FTC Proposes Rule to Ban Non-compete Clauses

For decades, employers have used non-competition agreements to not only artificially lower the salaries of their employees but also to render those employees into something akin to indentured servitude.

Captured ideas On January 5, 2023, the Federal Trade Commission proposed a new rule – accessible at https://www.ftc.gov/legal-library/browse/federal-register-notices/non-compete-clause-rulemaking — that would ban employers from imposing non-competes on their workers, a widespread and often exploitative practice that suppresses wages, hampers innovation, and blocks entrepreneurs from starting new businesses. The proposed rule provides that: “It is an unfair method of competition for an employer to enter into or attempt to enter into a non-compete clause with a worker; maintain with a worker a non-compete clause; or represent to a worker that the worker is subject to a non-compete clause where the employer has no good faith basis to believe that the worker is subject to an enforceable non-compete clause.” The proposed rule would also require the rescission of all non-competition agreements entered into before the date the new rule takes effect.

By stopping these unfair non-competition agreements, the FTC estimates not only that wages might be increased by nearly $300 billion per year but also that expanded career opportunities would abound for about 30 million Americans.

President Biden Signed Into Law the “Speak Out Act,” Curbing Use Of Non-Disclosure Agreements In Harassment Cases

Helping Employees Recover and Enforcing Employment Laws Helmer Friedman LLP.

President Biden signing the Speak Out Act.

On December 7, 2022, President Joe Biden signed the Speak Out Act, which bans the use of pre-dispute non-disclosure and non-disparagement contract clauses involving sexual assault and sexual harassment. The new law renders unenforceable non-disclosure and non-disparagement clauses related to allegations of sexual assault and/or sexual harassment that are entered into “before the dispute arises.” The new law does not prohibit the use of these agreements completely. The Speak Out Act exclusively prohibits and nullifies pre-dispute non-disclosure and non-disparagement agreements and does not apply to post-dispute agreements. Accordingly, the act only applies to instances before a sexual harassment, or sexual assault dispute arises. The act also does not apply to trade secrets, proprietary information, or other types of employee complaints such as wage theft, age discrimination, or race discrimination.

23 Years a Slave: Restaurant Owner Gets Sentence for Enslaving Intellectually Disabled Black Man

A South Carolina restauranteur was sentenced to prison after admitting he used violence, threats, and intimidation to force a black man to work more than 100 hours a week with no pay in a stunning case of throwback slavery.

On Monday, U.S. District Court Judge R. Bryan Harwell sentenced 54-year-old Bobby Paul Edwards to 10 years in federal prison after he pleaded guilty to one count of forced labor, according to a press release from the Department of Justice. Prosecutors say that Edwards, who managed his family’s restaurant, forced Chris Smith, an intellectually disabled black man, to work for free and live in a small room behind the restaurant. Court documents show that Edwards physically abused Smith for at least 17 years, including whipping Smith with a belt, beating him with pots and pans, and even burning him with hot grease.

23 Years a Slave In 1996, when Smith was only 12 years old, he accepted a job at J&J Cafeteria in Conway, S.C., WPDE reports. Six years later, Edwards took over as manager and stopped paying Smith. Over the next 17 years, Edwards would torture, imprison and withhold pay from Smith, claiming that his pay was kept in an “account” that was inaccessible to Smith.

A federal lawsuit filed on Smith’s behalf claims that Smith worked 18 hours a day, six days a week. On Sundays, he only had to work 11 hours. During his entire 23 years of enslavement at J&J, Smith claims he never had a work break or a day off. Forced to live in a “cockroach-infested” apartment behind the business, Smith alleges that Edwards’ family never tried to intervene.

“They knew,” said Smith. “All of ‘em knew. They knew what he was doing.”

For stealing his victim’s freedom and wages, Mr. Edwards has earned every day of his sentence.

When Smith’s family would try to check on him, Edwards would lock Smith in the kitchen or even in the freezer. On the rare occasion that Smith indicated displeasure or tried to escape, he was hit in the head with a frying pan, burned with hot tongs, beaten with belt buckles, and called the n-word repeatedly. Customers reported that they sometimes heard Smith being beaten and screaming for his life.

“I wanted to get out of there a long time ago. But I didn’t have nobody I could go to,” Smith explained. “I couldn’t go anywhere. I couldn’t see none of my family so that was that…That’s the main basic thing I wanted to see was my mom [to] come see me.”

Geneane Caines, who was friends with the Edwards family, was a frequent customer at J&J, and her daughter, who worked at the eatery, told her how Edwards abused Smith. Once, while eating at the restaurant, she noticed signs of abuse.

He leaned one way over and when he did, I could see [a scar] on his neck.

“Chris came out of the kitchen and put some food down on the bar,” Caines told . “He leaned one way over and when he did, I could see [a scar] on his neck.”

After looking into the situation, Caines reported Edwards to the Department of Social Services, who rescued Smith. Caines also alerted Abdullah Mustafa, President of the Conway chapter of the NAACP. They helped Smith get on his feet and Caines allowed Smith to stay in her home for two months.

Edwards was sentenced to 10 years after pleading guilty to one count of forced labor. He was also ordered to pay $272,952.96 in restitution. (Or as Merriam-Webster correctly defines it: “Reparations.”)

“For stealing his victim’s freedom and wages, Mr. Edwards has earned every day of his sentence,” said U.S. Attorney Sherri A. Lydon for the District of South Carolina. “The U.S. Attorney’s Office will not tolerate forced or exploitative labor in South Carolina, and we are grateful to the watchful citizen and our partners in law enforcement who put a stop to this particularly cruel violence.”

The next day, Lydon, an ever-vigilant protector of the people, prosecuted 28-year-old Erron Jordan. Jordan was stopped by a Conway police officer because his window tint was too dark. After cops noticed the “odor of marijuana,” police found a small amount of illegal drugs, prescription pills, and a firearm in the car.

Jordan was sentenced to 12 years in prison and three years of supervised probation.

Jordan has never been convicted of a violent offense.

Oh, “Justice” Department, you almost had me.

If you or your loved ones would like to dine at J&J Cafeteria, it is open 14 hours a day, seven days a week.

It is still owned by the Edwards family.

Read more by Michael Harriot at The Root

Civil Rights Queen: Constance Baker Motley and the Struggle for Equality

February 28, 2022 – As the Senate prepares to hold hearings on the historic nomination of Ketanji Brown Jackson, the first Black woman nominated to sit on the Supreme Court, it’s the perfect time to highlight a new biography about another Black woman who accomplished a series of firsts and who, in another, more modern, era, would almost certainly have been nominated to serve on the Supreme Court – Constance Baker Motley.  

Constance Baker Motley first Black woman to argue before SCOTUS. Constance Baker Motley was not only the first Black woman to argue before the Supreme Court (winning an astonishing nine of 10 cases), but she was also the first black woman to be appointed to the federal judiciary – President Lyndon B. Johnson appointed her to the Southern District of New York.

Motley began college at Fisk University, a historically black college in Nashville, Tennessee, but subsequently transferred to New York University, where she graduated with a Bachelor of Arts degree. She received her Bachelor of Laws from Columbia Law School. Motley then went to work for the NAACP Legal Defense and Educational Fund, Inc. as a civil rights lawyer, where she wrote the original complaint in the case of Brown v. Board of Education. Her first argument before the Supreme Court was in Meredith v. Fair; she won James Meredith’s effort to be the first black student to attend the University of Mississippi.

Civil Rights Queen Constance Baker MotleyIn her terrific new book on Motley’s life and legacy – called Civil Rights Queen: Constance Baker Motley and the Struggle for Equality“- Harvard law professor Tomiko Brown-Nagin Poignantly describes Motley’s life from the time that she was born to a working-class family during the Great Depression, to her role as one of the principal strategists of the Civil Rights Movement and for her legal defense of Martin Luther King Jr., the Freedom Riders, and the Birmingham Children Marchers when she was a civil rights lawyer for the NAACP, to her service in the New York State Senate and as Manhattan Borough President, to her becoming the first Black woman serving in the federal judiciary.

