, he received medical treatment and was placed on a weight restriction but continued working for the same employer at a slightly higher wage. Later, he voluntarily left that job for personal reasons and obtained new employment at higher wages. The employee eventually filed a claim for workers’ compensation benefits, and medical evaluations determined he had a permanent impairment to his back.A deputy workers’ compensation commissioner found that the employee had an 8% functional impairment and, applying the “industrial method,” determined the employee had a 15% loss of earning capacity, awarding permanent partial disability benefits accordingly. The workers’ compensation commissioner affirmed this decision. The employer and its insurance carrier sought judicial review, arguing that the benefits should have been calculated based on functional impairment rather than loss of earning capacity. The Iowa District Court for Polk County denied the petition for judicial review, agreeing with the commissioner’s use of the industrial method. On appeal, the Iowa Court of Appeals affirmed the district court’s judgment, holding that the industrial method was appropriate and that substantial evidence supported the finding of a 15% loss of earning capacity.The Supreme Court of Iowa reviewed the case and held that, under Iowa Code section 85.34(2)(v), when an employee with a nonscheduled injury returns to work or is offered work at the same or greater earnings as at the time of injury, compensation must be based solely on the employee’s functional impairment, not on loss of earning capacity. The court vacated the decision of the Court of Appeals, reversed the district court’s judgment, and remanded the case for calculation of benefits based on functional impairment. View "Den Hartog Industries v. Dungan" on Justia Law

The plaintiff, a former employee, brought a lawsuit against his employer alleging multiple claims of discrimination and harassment. The employer successfully moved to compel arbitration pursuant to an agreement between the parties. During the arbitration, the arbitration provider issued an invoice for fees, which the employer attempted to pay electronically on the last day of the statutory 30-day deadline. However, due to a processing delay, the payment was not received by the provider until three days after the deadline.The Superior Court of Los Angeles County found that the employer’s failure to ensure the arbitration fees were received within the 30-day period constituted a material breach of the arbitration agreement under California Code of Civil Procedure section 1281.98. The court vacated its prior order compelling arbitration, returned the case to court, and awarded the plaintiff $1,750 in sanctions for expenses incurred in bringing the motion. The plaintiff then sought over $300,000 in attorney fees and costs under section 1281.98, subdivision (c)(1), which allows recovery of all fees and costs associated with an abandoned arbitration. The trial court granted only a reduced amount, reasoning that the plaintiff was entitled only to fees and costs for work rendered useless by the termination of arbitration.On appeal, the California Court of Appeal, Second Appellate District, Division One, considered the impact of the California Supreme Court’s decision in Hohenshelt v. Superior Court (2025) 18 Cal.5th 310. Hohenshelt held that federal law preempts a strict application of section 1281.98, and that forfeiture of arbitral rights occurs only if the failure to pay fees is willful, grossly negligent, or fraudulent. The appellate court determined that the employer’s late payment was not willful, grossly negligent, or fraudulent, and therefore, the plaintiff was not entitled to attorney fees under section 1281.98, subdivision (c)(1). The order awarding attorney fees and costs was reversed. View "Wilson v. Tap Worldwide, LLC" on Justia Law

Jay Gould served as CEO of Interface, Inc., a carpet manufacturer. After an incident at an annual sales meeting in which Gould allegedly became intoxicated and verbally abused an employee, Interface’s board of directors terminated his employment for cause. This followed a prior warning and an investigation by King & Spalding LLP, which corroborated the allegations. Under Gould’s employment agreement, termination for cause resulted in significantly reduced compensation compared to termination without cause.Gould filed suit in the United States District Court for the Northern District of Georgia, alleging breach of contract and arguing that Interface’s determination of cause was made in bad faith. Interface moved for summary judgment, asserting that the contract gave it absolute discretion to determine cause, or, alternatively, that it had acted in good faith. Gould’s arguments in the district court focused on the company’s alleged lack of good faith, contending that the investigation was a sham. The magistrate judge recommended granting summary judgment to Interface, finding both that the company had absolute discretion and, alternatively, that Gould had not shown bad faith. The district court adopted this recommendation and denied Gould’s subsequent motion for reconsideration, ruling that Gould had waived a new argument that Interface had no discretion to determine cause.On appeal to the United States Court of Appeals for the Eleventh Circuit, Gould advanced the new theory that Interface had no discretion to determine cause under the contract. The Eleventh Circuit held that this theory was a new issue, not a subsidiary argument, and that Gould had forfeited it by failing to raise it in the district court. The court affirmed the district court’s judgment, concluding that Gould’s remaining claims did not warrant reversal. View "Gould v. Interface, Inc." on Justia Law

