Budget Impasse in CA Linked to Labor Law

We've written about some of the predatory practices of corporations toward their employees, and even though we've only scratched the surface so far--doctoring records in order to avoid paying workers for all the hours they worked; the threats, intimidation, even blackmail when workers try to unionize; the rising demand that we work part-time without pay, and so on (there's a lot more)--it's probably clear by now that too many employers can't be trusted either to be fair to their employees or to obey the law.

Well, in California they passed a law that allows employers to be sued by workers diectly for violations and mistreatment. At least in part, it seems the budget battle is hung up over this law.

By Marc Lifsher, LA Times Staff Writer


SACRAMENTO — As the struggle to pass a state spending plan drags on, legislative leaders are trying to negotiate changes to a new labor law that Gov. Arnold Schwarzenegger and business groups have linked to the budget battle.

The governor claims that the law, which the California Chamber of Commerce derisively calls the "sue your boss" statute, has unleashed a torrent of frivolous litigation over alleged labor code violations. At the recent shopping center rally where the governor called Democrats blocking his proposed budget "girlie men," he also denounced the law as a job killer that "chases businesses way from California."

The law allows private lawyers to sue employers for labor law violations. Proponents say it addresses a need for increased enforcement of the state's workplace regulations.

"Wage and hour disputes are serious allegations and, if proven, worthy of penalties being leveled against employers," said state Sen. Joe Dunn (D-Santa Ana), the law's author.

A survey of lawsuits filed since the law went into effect in January shows that many of the approximately 50 pending cases involve basic, lunch-bucket issues such as claims for back pay and overtime pay. One Los Angeles attorney has filed about 20 suits seeking back double-time pay for off-duty Los Angeles police officers who provided security on movie, video and commercial shoots.

"This legislation helps level the playing field," said Alan Harris, a Los Angeles lawyer who has used the law to sue a number of major movie studios and their payroll service contractors. "In Hollywood, we're dealing with multinational corporations that have limitless assets, and the employees have no one to stand up for them."

Dunn said he was willing to fine-tune the law but stressed he "won't even discuss a repeal or a de facto repeal."

This year, Dunn introduced a follow-up bill to ban suits for "technical violations" such as small print on posters. His bill, which passed the Senate and is currently before the Assembly Appropriations Committee, would authorize judges to reduce or eliminate awards that are arbitrary or unfair.

"I don't want to clog up the court system," he said.

Republicans, so far, have rejected Dunn's second bill. But that steadfast position may be beginning to ease. For the last two days, Dunn and Senate Minority Leader Dick Ackerman (R-Irvine) have been negotiating a possible middle ground that would be "reasonable for business" and still give workers protections for serious labor law violations, Ackerman said.

Schwarzenegger and his allies complain that the law, signed last year by then-Gov. Gray Davis, gives attorneys a license to sue deep-pocket companies for minor infractions of state labor regulations. As evidence, they point to a recent suit seeking six-figure damages from a company accused of using overly small type on posters listing workplace rules.

"It's ludicrous. The penalties simply don't fit the infractions," said Jeanne Cain, senior vice president of the California Chamber of Commerce, which is leading the repeal fight.

Backers of the labor law, mainly labor unions, contend that years of budget cuts have hamstrung the state labor commissioner's ability to protect workers' rights. They stress that 75% of civil penalties collected by successful lawsuits would go into state coffers to finance general programs and additional labor enforcement activities.

"Our state does not have the resources to put into labor law enforcement that we used to have," said Barry Broad, a lobbyist for the International Brotherhood of Teamsters.

I find the concept that business would be 'chased away' from CA by a requirement that they obey the law or face legal penalties in the form of lawsuits protecting workers' rights to be telling. They want a pass on the responsibilities eveyone else has to follow the law on the basis of paranoia over frivolous litigation that will likely not go anywhere. The example they cite hasn't even gotten to court yet, and if it's as silly as it sounds (it may not be) it could well be thrown out; many--in fact, most--such cases are. And the ones that aren't turn out to be a lot less frivolous than coporations and their allies try to make them seem.

You may remember the infamous case of the woman who sued McDonald's because their coffee was too hot. Conservatives and corporate lobbyists used--and are still using--that case as a prime example of the kind of 'frivolous lawsuit' from which business needs protection. Oh, really?

The manager of that McD franchise had been warned repeatedly by inspectors that the coffee his stores were serving was overheated to the point of causing potential physical damage either to a customer or employee. The wornings were ignored. For over a year. The woman who brought the suit was so badly burned she had to be hospitalized, and needed three skin-graft operations to repair the damage to her legs.

That's the nature of the 'frivolous' lawsuits they want protection from. If CA wants to take a step to protect workers' rights and well-being, this law is a definite step in the right direction. If they let blatant scare-tactics from corporations seeking to evade their responsibilities deter them, they should be ahamed of themselves.