Justice Stephen Breyer Resigns – President Joe Biden Nominates Ketanji Brown Jackson To Be First Black Woman To Sit On Supreme Court

Helmer Friedman LLP discusses nomination of Judge Ketanji Brown Jackson to U.S. Supreme Court.

February 25, 2022 – On January 26, 2022, Justice Stephen Gerald Breyer notified the White House that he would retire at the end of the 2021-2022 term. One month later, on February 25, 2022, President Joseph Robinette Biden Jr. nominated Ketanji Brown Jackson to the Supreme Court, beginning a historic confirmation process for the first Black woman to sit on the highest court in the nation in its 223-year history.

Judge Jackson, who clerked for Justice Breyer, has worked as a public defender, a corporate attorney, a U.S. District Court judge, is currently sitting on the U.S. Court of Appeals for the District of Columbia. “If I’m fortunate enough to be confirmed as the next associate justice of the Supreme Court of the United States,” Judge Jackson commented in her prepared remarks about her nomination, “I can only hope that my life and career, my love of this country and the Constitution and my commitment to upholding the rule of law and the sacred principles upon which this great nation was founded, will inspire future generations of Americans.” 

Helmer Friedman LLP discusses President Bidens nomination of Judge Brown Jacksons to SCOTUS.

If confirmed, Justice Jackson won’t alter the Supreme Court’s ideological far-right conservative tilt because the overall makeup of the court will continue to include six conservatives and three liberals. Unfortunately, despite winning the popular vote in 7 of the last 8 elections, the Republicans have rigged the system to achieve a radical conservative majority. Indeed, when Justice Antonin Gregory Scalia died in February of an election year (2016), President Barack Hussein Obama’s nomination of Merrick Garland would have, if confirmed by the Senate, flipped the then five-to-four conservative court to a five-to-four liberal one. But Senator Mitch McConnel and his Republican caucus refused to hold a hearing on Garland’s nomination on the theory that court vacancies that arise during presidential election years should remain unfilled until the next president takes office. Then, when Justice Ruth Bader Ginsburg died in an election year (September 2020, less than two months before the presidential election), Senator Mitch McConnel and his Republican cronies hypocritically changed the rules and confirmed President Donald John Trump’s nomination of Amy Coney Barrett with lightning speed. “And just like that,” as Carrie Bradshaw would say, what should have been a 6 – 3 liberal court majority became the most radical right-wing conservative court since the Lochner era of 1897 to 1937.

‘We Feel Like We’ve Been Scammed’: OnlyFan Models Allege Managers Exploited Them During Covid-19 Boom

Like many people during the early months of the pandemic, Ari, 21, lost her job in the summer of 2020. She’d been working at a casino in the U.K., but government shutdowns forced her employer to lay her off. “I had to get money somehow,” she says.

Ari, whose full name has been withheld to protect her privacy, had an account on OnlyFans, a direct-to-consumer content platform popularized by online sex workers that exploded in popularity during the pandemic. But she’d never really worked to promote her account, until after she was laid off. She’d started to grow a minor following, raking in about $3,000 per month. Then another creator on OnlyFans, a woman we’ll call Cora, messaged her. She’d just gotten a new manager, Nathan Johnson, who’d promised her she could one day earn nearly $100,000 per month; he’d just lost a model, and he needed a new one to take over her Instagram account.

Ari was intrigued. She was somewhat familiar with Johnson, a 21-year-old social media advertising wunderkind of sorts who on his website touts press coverage from the New York Times (in which he was quoted in a piece on spammy Instagram cash giveaway accounts), Business Insider, and Yahoo Finance. Johnson owned a model management company, NJAC LLC, and he was recruiting Ari via his Instagram account Enhancement, which has more than half a million followers on Instagram; in its bio, Enhancement promises to help earn creators $100,00 per month. Ari says Johnson also claimed to be partnered with Baddie, a popular Instagram page promoting OnlyFans creators. (When reached by Rolling Stone, Johnson declined to comment whether NJAC has any relationship with Baddie, though he said the two management companies shared employees at the time.)

Ari thought there were a few red flags — Johnson’s company didn’t have its own website, and she didn’t speak with him on the phone. But Cora, who’d been with Johnson for a month, seemed to be making a lot of money, and Ari was lured by Johnson’s promises of helping her grow her Instagram and OnlyFans following. “[Cora] said you really want to be famous,” Johnson wrote in WhatsApp messages provided to Rolling Stone. “And that’s perfect cause that’s what we make people.”

“Yessss I wanna be rich,” Ari responded.

“Well perfect cause I want to be rich too lol,” Johnson responded.

Ari signed with Johnson, and for a few months, she says, he appeared to deliver on his word, with Ari making $75,000 in the first month. Then she realized he wasn’t actually giving her insight on how to grow her page or what type of content to post; according to Ari, he was just advertising her content on Instagram meme pages. (In a conversation with Rolling Stone, Johnson disputed this: “of course we advised on strategy,” he says.) Plus, her earnings were dropping; one month, she says, she only made $10-$15,000 out of $50,000 of earnings. When she confronted Johnson about this, he said he was spending much of that money on ads, but when Ari asked for proof of how much he was spending, he refused to show her any invoices or documentation, citing company secrets. And according to texts provided to Rolling Stone, he also publicly posted sexually explicit content that she had intended to only sell privately, though he apologized promptly after doing so. Ari says Johnson also pressured her to produce more content, though Johnson denies this, providing text messages to Rolling Stone that he did give her time off when she requested it.

After Ari says she heard from another model that Johnson was not, in fact, partnered with Baddie, she’d had enough. “I realized he was taking too much from me and i felt it wasn’t worth it to continue carrying on,” she says. In February, she sent Johnson a WhatsApp message saying she wanted to terminate their contract. He responded by threatening to take legal action against her if she continued to post content on social media, referring to a sunset clause in the contract she’d signed. “All no competes and clauses of early termination will be applied, and appropriate action will be taken if they are not! Thanks for your time with NJAC,” he wrote in response, adding that Ari would also have to forfeit the previous 30 days’ worth of income.

Johnson tells Rolling Stone he only made such threats under pressure of a lawyer, and had no intention to enforce them. “I’m a reasonable person. I was like, ‘This is what the contract says,’ not, ‘this is what I want to do,’” he says. “She was being very emotional and not very respectful during that conversation.” He also says NJAC’s contracts no longer include sunset clauses or non-competes, though he declined to provide Rolling Stone with a copy of the updated contract. 

After Ari left Johnson, she says, he continued to post as her under her Instagram and OnlyFans accounts and reselling explicit content she had already sold to her followers at a vastly reduced rate, leading to subscribers complaining about her scamming them. It was at this point that she hired attorney Anibal Luque to send a cease-and-desist to Johnson. When Johnson kept posting, Luque sent another one. (Johnson says he had agreed with Ari beforehand that he could post on the account for 30 days afterward, and stopped immediately after receiving the initial letter from her lawyer. He says he did not receive a follow-up letter because he was out of town at the time.)

In the months since she left Johnson, Ari says she’s heard from nearly half a dozen models who had similar experiences with him, including Cora, who also left after she alleges Johnson took 60-70 percent of her income. “Nathan was a very nice guy, until you didn’t comply with his agenda,” Cora says.

Read more from EJ Dickson at Rolling Stone

The Best and Worst Employment Developments of 2017

Employment Development 2017 Advocate Magazine


During his first year or so in office, President Trump and his administration launched an all-out war on the American worker in every area touching upon the employment relationship. From wage and hour, to anti-discrimination, to workplace health and safety, to the unionized work place – the Trump government has begun to completely gut the rights and protections of the American worker.

In addition, President Trump has nominated to the Supreme Court, the Circuit Courts of Appeal, and the District Courts individuals who are extremely hostile to employee rights.

Sadly, the Democrats and Independents in Congress have been unable to stop the Trump administration. And Republicans, who should know better, have been cowed into a state of sycophantic submission. Fortunately, at least for those workers living in California, Governor Jerry Brown, Attorney General Xavier Beccera, and the Democrats in the California State Legislature have moved to beef-up protections for California workers.