A group of nurses directly employed by the City and County of San Francisco, represented by their union, brought a class action alleging that the City failed to comply with Labor Code section 512.1, which requires public sector healthcare employers to provide meal and rest breaks and pay premiums for missed breaks. The nurses claimed that since the law’s effective date, the City had not provided the required breaks or compensation. The City and the union had previously negotiated a memorandum of understanding (MOU) that set out meal and rest break provisions and remedies for missed breaks, but the nurses argued these did not satisfy the new statutory requirements.The Superior Court of California, City and County of San Francisco, sustained the City’s demurrer, agreeing with the City’s argument that section 512.1 did not clearly apply to charter cities like San Francisco. The court did not address the City’s alternative constitutional argument regarding home rule authority. The nurses appealed this decision.The California Court of Appeal, First Appellate District, Division Four, reviewed the case. The court held that the statutory language defining “employer” in section 512.1 was ambiguous as to whether it included charter cities and counties such as San Francisco. The court found that neither the statutory text, legislative history, nor legislative findings demonstrated a clear intent by the Legislature to override charter city home rule authority or to apply section 512.1 to charter cities. The court also noted that when the Legislature intends to regulate charter cities, it does so explicitly, which was not the case here. Accordingly, the Court of Appeal affirmed the trial court’s judgment, holding that section 512.1 does not apply to the City and County of San Francisco. View "Levy v. City and County of San Francisco" on Justia Law

After a theft occurred at a licensed marijuana-growing facility in Adelanto, California, the employer, Kavry Management, LLC, required several employees, including Steven McDoniel, to take a polygraph test. McDoniel, who was not advised of his right to refuse the test, took and “failed” two polygraph examinations. He was subsequently terminated from his position, with evidence indicating the termination was due to the polygraph results. McDoniel experienced significant emotional distress and concern for his reputation in the industry following his discharge.The Superior Court of San Bernardino County reviewed McDoniel’s claims for wrongful termination in violation of public policy, defamation, and violations of Labor Code sections 432.2 and 1198.5. The court granted summary adjudication for the employer on the defamation and PAGA claims, and on punitive damages, but allowed the wrongful termination and Labor Code claims to proceed. At trial, the jury found Kavry liable for wrongful termination in violation of public policy and for violating Labor Code sections 432.2 and 1198.5, awarding McDoniel $100,000 in noneconomic damages. The court also imposed a penalty for the personnel records violation and awarded McDoniel attorney fees under section 432.6.The California Court of Appeal, Fourth Appellate District, Division One, held that an employer’s violation of Labor Code section 432.2—requiring or demanding an employee to submit to a polygraph test as a condition of continued employment—supports a claim for wrongful discharge in violation of public policy. The court affirmed the jury’s award of noneconomic damages. However, it reversed the attorney fee award, finding that section 432.6 did not apply retroactively to McDoniel’s employment, which ended before the statute’s effective date. The court also upheld the denial of attorney fees under the private attorney general statute and found McDoniel forfeited his claim for fees under PAGA. The judgment was affirmed in part and reversed in part. View "McDoniel v. Kavry Management" on Justia Law

