Recent legal decisions and legislation could affect hoteliers who have properties in California.
As summer turns to fall and the end of the year approaches, here is an overview of some recent legal decisions and legislation that could affect hoteliers with properties in California.
The PAGA saga: Expanded discovery rights for plaintiffs
The scope of discovery got a bit broader in California cases brought under the Private Attorneys General Act of 2004. In so-called PAGA actions—by which an employee may pursue a private right of action on behalf of himself or herself and aggrieved third parties against an employer to collect penalties for particular labor violations—an employer is now generally compelled to produce the contact information of its employees when asked for such information by an employee plaintiff.
For example, the ruling in Williams v. Superior Court, in which the California Supreme Court determined that the latitude for discovery in PAGA actions (including those brought against hotels and resorts) is essentially the same as that in class actions.
The Williams case seems to expose PAGA actions for what they are—class actions in disguise—and in the wake of the Supreme Court’s decision, allegedly wronged employees have the means to fish for similarly situated coworkers by way of more liberal discovery rights.
Transgender bathroom laws in California: What employers need to know
The rights and civil liberties of transgender people have become an important topic openly discussed and debated nationwide. Clearly, the issues confronting the transgender community are many, but it seems press coverage has boiled the plight down to a rather narrow question: which public restroom should transgender men, women, boys and girls use?
As society comes to grips with transgender issues, it is important that those doing business in the hospitality space fully understand the status of relevant access laws, including one that became effective in California on 1 March 2017. As set forth in Health and Safety Code §118600, any business establishment having a single-use bathroom—one having “no more than one water closet and one urinal with a locking mechanism controlled by the user”—must identify that bathroom as “all gender.”
In the wake of this relatively new law, employers must ensure that their bathroom signage is in compliance. Rest assured, doing so is as simple as equipping all single-user restrooms with unisex geometric signage (a triangle superimposed onto a circle) that is tactile (can be read by touch) and indicates the facility as all-gender, unisex or just a restroom (without reference to gender). Hoteliers take note, this must be done whether or not any given employer has transgender employees.
Salary inquiries becoming a thing of the past
San Francisco has become the most recent jurisdiction to prohibit employers from inquiring about a job applicant’s salary history, a move designed to close the gender pay gap. The Parity in Pay Ordinance, which takes effect next year, will ban employers (hotel and resort owners/operators among them) from seeking such information during the hiring process. Indeed, under the new law, salary history cannot be considered or relied upon by an employer in determining whether to extend a job offer or in formulating its terms. That being said, if a prospective employee voluntarily discloses his or her salary history without prompting, an employer may take steps to confirm the information and use it when making hiring decisions.
Similar laws have already been enacted in Philadelphia and New York City as well as the states of Massachusetts, Oregon and Delaware. In response, hoteliers with properties in any of these locales should make certain that their applicant screening and hiring protocols are compliant.
Arbitration agreements: Do yours include all necessary carve-outs?
A 2017 decision by the California Supreme Court affects the ability of employers, including hotel owners/operators, to arbitrate certain disputes with employees. For a variety of reasons, many employers find arbitration to be a preferred forum for dispute resolution: the chance to avoid unreasonable damage awards; simplified rules of civil procedure and evidence; a faster, more cost-effective and confidential process from beginning to end (including more streamlined discovery); and the ability to potentially avoid class actions. Likewise, arbitration facilitates the management of an employer’s legal risk to the extent a comprehensively written arbitration agreement prohibits or otherwise limits some of the remedies employees can routinely seek in court; class action exposure, for example.
In McGill v. Citibank NA, however, the Supreme Court ruled that an arbitration provision that waives the right to a public injunction is contrary to California public policy and, therefore, unenforceable. Given the outcome of McGill, employers in the hospitality industry would help themselves by including provisions in their arbitration agreements carving out claims for public injunctive relief, as well as other categories of disputes not subject to arbitration (e.g., the right to bring representative actions under PAGA, etc.).
Diyari Vazquez is counsel at Michelman & Robinson, LLP, a national law firm with offices in Los Angeles, Orange County (California), San Francisco, Chicago and New York City. She represents clients in the hospitality industry, and advises them in matters related to labor and employment law, including discrimination, harassment, wrongful termination, reduction in workforce, hiring, wage and hour issues and more. Contact her at 310-564-2670 or firstname.lastname@example.org.
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