This article attempts to “cherry-pick” and briefly summarize not just the most significant employment developments and cases of 2017 (and early 2018) but also those that are of the most utility to plaintiff employment practitioners.

The Trump administration’s anti-worker efforts

In a little over a year, the Trump administration has moved to eviscerate so many employee rights and protections that it is impossible to detail all of them.

Accordingly, what follows are just a few examples of the efforts by President Trump and his administration to curtail employee rights and protections.

While the Obama administration attempted to bolster employee wages by increasing the salary threshold for the White Collar Exemption from $455/workweek (or $23,660 for a full year worker) to $913/workweek (or $47,476 for a full year worker) so that more employees would be eligible for overtime, the Trump administration made clear its opposition to this Obama initiative. Likewise, while the Obama administration sought to benefit lower wage restaurant employees by establishing a “tip pooling” rule which limited the scenarios in which restaurant employers could force tipped workers to share their gratuities with others (including not just the traditionally non-tipped “back of the house” employees, but also managers and owners), the Trump administration has announced plans to undo the Obama-era “tip pooling” rule and allow restaurant owners and managers to steal the tips left for these workers.

Similarly, while the Obama administration took the position that Title VII protected LGBTQ employees from discrimination, harassment and retaliation, the Trump Justice Department has reversed course and taken the position that those employees are not entitled to Title VII protection and President Trump has taken the position that trans individuals should be kicked out of and not allowed to join the military.

The Trump EPA has argued in favor of repealing an Obama-era OSHA rule designed to protect workers from exposure to harmful silica dust (which is linked to lung cancer, kidney disease, and chronic obstructive pulmonary disease). Indeed, while the Obama administration issued a rule that reduced permissible exposure to beryllium from 2.0 micrograms per cubic meter of air to 0.2 micrograms per cubic meter of air over an eight-hour period, the Trump administration has proposed keeping beryllium exposure limits at the previous level for workers in the shipyard and construction industries. The Trump administration has also halted an Obama-era rule requiring employers to submit workplace injury and illness data for posting online.

The Trump administration has also taken affirmative steps to dramatically curtail the rights of unions and unionized workers. Indeed, on December 1, 2017, Peter B. Robb, the NLRB’s new Trump appointed General Counsel, issued an internal memorandum declaring that he would be rescinding seven “guidance memos” that were crafted by his Democratic predecessors and that he was freezing worker friendly reforms made under the Obama administration; that generally showed that he plans to take a much narrower view of worker rights than his predecessors. Similarly, while President Obama’s Solicitor General sided with the unions in Friedrichs v. California Teachers Association (2016) 136 S.Ct. 1083, and argued that public employee fair share fees were legal, President Trump’s Solicitor General sided against the unions on that precise issue in Janus v. American Federation of State, County, and Municipal Employees and argued that fair share fees are unconstitutional because they violated free speech rights.

Compare Obama Justice Department Brief of the United States as Amicus Curiae Supporting Respondents, p.11 (“Abood was correctly decided and should be reaffirmed.”), accessible at http://www.scotusblog.com/wpcontent/uploads/2015/11/14915_amicus_resp_US.authcheckdam.pdf with Trump Justice Department Brief of the United States as Amicus Curiae Supporting Petitioner, p.11 (“The court should overrule Abood and hold that the first amendment prohibits compulsory agency fees in public employment.”) accessible at https://www.supremecourt.gov/DocketPDF/16/161466/22919/20171206205129333_161466tsacUnitedStates.pdf.

U.S. Supreme Court

During 2017, the U.S. Supreme Court did not issue any major decisions impacting labor and employment law practitioners. It did, however, issue three decisions covering certain niche labor and employment law issues – Perry v. Merit Systems. Protection. Bd. (2017) 137 S.Ct. 1975 (holding that the proper review forum when the Merit Systems Protection Board dismisses a mixed case on jurisdictional grounds is district court, not the Federal Circuit); McLane Co. v. EEOC (2017) 137 S.Ct. 1159 (clarifying that the scope of review for employers facing EEOC administrative subpoenas is “abuse-of-discretion” rather than de novo review); and NLRB v. SW Gen., Inc. (2017) 137 S.Ct. 929 (holding that the Federal Vacancies Reform Act of 1998, which prevents a person who has been nominated to fill a vacant office requiring presidential appointment and Senate confirmation from performing the duties of that office in an acting capacity, applied to Lafe Solomon, who President Barack Obama directed to perform the duties of general counsel for the NLRB, once the President nominated him to fill that post; and as a result, an NLRB order charging an employer with an unfair labor practice was properly vacated).

In early 2018, the Supreme Court decided two important employment cases. In the first case, Artis v. D.C. (2018) 138 S.Ct. 594, the Supreme Court addressed an interesting procedural question involving tolling and, in the process, showed just how remarkably heartless some judges including, in particular, the conservatives on the Supreme Court can be. Stephanie Artis filed a lawsuit in federal district court alleging that her employer, the District of Columbia, violated Title VII and several District of Columbia laws. At the time she filed her lawsuit, she had two years remaining of the statutes of limitation applicable to her state law claims.

Her lawsuit languished in the District Court for two years before the Court granted the District of Columbia’s motion for summary judgment on her Title VII claims and declined to exercise supplemental jurisdiction over her state law claims.

In declining to exercise jurisdiction over her state law claims, the District Court expressly opined that Artis would not be prejudiced by the dismissal because, under the Federal Supplemental Jurisdiction Statute, 28 U.S.C. section 1367(d), her state law claims were tolled during the time period in which they were pending in federal court plus an additional 30 days. Fifty-nine days after the dismissal of her state law claims, Artis refiled those claims in the District of Columbia Superior Court. The Superior Court dismissed her state law claims holding that she filed them 29 days too late. The Superior Court bizarrely rejected Artis’s “stop the clock” interpretation of the word “tolled” in the Supplemental Jurisdiction Statute and concluded that she only had 30 days following the dismissal of her claims in federal court to refile.

On appeal, the District of Columbia Court of Appeals affirmed. On further appeal, the U.S. Supreme Court, in an opinion by Justice Ginsburg joined by Justices Breyer, Sotomayor, Kagan and Roberts, reversed, holding that “tolled” means what it says – to stop the clock. Notoriously hostile to employee rights, Justice Gorsuch filed a dissenting opinion in which Justices Kennedy, Thomas, and Alito joined, explaining that the word “tolled” can have two different meanings – to stop the clock or to not stop the clock – depending on context. And, in this case, where the Supplemental Jurisdiction Statute says that the statutes of limitation on claims are tolled during the time that the case is pending in federal court, it means that the running of the statutes of limitation is actually not tolled or stopped.

In the second case, Digital Realty Trust, Inc. v. Somers (2018) 138 S.Ct. 767, the Supreme Court oddly held that the anti-retaliation provision of the Dodd-Frank Wall Street Reform and Consumer Protection Act only protects individuals who have reported a violation of the securities laws to the SEC. Strangely, in so holding, the Supreme Court rejected the interpretations of the Second and Ninth Circuit, which had cogently explained why an internal complaint was sufficient to invoke the protections of Dodd-Frank.

The Ninth Circuit

During 2017, the Ninth Circuit issued five important decisions in the areas of retaliation (Arias v. Raimondo (9th Cir. 2017) 860 F.3d 1185), sexual harassment (Zetwick v. County of Yolo (9th Cir. 2017) 850 F.3d 436), gender discrimination (Mayes v. WinCo Holdings, Inc. (9th Cir. 2017) 846 F.3d 1274), the Fair Credit Reporting Act (Syed v. MI, LLC (9th Cir. 2017) 846 F.3d 1034), and taxes (Clemens v. Centurylink Inc. (9th Cir. 2017) 874 F.3d 1113).