An employee of a large retail company alleged that, during her six-week employment at a California store, she was denied meal and rest breaks, not paid for overtime, did not receive proper wage statements, and was required to use her personal cell phone for work without reimbursement. She filed suit in state court, asserting individual, putative class, and Private Attorneys General Act (PAGA) claims for violations of California’s Labor Code. The company removed the case to federal court.The United States District Court for the Central District of California dismissed several of the plaintiff’s class claims and denied class certification for the remaining class claim. The plaintiff continued to pursue her individual and PAGA claims. Shortly before trial, the parties settled the individual claims for $22,000 under California Code of Civil Procedure section 998, with the plaintiff dismissing her PAGA claims without prejudice. The settlement allowed the plaintiff to seek reasonable attorneys’ fees and costs for work performed on her individual claims, as permitted by law. The district court awarded the plaintiff $297,799 in attorneys’ fees and $14,630 in costs, after she voluntarily reduced her fee request by nearly half to exclude time spent on class certification and legal assistants’ work.On appeal, the United States Court of Appeals for the Ninth Circuit held that the section 998 settlement agreement did not preclude the plaintiff from seeking attorneys’ fees for work on related claims under the standard set forth in Hensley v. Eckerhart, as long as those claims were intertwined with her individual claims. However, the Ninth Circuit found that the district court abused its discretion by failing to provide a clear explanation for the fee award. The court vacated the fee award and remanded the case for further proceedings, instructing the district court to provide a concise but clear explanation for any future fee determination. View "Alvarado v. Wal-Mart Associates, Inc." on Justia Law

A married couple, both employees of UT-Battelle, objected to their employer’s COVID-19 vaccine mandate on religious grounds, specifically because of their belief that the vaccines’ development involved the use of fetal cell lines from abortions, which conflicted with their Christian faith. UT-Battelle required employees seeking religious exemptions to undergo a panel interview and read a “fact sheet” presenting religious leaders’ support for vaccination. Employees granted religious accommodations were placed on unpaid leave, while those with medical accommodations were not. Mrs. Bilyeu ultimately received a medical exemption before the policy took effect and did not lose pay or work time. Mr. Bilyeu, however, was placed on unpaid leave after exhausting his vacation days, returning to work only after the policy was rescinded.The United States District Court for the Eastern District of Tennessee granted summary judgment to UT-Battelle on all claims except Mrs. Bilyeu’s retaliation claim, which was later settled. The court found that Mrs. Bilyeu lacked standing and that Mr. Bilyeu had not suffered a materially adverse employment action under Title VII.The United States Court of Appeals for the Sixth Circuit affirmed the district court’s judgment as to Mrs. Bilyeu, holding she lacked Article III standing because she suffered no cognizable injury after receiving her medical accommodation. For Mr. Bilyeu, the Sixth Circuit vacated the summary judgment on his disparate treatment and failure-to-accommodate claims, instructing the district court to reconsider them in light of the Supreme Court’s decision in Muldrow v. City of St. Louis, which eliminated the “materially adverse” requirement for adverse employment actions under Title VII. The court reversed the summary judgment on Mr. Bilyeu’s retaliation claim, finding sufficient evidence for a reasonable jury to conclude that the interview process could dissuade a reasonable worker from seeking a religious accommodation, and remanded for further proceedings. View "Bilyeu v. UT-Battelle, LLC" on Justia Law

