302 | 2023 Cal-Peculiarities ©2023 Seyfarth Shaw LLP www.seyfarth.com 154 Although no California appellate authority seems to have addressed the constitutionality of imposing a penalty of thirty days’ wages for a relatively minor underpayment of wages, courts have recognized that a “penalty prescribed [can be] so severe and oppressive as to be wholly disproportioned to the offense and obviously unreasonable.” United States v. Citrin, 972 F.2d 1044, 1051 (9th Cir. 1992). 155 Diaz v. Grill Concepts Servs., Inc., 23 Cal. App. 5th 859, 874 (2018) (“Labor Code section 203 does not imbue trial courts with the discretion to waive or reduce waiting time penalties.”). 156 Nishiki v. Danko Meredith, APC, 25 Cal. App. 5th 993 (2018) (as to initial delay in payment the employer’s failure to pay termination wages was not willful, because an inadvertent clerical error resulted in the wrong amount being shown on the paycheck; but delay in sending a corrected check was willful and warranted waiting-time penalties). 157 McCoy v. Superior Court (Staffing Servs., Inc.), 157 Cal. App. 4th 225 (2007). 158 Pineda v. Bank of Am., NA, 50 Cal. 4th 1389 (2010). 159 Id. at 1401 (internal citations omitted). 160 Office of Chief Counsel Advice Memorandum 201522004, https://www.irs.gov/pub/irs-wd/201522004.pdf (visited May. 26, 2022). The Chief Counsel’s advice memo, provided to field or service center employees, is not something that a taxpayer can cite as precedent. 161 Encino Motorcars, LLC v. Navarro, 138 S. Ct. 1134, 1142 (2018) (describing Ninth Circuit opinion). 162 Id. (internal quotation marks and citations omitted). 163 Peabody v. Time Warner Cable, Inc., 59 Cal. 4th 662, 667 (2014). 164 29 C.F.R. § 541.600(a). 165 Lab. Code § 515(a). 166 Semprini v. Wedbush Securities, Inc., 57 Cal. App. 5th 246 (2020). 167 Conley v. PG&E Co., 131 Cal. App. 4th 260, 271 (2005) (“[N]othing in California law … precludes an employers from following the federal rule that permits them to require the use of vacation leave for partial-day absences without causing otherwise exempt employees to become nonexempt under the salary basis test.”). 168 DLSE Opinion Letter 2009.11.23. 169 Rhea v. Gen. Atomics, 227 Cal. App. 4th 1560, 1575-76 (2014) (“We conclude that regardless of whether the absence is at least four hours or a shorter duration, a requirement that exempt employees use Annual Leave time for a partial day absence does not violate California law.”). 170 See IWC Wage Orders § 1(A)(1). 171 29 C.F.R. § 541.106(b). 172 Heyen v. Safeway Inc., 216 Cal. App. 4th 795, 827 & n.8 (2013) (rejecting argument that trier of fact should account for simultaneously performing exempt and nonexempt tasks, such as actively managing store while also checking and bagging customer grocery purchases; noting that California Legislature has not elected to follow the federal regulation). 173 See old 29 C.F.R. § 541.113. 174 See IWC Wage Orders § 1(A)(3). 175 “[P]harmacists employed to engage in the practice of pharmacy, and registered nurses employed to engage in the practice of nursing, shall not be considered exempt professional employees, nor shall they be considered exempt … unless they individually meet the criteria established for exemption as executive or administrative employees.” IWC Wage Orders § 1(A)(3)(f). 176 An employee who merely applies knowledge in following prescribed procedures or in determining which procedure to follow does not exercise “discretion and independent judgment,” but rather is simply applying skill and knowledge. “Discretion and independent judgment” consists of comparing and evaluating possible courses of conduct, and making a decision after considering the various possibilities. 177 See IWC Wage Orders § 1(A)(2). 178 Bell v. Farmers Ins. Exchange, 87 Cal. App. 4th 805 (2001). 179 Id. at 812. 180 See, e.g., Dalheim v. KDFW-TV, 918 F.2d 1220, 1230 (5th Cir. 1990) (“The distinction § 541.205(a) draws is between those employees whose primary duty is administering the business affairs of the enterprise from those whose primary duty is producing the commodity or commodities, whether goods or services, that the enterprise exists to produce and market.”). 181 Bell, 87 Cal. App. 4th at 823-28. 182 29 C.F.R. §§ 541.2(a), 541.201. 183 Bell, 87 Cal. App. 4th at 826. 184 E.g., Miller v. Farmers Ins. Exch., 481 F.3d 1119 (9th Cir. 2007) (criticizing Bell’s interpretation of the administrative/professional dichotomy and finding insurance adjusters categorically to qualify as exempt employees). 185 29 C.F.R. § 541.203(a). See also former C.F.R. § 541.205(c)(5) (identifying insurance adjusters within the universe of employees often covered by the administrative exemption). The current regulations still require an adjuster to meet the duties test to qualify as exempt, which requires the adjuster to perform such activities as “interviewing insureds, witnesses and physicians; inspecting property damage; reviewing factual information to prepare damages estimates; evaluating and making recommendations regarding coverage of claims; determining liability and total value of a claim; negotiating settlements; and making recommendations regarding litigation.”
RkJQdWJsaXNoZXIy OTkwMTQ4