In Arias, the Ninth Circuit held that an employer’s outside counsel may be personally liable for violating the anti-retaliation provisions of the Fair Labor Standards Act of 1938 (“FLSA”), 29 U.S.C. section 215(a)(3). The plaintiff, Jose Arias, who had sued his former employer, Angelo Dairy, in California State Court on behalf of himself and other employees under California’s Private Attorneys General Act of 2004, Cal. Labor Code section 2698 et seq., alleged that the Dairy’s outside counsel, Anthony Raimondo, set in motion an underhanded plan to derail Arias’s lawsuit by enlisting the services of U.S. Immigration and Customs Enforcement (“ICE”) to take him into custody at a scheduled deposition and then to remove him from the United States. Raimondo moved for summary judgment arguing that because he was never Arias’s actual employer, he could not be held liable under the FLSA for retaliation against someone who was never his employee. While the district court granted Raimondo’s motion, the Ninth Circuit reversed, holding that an employer’s attorney can be held liable for retaliating against his client’s employee because the employee sued his client for violations of workplace laws.

Preceding the dramatic rise of the #MeToo movement, Zetwick serves as a powerful reminder that some courts will no longer excuse sexually inappropriate conduct as being merely innocuous differences in the ways men and women routinely interact with members of the same sex and of the opposite sex. Victoria Zetwick alleged that her employer created a sexually hostile work environment in violation of Title VII by, among other things, greeting her with unwelcome hugs on more than one hundred occasions, and a kiss at least once, during a 12-year period. Opining that “hugging and kissing on the cheek in the workplace is not only insufficient to sustain a claim of hostile work environment, but overextends the intended scope of Title VII,” the District Court granted the employer’s motion for summary judgment. (Zetwick v. Cty. of Yolo, (E.D. Cal. 2014) 66 F.Supp.3d 1274, 1280.)

On appeal, the Ninth Circuit reversed, holding, “we cannot accept the conclusion that Zetwick did not state an actionable claim of a sexually hostile work environment . . . A reasonable juror could find, for example, from the frequency of the hugs, that [her supervisor’s] conduct was out of proportion to ‘ordinary workplace socializing’ and had, instead, become abusive.” (850 F.3d at 443444.) Importantly, the Ninth Circuit also highlighted several mistakes that the district court made (that are also commonly made by other courts): (1) the district court applied an incorrect standard for assessing hostile work environment claims – the standard is “severe or pervasive,” not “severe and pervasive”; (2) the district court completely overlooked legal recognition of the potentially greater impact of harassment from a supervisor versus a coworker; (3) the court improperly disregarded “me too” evidence showing that the alleged harasser also sexually harassed others – the sexual harassment of others, if shown to have occurred, is relevant and probative of a defendant’s general attitude of disrespect toward his female employees and his sexual objectification of them; (4) it was improper for the court to determine that Zetwick’s testimony that another woman was offended by the alleged harasser’s hugs, based on Zetwick’s firsthand observation, was somehow less credible than that other woman’s assertion in a post hoc declaration that she was not offended as a reasonable jury could conclude that the woman had reasons not to complain about the past treatment by her employer and to make a declaration, not subject to cross-examination, to support her employer’s position.

As in Zetwick, the Ninth Circuit reversed summary judgement granted to an employer in Mayes and highlighted multiple mistakes made by the district court (mistakes that are also commonly made by other courts). Katie Mayes sued her former employer, a grocery store, for gender discrimination after she was fired for taking a stale cake from the store’s bakery to the break room to share with fellow employees. The district court granted the store’s motion for summary judgment, finding that Mayes was unable to prove pretext. On appeal, the Ninth Circuit initially explained that an employee can prove pretext either: (1) directly, by showing that unlawful discrimination more likely motivated the employer; or (2) indirectly, by showing that the employer’s proffered explanation is unworthy of credence because it is internally inconsistent or otherwise not believable.

Then, the Ninth Circuit found that summary judgment was inappropriate because Mayes was able to establish pretext both directly and indirectly. With respect to the direct route of proving pretext, the Ninth Circuit found that unlawful discrimination more likely motivated the employer because Mayes put forward evidence that one of the individuals who participated in the decision-making process (but did not participate in the ultimate termination decision): (1) commented that a man “would be better” at leading one of the company’s committees; (2) commented that she did not like “a girl” running the company’s freight crew; and (3) criticized Mayes, but not her male counterpart, for leaving work early to care for her children. In this regard, the Ninth Circuit held that racist or sexist statements constitute direct evidence of discrimination and rejected the district court’s determination that these were so-called “stray remarks.”

The Ninth Circuit also rejected the district court’s view that direct evidence had to be “specific and substantial.” With respect to the direct route of proving pretext, the Ninth Circuit found that the employer’s proffered explanation for the termination was unworthy of credence because: (1) multiple employees testified that it was a common, accepted practice – rather than an offense punished by termination – for supervisors such as Mayes to take cakes to the break room; (2) the grocery replaced her with a less qualified male employee; the Ninth Circuit explained that evidence that an employer replaced a plaintiff with a less qualified person outside the protected class can be evidence of pretext.

Syed v. MI, LLC is a case of first impression in the federal appellate courts: whether a prospective employer may satisfy the Fair Credit Reporting Act’s (“FCRA”) disclosure requirements by providing a job applicant with a disclosure that a consumer report may be obtained for employment purposes which simultaneously serves as a liability waiver for the prospective employer and others. The Ninth Circuit held that a prospective employer violates the FCRA when it procures a job applicant’s consumer report after including a liability waiver in the same document as the statutorily mandated disclosure. The Ninth Circuit also held that in light of the clear statutory language that the disclosure document must consist “solely” of the disclosure, a prospective employer’s violation of the FCRA is “willful” when the employer includes terms in addition to the disclosure, such as a liability waiver, before procuring a consumer report or causing one to be procured.

Finally, in Clemens, the Ninth Circuit followed the Third, Seventh, and Tenth Circuits and held that Title VII authorizes district courts, in their sound discretion, to permit equitable gross-up adjustments to compensate successful plaintiffs for increased income-tax liability resulting from the receipt of a back-pay award in one lump sum.

One Ninth Circuit case, Perez v. City of Roseville (9th Cir. 2018) 2018 WL 797453, from thus far in 2018 merits discussion. Janelle Perez was a probationary police officer employed by the Roseville Police Department. Although she was married, she had an offduty affair with a fellow police officer – Shad Begley.

Begley’s wife learned about the affair and was not very happy about it. So, she reported Begley and Perez to the police department. The police department investigated the complaint, corroborated the affair between Perez and Begley, and issued to them a written reprimand. Perez appealed the Reprimand. At the hearing, the Department informed Perez that she had been fired. When Perez asked why, the Department refused to give a reason. Two weeks later, the Department issued a revised written Reprimand to Perez reversing the statements about Unsatisfactory Work Performance and Conduct and, instead, basing it on Perez’s inappropriate Use of Personal Communication Devices. Perez did not appeal this version of the Reprimand because she had already been fired. Instead, Perez sued the Department pursuant to 42 U.S.C. Section 1983, alleging that the Department’s decision to fire her violated her constitutional rights to privacy and intimate association. The Department filed a motion for summary judgment arguing that (1) the decision to fire Perez had nothing to do with her extramarital affair; and (2) even if her affair played a role in the decision, it didn’t do anything wrong as Perez had no constitutional right to not be fired for having an affair.

The district court agreed with the Department and granted its motion. On appeal, the Ninth Circuit reversed. Initially, the Ninth Circuit held that public employees such as police officers have a right to privacy in their private, off-duty sexual behavior. Then, the Ninth Circuit concluded that there was a genuine factual dispute about whether the Department fired her “in part” because of her affair. In so ruling, the Ninth Circuit focused on several critical pieces of evidence including: (1) a non-decision-maker – who played a role in contributing information in the decision-making process – morally disapproved of the affair and thought that Perez should be fired because of it; (2) the speed with which the Department “discovered” unrelated problems with Perez’s performance – within 8 weeks after it learned about the affair; and (3) the shifting explanations offered by the Department for firing Perez. When it first notified Perez that she had been fired, the Department refused to provide a reason. Next, well after her firing, the Department issued a new Reprimand to Perez reversing the findings of “Conduct Unbecoming” and “Unsatisfactory Work Performance” and substituting a new violation (“Use of Personal Communication Devices”). Then, when the litigation began, the Department put forth the three brand new reasons – failure to get along with women officers, citizen’s complaint, and bad attitude with supervisor – all of which differ from both the original and the belated reprimands issued by the Department after she was fired.