The appellant was injured while inspecting an underground fiber optics project when he slipped and fell into a manhole, sustaining injuries to his right shoulder, left knee, and lower back. Initially, he did not report or seek compensation for a cervical spine (neck) injury. Several weeks later, he sought coverage for cervical spine surgery, claiming the work accident aggravated a preexisting condition. The Division denied coverage, concluding there was no causal relationship between the work accident and the cervical spine injury.After the denial, the appellant requested review, and the Wyoming Department of Workforce Services, Workers’ Compensation Division referred the matter to the Office of Administrative Hearings (OAH) for a contested case hearing. The OAH found that the cervical spine injury was not caused by the work accident. The appellant appealed to the District Court of Natrona County, which affirmed the OAH’s decision. The appellant then appealed to the Wyoming Supreme Court.The Supreme Court of Wyoming held that the Division erred by referring the case to the OAH instead of the Medical Commission. The Court found that the primary issue—whether the cervical spine injury was caused by the work accident—required the application of medical judgment to complex medical facts and conflicting medical diagnoses. Under Wyoming law, such “medically contested cases” must be referred to the Medical Commission. The Court reversed the lower courts’ decisions and remanded the case for further proceedings before the Medical Commission, holding that the Division was required to refer the matter to the Medical Commission because it involved a medically contested issue. View "Polzer v. State ex rel. Department of Workforce Services, Workers' Compensation Division" on Justia Law

A prospective employee applied for a position as an occupational therapist with a rehabilitation company, which required COVID-19 vaccination as a condition of employment. The applicant requested a religious exemption, submitting a written statement and a supporting letter from a friend citing religious objections to vaccines developed with fetal cell lines. The company questioned the applicant about her vaccination history and, finding her responses insufficiently sincere, denied the exemption and rescinded the job offer. The applicant filed a complaint with the Kansas Department of Labor, which found the company had violated Kansas law by inquiring into the sincerity of her religious beliefs.The company sought judicial review in the Johnson District Court, which reversed the agency’s decision. The district court held that the relevant Kansas statute, which prohibits employers from inquiring into the sincerity of an employee’s religious beliefs when considering COVID-19 vaccine exemptions, was preempted by federal law—specifically, the federal Vaccine Mandate for Medicare and Medicaid providers and Title VII of the Civil Rights Act. The district court also found the Kansas statute violated due process because it lacked a rational basis.On appeal, the Supreme Court of the State of Kansas reviewed the case de novo. The court held that the federal Vaccine Mandate and Title VII do not expressly or impliedly preempt the Kansas statute, because federal law permits but does not require employers to inquire into religious sincerity. The court further held that the Kansas law does not violate due process, as it is rationally related to the legitimate state interest of protecting religious liberty and provides adequate procedural protections. The Supreme Court of Kansas reversed the district court’s judgment and remanded the case for further proceedings. View "Powerback Rehabilitation v. Dept. of Labor" on Justia Law

Two African American truck drivers employed by a large transportation company in Nashville alleged that their supervisors subjected them to a racially hostile work environment. The plaintiffs claimed they were assigned longer routes and more hours than their non-African American colleagues for the same pay, denied certain benefits, and given older or more damaged trucks. They also testified that their supervisors, one of whom was also African American, repeatedly called them “monkey” and “monkey ass,” used demeaning language, and threatened or criticized them in ways not directed at white coworkers. The plaintiffs reported this conduct to company liaisons and managers, but the alleged harassment continued. One plaintiff resigned due to the conditions, while the other was terminated for alleged performance issues, which he disputed.The United States District Court for the Middle District of Tennessee granted summary judgment to the employer, finding that the plaintiffs had not provided sufficient evidence of race-based harassment to support a hostile work environment claim. The court reasoned that the terms used by the supervisors were not inherently racist, that the plaintiffs had not shown the terms were used only against African Americans, and that the plaintiffs’ comparative evidence was insufficient because it did not establish the race of the relevant comparators with the required specificity.On appeal, the United States Court of Appeals for the Sixth Circuit reviewed the grant of summary judgment de novo. The appellate court held that the plaintiffs’ testimony regarding the use of “monkey” and “monkey ass” by supervisors constituted evidence of race-based harassment, given the well-established history of those terms as racial slurs against African Americans. The court also found that the plaintiffs’ comparative and other evidence was admissible and sufficient to raise genuine issues of material fact regarding the severity and pervasiveness of the harassment and the employer’s liability. The Sixth Circuit reversed the district court’s judgment and remanded the case for further proceedings. View "Smith v. P.A.M. Transport, Inc." on Justia Law