Two non-Ninth Circuit cases merit a brief discussion as they: (1) put the Ninth Circuit to shame and cast doubt on its reputation as the Nation’s leading progressive court; and (2) shed light on an absolutely fascinating internecine war between the Trump/Jeff Sessions Justice Department and, what for all intents and purposes is still, the Obama EEOC, having two Democratic Obama appointees, one Republican Obama appointee, and no General Counsel. In Zarda v. Altitude Express, Inc. (2nd Cir. 2018) 883 F.3d 100, the Second Circuit, in a 103 en banc decision, joined the Seventh Circuit and the EEOC in holding that Title VII prohibits discrimination on the basis of sexual orientation. In so holding, the Second Circuit rejected the arguments of the Trump/Jeff Sessions Justice Department which had filed an amicus brief stating that it, and not the EEOC, was speaking on behalf of the United States and that “discrimination because of sexual orientation is not discrimination because of sex under Title VII.” In EEOC v. R.G. & G.R. Harris Funeral Homes, Inc. (6th Cir. 2018) 2018 WL 1177669, the Sixth Circuit found persuasive the arguments of the EEOC and held that Title VII prohibits discrimination on the basis of an employee’s status as a transgender employee. Importantly, the Sixth Circuit also rejected an attempt by the Funeral Homes employer to argue that the federal Religious Freedom Restoration Act serves as an affirmative defense to a Title VII claim being prosecuted by the EEOC.

California Supreme Court

Anti-SLAPP jurisprudence

The most important employment law case issued by the California Supreme Court in 2017 involved California’s anti-SLAPP statute, Code of Civil Procedure section 425.161. California enacted the antiSLAPP statute in 1992 “out of concern over ‘a disturbing increase’” in civil suits “aimed at preventing citizens from exercising their political rights or punishing those who have done so.” (Simpson StrongTie Co., Inc. v. Gore (2010) 49 Cal.4th 12, 21.) The courts have recognized that “[t]he quintessential SLAPP is filed by an economic powerhouse to dissuade its opponent from exercising its constitutional right to free speech or to petition.” (Nam v. Regents of the University of California (2016) 1 Cal.App.5th 1176, 1193.)

Unfortunately, since its passage, “economic powerhouses” have perverted the anti-SLAPP statute and used it to quash the very people whom it was supposed to protect. For example, in Nesson v. Northern Inyo County Local Hospital Dist. (2012) 204 Cal.App.4th 65, DeCambre v. Rady Children’s Hospital San Diego (2015) 235 Cal.App.4th 1, Tuszynska v. Cunningham (2011) 199 Cal.App.4th 257, and Hunter v. CBS Broadcasting Inc. (2013) 221 Cal.App.4th 1510, employers used the anti-SLAPP statute to defeat FEHA discrimination claims.

In Park v. Board of Trustees (2017) 2 Cal.5th 1057, the California Supreme Court took an important first step toward restoring anti-SLAPP jurisprudence so that it is more closely aligned with the legislative intent by:
(1) disapproving of Nesson, DeCambre, and Tuszynska; (2) expressly taking no opinion regarding whether the terrible Hunter decision was correctly decided; and (3) specifically approving of the terrific pro-employee Nam v. Regents of the University of California case, supra, 1 Cal.App.5th 1176. Ultimately, the Supreme Court concluded: “a claim is not subject to a motion to strike simply because it contests an action or decision that was arrived at following speech or petitioning activity, or that was thereafter communicated by means of speech or petitioning activity. Rather, a claim may be struck only if the speech or petitioning activity itself is the wrong complained of, and not just evidence of liability or a step leading to some different act for which liability is asserted.” (2 Cal.5th at 1060.)

In Williams v. Superior Court (2017) 3 Cal.5th 531, the Supreme Court confirmed that broad discovery is available in claims brought under California’s Private Attorneys General Act (“PAGA”) and held that the contact information of those a plaintiff purports to represent is routinely discoverable as an essential prerequisite to effectively seeking group relief, without any requirement that the plaintiff first show good cause.

Mendoza addresses employees’ rest days

In Mendoza v. Nordstrom Inc. (2017) 3 Cal. 5th 531, the California Supreme Court turned in a homework assignment given to it by the Ninth Circuit, 865 F.3d 1261 (9th Cir. 2017), and addressed several questions regarding California Labor Code sections 551, 552 and 556 by stating the following:

  1. A day of rest is guaranteed for each workweek. Periods of more than six consecutive days of work that stretch across more than one workweek are not per se prohibited.
  2. The exemption for employees working shifts of six hours or less applies only to those who never exceed six hours of work on any day of the workweek. If on any one day an employee works more than six hours, a day of rest must be provided during that workweek, subject to whatever other exceptions might apply.
  3. An employer causes its employee to go without a day of rest when it induces the employee to forgo rest to which he or she is entitled. An employer is not, however, forbidden from permitting or allowing an employee, fully apprised of the entitlement to rest, independently to choose not to take a day of rest.

California Courts of Appeal

Ly v. Cty. of Fresno

One of the most surprising and, perhaps, troublesome cases of 2017 is Ly v. Cty. of Fresno (2017) 16 Cal.App.5th 134. In Ly, the Court of Appeal held that a decision in a workers’ compensation proceeding could have preclusive effects in an employee’s FEHA case. Three Laotian correctional officers filed suit against their employer, alleging that they were subjected to racial and national origin discrimination, harassment, and retaliation. The three simultaneously pursued workers’ compensation claims. The workers’ compensation judges denied the plaintiffs’ claims after finding their employers’ actions were nondiscriminatory, good faith personnel decisions. Subsequently, in the FEHA action, their employer moved for summary judgment based on the doctrines of res judicata and collateral estoppel, arguing the workers’ compensation decisions barred the plaintiffs’ FEHA claims. The trial court granted summary judgment, and the Court of Appeal affirmed. Unless this decision is depublished or overruled, there is a high degree of risk that the workers’ compensation system will be hijacked or militarized by plaintiff and defense employment attorneys to serve as a proxy for any employment claims that employees may bring in civil court. Such a development will be unfortunate not only for the workers’ compensation system but also employees and employers.

Bareno v. San Diego Cmty. Coll. Dist.

Bareno v. San Diego Cmty. Coll. Dist. (2017) 7 Cal.App.5th 546, is a terrific case for plaintiff employment practitioners handling summary judgment and/or claims involving the California Family Rights Act (“CFRA”). Leticia Bareno was employed by the San Diego Community College District. Bareno requested medical leave and provided a medical certification from her physician. After the time period identified in her request for leave expired and Bareno failed to report to work, the District informed her that it had accepted her voluntary resignation. Bareno immediately informed the District that she had not resigned and that she had emailed her supervisor an additional medical certification indicating her need for additional medical leave. The College, claiming that the supervisor never received the additional medical certification, refused to reconsider its position. Bareno sued, alleging that the District had retaliated against her for taking medical leave, in violation of CFRA. The College moved for summary judgment, and the trial court granted the motion. On appeal, Bareno argued that the trial court erred in granting summary judgment on her CFRA retaliation claim because there were triable issues of material fact in dispute. The Court of Appeal agreed, initially noting that:

When viewed as a whole, it is clear that CFRA and its implementing regulations envision a scheme in which employees are provided reasonable time within which to request leave for a qualifying purpose, and to provide the supporting certification to demonstrate that the requested leave was, in fact, for a qualifying purpose, particularly when the need for leave is not foreseeable or when circumstances have changed subsequent to an initial request for leave. (7 Cal.App.5th at 565.)

Accordingly, the Court of Appeal held that the question of whether notice is sufficient under CFRA is a question of fact. The court then reversed, finding the following three disputed issues of material fact. First, the court concluded that there was a triable dispute regarding whether Bareno’s supervisor had timely received the email providing notification of Bareno’s need for additional medical leave. Second, it concluded that even if Bareno’s supervisor had not received the email, there was a triable issue as to whether it fulfilled its obligations under CFRA, which obligates employers to make further inquiries of an employee if it requires additional information from that employee regarding the employee’s request for leave. Third, the court concluded that even if Bareno’s supervisor had not received the email, there was a triable issue as to whether the College decided to interpret Bareno’s absences as a “voluntary resignation,” despite evidence to the contrary, in retaliation for taking medical leave. In reversing summary judgment, the Court of Appeal reiterated that “[M]any employment cases present issues of intent, … motive, and hostile working environment, issues not determinable on paper. Such cases … are rarely appropriate for disposition on summary judgment, however liberalized [summary judgment standards may] be.” (7 Cal.App.5th at 561, quoting Nazir v. United Airlines, Inc. (2009) 178 Cal.App.4th 243, 286.) Husman v. Toyota Motor Credit Corp.

Husman v. Toyota Motor Credit Corp. (2017) 12 Cal.App.5th 1168, should serve as a sharp reminder to employment practitioners that not all employee oppositional conduct will qualify as protected activity. Husman affirmed a summary judgment on Joseph Husman’s FEHA retaliation claim against his former employer, Toyota Motor Credit Corporation, because his criticisms regarding Toyota’s commitment to diversity did not rise to the level of protected activity.

Husman, a gay man, ran Toyota’s diversity and inclusion program. After he was fired, he claimed that Toyota retaliated against him because of his protected activity in complaining that:

(1) Toyota would not include AIDS Walk LA on the list of the company’s automatic payroll deductions; and (2) while Toyota’s LGBT employees had made some progress, there was still work to be done. With respect to his first complaint, the Court of Appeal found that it did not constitute protected activity because the company’s denial of his request did not violate any FEHA prohibition. With respect to his second complaint, the court found that it fell “short of communicating a particularized complaint about discriminatory treatment of LGBT employees and, instead, was likely understood as an exhortation common among diversity advocates to the effect that, while progress has been made, much work remains to be done.” (Id. at 1194.)

Although Husman was a disappointing retaliation case for plaintiff employment practitioners, Husman is, on the other hand, a terrific summary judgment case for plaintiffs as it effectively hammers the final “nail in the coffin” of the socalled hirerfirer or sameactor inference as an argument on summary judgment. Initially, the Court of Appeal noted that while the sameactor inference was “once commonly relied on by courts affirming summary judgment against a plaintiff alleging discriminatory action, the sameactor inference has lost some of its persuasive appeal in recent years.” (Id. at 1188.) The court then went on to explain that “[p]sychological science on moral licensing reveals that, when a person makes both an initial positive employment decision and a subsequent negative employment decision against a member of a protected group, the second negative decision is more likely to have resulted from bias, not less.” (Id. at 1189.)

Andrew H. Friedman is a partner with Helmer Friedman LLP in Culver City. He received his B.A. from Vanderbilt University and his J.D. from Cornell Law School, where he was an Editor of the Cornell Law Review. Mr. Friedman clerked for the Honorable Judge John T. Nixon (U.S. District Court for the Middle District of Tennessee). Mr. Friedman represents individuals and groups of individuals in employment law and consumer rights cases. Mr. Friedman is the author of Litigating Employment Discrimination Cases (James Publishing 20052016). Mr. Friedman served as Counsel of Record in Lightfoot v. Cendant Mortgage Corp. et al. (Case No. 1056068) where he successfully convinced the U.S. Supreme Court to grant the petition for certiorari that he filed on behalf of his clients. In January 2017, the Supreme Court, in a unanimous decision authored by Justice Sotomayor, reversed the Ninth Circuit and ruled in favor of Mr. Friedman’s clients.

Every Kiss Begins with Kay – Sexual Harassment, Gender Discrimination, Retaliation

Hundreds Allege Sex Harassment, Discrimination at Kay and Jared Jewelry Company

Karen Henry was fired as retaliation for reporting sexual harassment.iled against Kay / Jared Jewelers
Kristin Henry, a former Sterling employee, is seen in her apartment in Sanford, Fla. Henry says she was 22 when a district manager tried to kiss and touch her. After reporting the incident, she says, she was falsely accused of theft and fired. (Eve Edelheit for The Washington Post)

Hundreds of former employees of Sterling Jewelers, the multibillion-dollar conglomerate behind Jared the Galleria of Jewelry and Kay Jewelers, claim that its chief executive and other company leaders presided over a corporate culture that fostered rampant sexual harassment and discrimination, according to arbitration documents obtained by The Washington Post.

Declarations from roughly 250 women and men who worked at Sterling, filed as part of a private class-action arbitration case, allege that female employees at the company throughout the late 1990s and 2000s were routinely groped, demeaned, and urged to sexually cater to their bosses to stay employed. Sterling disputes the allegations.

The arbitration was first filed in 2008 by more than a dozen women who accused the company of widespread gender discrimination. The class-action case, still unresolved, now includes 69,000 women who are current and former employees of Sterling, which operates about 1,500 stores across the country.

Statements allege that top male managers, some at the company’s headquarters near Akron, Ohio, dispatched scouting parties to stores to find female employees they wanted to sleep with, laughed about women’s bodies in the workplace, and pushed female subordinates into sex by pledging better jobs, higher pay or protection from punishment.

Though women made up a large part of Sterling’s sales force, many said they felt they had little recourse with their mostly male management. Sanya Douglas, a Kay sales associate and manager in New York between 2003 and 2008, said a manager even had a saying for male leaders coaxing women into sexual favors to advance their careers, calling it “going to the big stage.”

“If you didn’t do what he wanted with him,” she said in the 2012 sworn statement, “you wouldn’t get your (preferred) store or raise.”

Not all of the 69,000 class members are alleging sexual impropriety. Many are accusing Sterling of wage violations, arguing women were systematically paid less than men and passed over for promotions given to less experienced male colleagues.

Sterling, like other U.S. companies, requires all workers to waive their right to bring any employment-related disputes against their employer in public courts. Instead, complaints must be decided in arbitration — a private, quasi-legal system where cases are guaranteed little transparency.

Signet Jewelers, the parent company of Sterling, has its headquarters in Fairlawn, Ohio. (Dustin Franz for The Washington Post)

More than 1,300 pages of sworn statements were released Sunday and feature company-approved redactions that obscure the names of managers and executives accused of harassment or abuse. But a memorandum by the employees’ attorneys supporting their motion for class certification, filed in 2013, revealed that top executives including Mark Light, now chief executive of Sterling’s parent company, Signet Jewelers, were among those accused of having sex with female employees and promoting women based upon how they responded to sexual demands.

Mark Light accused of sexual harassment, gender discrimination, retaliation.
Mark Light, seen June 15, 2016, in New York, is chief executive of Signet Jewelers, Sterling’s parent company. A memo filed in 2013 as part of the case says that top executives including Light were among those accused of having sex with female employees and promoting women based on how they responded to sexual demands. (Chris Goodney/Bloomberg News)

Many of the most striking allegations stem from the company’s annual managers meetings, which former employees described as a boozy, no-spouses-allowed “sex-fest” where attendance was mandatory and women were aggressively pursued, grabbed, and harassed.

Multiple witnesses told attorneys that they saw Light “being entertained” as he watched and joined nude and partially undressed female employees in a swimming pool, according to the 2013 memorandum.

Routine sexual “preying” at company events “was done out in the open and appeared to be encouraged, or at least condoned, by the company,” Melissa Corey, a manager of Sterling stores in Massachusetts and Florida between 2002 and 2008, said in her declaration.

Ellen Contaldi, a Sterling manager in Massachusetts between 1994 and 2008, said in her declaration that male executives “prowled around the (resort) like dogs that were let out of their cage and there was no one to protect the female managers from them.”

“I didn’t like being alone, anywhere. I used to dread going” to the meetings, Contaldi told The Post in an interview. “If you were even remotely attractive or outgoing, which most salespeople are, you were meat, being shopped.”

“It was like nobody knew right from wrong, and there was nobody trying to show anybody right from wrong,” Contaldi added. “There was no discipline. There was no consequence. You were on your own.”

Former employees who sought help or reported abuse through an internal hotline alleged in their declarations that they were verbally attacked or terminated. Kristin Henry, a five-year Sterling employee who said she was 22 when an older district manager tried to kiss and touch her at a managers event, told The Post she was falsely accused of theft and quickly fired after reporting his advances to superiors at Sterling.

Kristin Henry comments about predatory behavior at Kay / Jared / Signet Jewelers.
“They’re still hiring younger women, and I worry about those women,” Kristin Henry said. (Eve Edelheit for The Washington Post)


The case, Jock et al. v. Sterling Jewelers, was filed before the American Arbitration Association, one of the nation’s largest arbitration organizations. Kathleen A. Roberts, the case’s arbitrator, and a retired federal magistrate is forbidden by association rules from speaking with the media. Like other arbitrations, the case before Roberts is conducted in private and is legally binding. While arbitrator decisions are appealable, there are very limited grounds on which decisions can be overturned. The confidential nature of the case has made it difficult to determine why it has taken so long to resolve.

In a 2015 decision to grant class-action status to the women, Roberts wrote that the testimony includes references to “soliciting sexual relations with women (sometimes as a quid pro quo for employment benefits), and creating an environment at often-mandatory Company events in which women are expected to undress publicly, accede to sexual overtures and refrain from complaining about the treatment to which they have been subjected.”

“For the most part Sterling has not sought to refute this evidence,” Roberts wrote. Instead, she wrote, “Sterling argues that it is inadmissible, irrelevant and insufficient to establish a corporate culture that demeans women.”

The case could deeply tarnish a business that sells billions of dollars worth of jewelry a year through romance-centered marketing campaigns such as “Every Kiss Begins with Kay.” Signet told shareholders in an annual report last year that it would have to “pay substantial damages” if it lost the case.

Sterling’s mall outlets and storefronts account for a large chunk of America’s jewelry market, as well as more than 18,000 jobs across all 50 states. Its parent company, Signet, which is domiciled in Bermuda but headquartered in Ohio, is the world’s largest retailer of diamond jewelry, selling more than $6 billion of jewelry, watches, and services in 2015, company filings show.

Joseph M. Sellers, a partner at the Cohen Milstein law firm and lead counsel for the case, told The Post in an interview that the former employees’ statements provide “breathtaking evidence of ways in which women were mistreated in the workplace.”

“It was terribly demeaning to them as women,” Sellers said, “not just because they themselves were mistreated but because they saw how their co-workers were treated as sexual objects.”

‘Backed into a corner’

When Heather Ballou left her job at a small jewelry store and moved to a Kay retail outlet in Pensacola, Fla., in 2000, she believed she had made the right move to advance her young career. Sterling seemed to offer high standards, a professional atmosphere, and managers willing to groom and mentor new employees, Ballou, a class member in the arbitration, said in an interview with The Post.

As she worked her way up to store manager, though, she said, she became increasingly disturbed at the frequency of sexual harassment from the company’s crude “boys club.” At a managers meeting in 2005, a district manager promised to help transfer her to a better store if she had sex with him, she said in her sworn statement. That night, she did, believing she was “backed into a corner” and had no other way to advance.

“Looking back, I can’t believe I did some of the things I had to do,” Ballou, 41, told The Post, adding that in the moment she thought: “You suck it up and do what you have to do for your family. You need this job.”

Healther Ballou member of class action discrimination case against Kay / Jared / Signet Jewelers.
Heather Ballou, seen in Gulf Breeze, Fla., said while she was at a managers meeting in 2005, a district manager promised to help transfer her to a better store if she had sex with him. (Bonnie Jo Mount/The Washington Post)

Ballou attended four of Sterling’s multi-day managers meetings, where attendance was mandatory for managers at company stores nationwide. The events, which were mostly held in Orlando, included daytime work seminars but were infamous for their wild parties at night, employees said. It was common practice, former employees said, for executives and high-level managers to ply subordinates with alcohol.

One night, Ballou told The Post, she saw a top executive watching as female managers in varying stages of undress splashed in a hotel pool. “He had a drink in one hand and a cigar in the other, just taking it all in, like, ‘I am the king and this is my harem,’ ” she told The Post. She was prevented by her attorneys from naming which executive was involved, because of the condition of the arbitration documents’ release. The 2013 class-action motion states Light took part in a pool-related incident similar to the one Ballou described.

Henry, who attended the 2005 meeting, said she was retrieving her shawl from a hotel room when a male district manager who was her father’s age, and whom she had been told to treat like a mentor, forcibly tried to kiss and touch her. Stunned, she left immediately afterward and called her parents for advice.

“I was so embarrassed,” she told The Post. “I was afraid of what would happen next, how I would be treated if it was something he would tell other employees about.”

A few days later, she called an internal hotline to report the encounter, believing her identity would be protected. But within days of her report, a regional boss visited her store for two days, interviewed her co-workers, and reviewed surveillance video before accusing her of stealing a gold necklace and $100 in cash. She told The Post she showed the boss evidence that she had not stolen anything, but Sterling fired her, a few days before she was set to receive an annual commission payment worth roughly $30,000, she alleged.

Because she was fired and accused of theft, she told The Post, that she was unable to find a job at another jewelry store. Now 34, she works as a nurse in Florida.

“Friends to this day ask: What ever happened to that job? And it’s one of those situations: Do I tell the truth? Or do I say I just moved on, to save myself the embarrassment?” she told The Post. Seeing Kay commercials, she said, continues to unnerve her.

“They’re still hiring younger women, and I worry about those women,” she told The Post. “I worry about what might happen to them.”

Heather Ballou discribes trauma after discrimination.
“I can’t even go into a Kay anymore. It just turns my stomach,” says Ballou, who now works as an office manager. (Bonnie Jo Mount/The Washington Post)

Julia Highfill, a nine-year Sterling manager in Florida, Louisiana, and Mississippi, said in her sworn statement that the company “did not have an effective or serious mechanism by which female employees could complain about their mistreatment.” After calling the company to report that a district manager had arrived to work late and reeking of alcohol, she alleged that he called soon after to warn her against calling again. He told her, “Anything you say, I’m going to know,” she recalled in an interview.

Men who are not part of the class also filed sworn statements alleging Sterling was a hostile workplace for women. Richard Sumen, who worked for Sterling in Ohio from 1992 until 2005, said in his declaration that a group of managers and officers are commonly known as the “good ole boys” was infamous for “protecting and promoting their friends, and wild escapades of sex, drugs, excessive drinking and womanizing.” He recalled one former Ohio-based executive saying, “Why pay women more when they just get pregnant and have families?”

In his sworn statement, Sumen also recounted an incident at corporate headquarters in which an executive pointed to a female secretary and asked a district manager, “Are you doing her?” The secretary looked visibly uncomfortable, Sumen said, but the executive said again, louder, “I want to f—ing know if you are f—ing doing her.”

Sumen told The Post that he remained troubled by what he called Sterling’s discriminatory corporate climate. He wrote in his 2008 declaration, “This culture of sexism and womanizing was so prevalent that female management employees were pressured to acquiesce and participate.”

Like ‘an abusive relationship’

This culture seemingly arose in a company whose sales force was mostly women. More than 68 percent of Sterling’s store managers are women, the company told The Post. Three of Signet’s 10 executive officers are women. A job-recruitment video calls Sterling “your place to shine” and promises an “exciting and fulfilling career.”

Light was made Sterling’s chief executive in 2006 and presided over an eight-year growth streak during which the company’s sales more than tripled. Light, now 54 and chief executive of Signet, earned about $7.4 million in salary, stock, and bonuses in fiscal 2016, up from $2.4 million in 2014, company filings show.

Signet, the parent company of Sterling, Zales, and other jewelry brands, has struggled in recent months because of disappointing holiday sales, investors’ worries over how much of its jewelry is bought on credit, and a scandal during which Kay customers alleged diamonds they had brought in for cleaning were swapped for lesser-quality stones. The company denied the diamond-swapping allegations. Its share price has dropped by half since its late-2015 peak.

Since 1998, Sterling has forced all employees to agree to arbitration — a no-judge, no-jury resolution system that allows companies to keep potentially embarrassing labor disputes and case records mostly confidential.

The nonprofit American Arbitration Association, where the Sterling case is being heard, allows companies to refuse arbitrators they believe will not fairly rule on their case.

Some companies have argued that arbitration allows them a quicker path to resolving employee disputes beyond traditional courts. Workers effectively consent to the rules when they sign agreements requiring arbitration as a condition of their employment, as seen with Sterling’s contracts.

The Equal Employment Opportunity Commission said in a report last year that mandatory arbitration policies “can prevent employees from learning about similar concerns shared by others in their workplace.”

Ballou, who left the company in 2009, is hoping the case leads to more than back pay. Now 41, the single mother is back in school studying to become a registered nurse and working as an office manager for a real estate company, where she told The Post she “hasn’t encountered an inkling” of what she saw at Sterling.

“What’s sad is that I was there for so long, it was almost like when someone is in an abusive relationship: You think that’s what normal is,” she told The Post.

“I can’t even go into a Kay anymore. It just turns my stomach,” she added. “Even seeing those ‘Every Kiss Begins with Kay’ commercials revolts me, thinking of what’s behind them. All the good things they do, all the lovely things they promise. It’s a lie.”

Ballou talks about life beyond Sterling.
Kristin Henry, a former Sterling employee, is seen in her apartment in Sanford, Fla. Henry says she was 22 when a district manager tried to kiss and touch her. After reporting the incident, she says, she was falsely accused of theft and fired. (Eve Edelheit for The Washington Post)

She told The Post she wanted to speak out in hopes that it could help other women, as well as her 8-year-old daughter.

“I was a victim, and I didn’t have anyone to speak for me,” Ballou said. “As humiliating as it was, it was worth it, because now maybe it won’t happen to her.”

Read more by Drew Harwell

Supreme Court Allows Statistical Evidence In Class Actions

In Tyson Foods, Inc. v. Bouaphakeo, 136 S. Ct. 1036 (2016), a 6-2 opinion written by Justice Kennedy, the Supreme Court took a (small) step back from that draconian anti-class action bulwark – Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 131 S. Ct. 2541 (2011). The Supreme Court made clear that plaintiffs may use “representative evidence,” not specific as to each individual involved, to show that the group could have had the same legal claim, without having to prove it individually – “a representative or statistical sample, like all evidence, is a means to establish or defend against liability.” It is allowed into a trial, of a class action or other type of case, depending “on the degree to which the evidence is reliable in proving or disproving the elements” of the legal claim at stake, the opinion added. “It follows that the Court would reach too far were it to establish general rules governing the use of statistical evidence, or so-called representative evidence, in all class-action cases.”

“In many cases,” according to the Court majority, “a representative sample is ‘the only practicable means to collect and present relevant data’” to prove that the company or entity being sued was legally at fault. The opinion went on to provide some guidance to when such evidence would be allowed into a class action case: that is, when each member of the class could rely on the sample to establish that he would have won the case, if he had filed it individually, rather than along with others.

Important New California Employment Laws For 2016

California passed a bevy of new employment laws in 2016. Here is a summary of the most important ones.

Minimum Wage Increases (SB 3)

Beginning on January 1, 2017, employers with 26 or more employees will have to pay a minimum wage of $10.50 per hour. This minimum wage rate will gradually increase to $15.00 per hour by 2022 as shown below:

January 1, 2017 – 10.50
January 1, 2018 – 11.00
January 1, 2019 – 12.00
January 1, 2020 – 13.00
January 1, 2021 – 14.00
January 1, 2022 – 15.00
January 1, 2023 – 15.00

Smaller employers (with 25 or fewer employees) will be required to pay the higher minimum wage rates starting in 2018 as shown below:

January 1, 2017 – 10.00
January 1, 2018 – 10.50
January 1, 2019 – 11.00
January 1, 2020 – 12.00
January 1, 2021 – 13.00
January 1, 2022 – 14.00
January 1, 2023 – 15.00

Equal Pay Act Expanded To Cover Race And Ethnicity (SB 1063)

In 2015, the California Legislature enacted and Governor Brown signed Labor Code Section 1197.5 into law which made it the Nation’s most protective equal pay act. Section 1197.5 didn’t just require employers to pay employees of opposite genders equal pay for equal work but, instead, required equal pay for substantially similar work. This year, the Legislature enacted and Governor Brown signed into law amendments to the Equal Pay Act which prohibit wage differences based upon race or ethnicity for substantially similar work when viewed as a composite of skill, effort, responsibility, and performed under similar working conditions.  Exceptions include where the payment is made based on any bona fide factor other than sex/race/ethnicity, such education, training, or experience.

Employers Prohibited From Using An Employee’s Prior Salary To Justify Wage Differences (AB 1676)

Employers often try to justify differences in pay between men and women by explaining that they based the differences on the employees’ prior salaries. This new law prohibits employers from using an employee’s prior salary, by itself, to justify any compensation disparity.

Employer’s Required To Provide Employees With Notice Regarding Domestic Violence, Sexual Assault And Stalking Protections (AB 2337)

California law prohibits employers from terminating or in any other manner discriminating or retaliating against an employee who takes time off from work to address domestic violence, sexual assault, or stalking. This new law mandates that employers must inform each employee of his or her rights established under these laws by providing certain information in writing to new employees upon hire and to other employees upon request.

Settlement Agreements Can No Longer Prevent The Disclosure Of Information Regarding Certain Sex Offenses (AB 1682)

Existing law allows parties to enter into a settlement agreement requiring the nondisclosure of information regarding sex offenses. This new law now prohibits parties from entering into settlement agreements (on or after January 1, 2017) that would prevent the disclosure of factual information that establishes a cause of action for civil damages for a felony sex offense, an act of childhood sexual abuse, an act of sexual exploitation of a minor, or an act of sexual assault against an elder or dependent adult.

Employees Of Temporary Services Employers Must Be Paid Weekly (AB 1311)

Current law (Labor Code Section 201.3) requires that temporary services employers must pay their employees weekly and that a violation of these provisions is punishable as a misdemeanor. This new law extends this weekly pay requirement to security guards employed by those who are both private patrol operators and temporary services employers.

Employers Can Not Ask An Applicant To Disclose Certain Criminal History Information (AB 1843)

Section 432.7 of the Labor Code prohibits employers (both public and private) from asking applicants for employment to disclose, or from utilizing as a factor in determining any condition of employment, information regarding an arrest or detention that did not result in a conviction.  Certain information concerning a referral or participation in any pretrial or post-trial diversion program is also prohibited from disclosure.

This new law now prohibits an employer from asking applicants for employment to disclose, or from utilizing as a factor in determining any condition of employment, information concerning or related to an arrest, detention, processing, diversion, supervision, adjudication, or court disposition that occurred in juvenile court. In addition, this law provides that “conviction,” as used in the statute, excludes an adjudication by a juvenile court or any other court order or action taken involving a person who is under the jurisdiction of the juvenile court.

Employers Prohibited From Engaging In Certain Unfair Immigration-Related Practices (SB 1001)

Employers are prohibited from: (a) request more or different documents than are required under federal law; (b) refuse to honor documents or work authorization based upon the status or term of status that accompanies the authorization to work; or (c) reinvestigate or reverify an incumbent employee’s authorization to work.  Applicants are authorized to file a complaint with the Division of Labor Standards Enforcement.

California Employees Guaranteed Access To California Law And Forum (SB 1241)

This bill applies to contracts entered into, modified, or extended on or after January 1, 2017 and prohibits an employer from requiring an employee who primarily resides and works in California, as a condition of employment, to agree to adjudicate outside of California a claim (in either litigation or arbitration) arising in California or deprive the employee of the substantive protection of California law with respect to a controversy arising in California. The bill specifies that injunctive relief is available as a remedy and authorizes a court to award reasonable attorney’s fees. The bill exempts a contract with an employee who was represented by legal counsel.