Employers can (and should) require pre-employment drug testing, and refuse to hire a prospective employee if he/she fails to pass the drug test, provided notice and consent was properly given and obtained. Drug screens should only be conducted after a job offer has been made, and not as a way to screen applications. If the prospective employee refuses to take the test, the job offer can also be withdrawn, provided the employer gave all of the required notices and followed applicable law. But what if the drug test is inconclusive? And what should an employer do if an employee appears intoxicated at work? Read on for guidance on these tricky situations, and more.

The Scali Law Firm is pleased to announce that it has been chosen by the California New Car Dealers Association (CNCDA) to revise its 2015 Advertising Law Manual, published and available to California auto dealers who are members of the CNCDA. In 2015, the Scali Law Firm was asked to do a substantial re-write and re-working of the CNCDA’s first Advertising Law Manual, originally published in 2006, before the proliferation of digital and Internet vehicle advertising. The 2015 re-work focused on advertising in electronic media and via digital platforms.

In an unpublished decision in March, the Ninth Circuit (the federal circuit court governing California, Oregon, Washington, Nevada, Arizona, Hawaii, Alaska, Montana and Idaho) permitted arbitration of a worker's Private Attorneys General Act (PAGA) claim, holding that an individual employee contract can bind government parties. The California Supreme Court's Iskanian v. CLS Transportation Los Angeles decision "does not require that a PAGA claim be pursued in a judicial forum," the court said, and "clearly contemplate[d] that an individual employee can pursue a PAGA claim in arbitration, and thus that individual employees can bind the state to an arbitral forum."

Dealerships are taking another look at their commission pay plans in light of the recent California Court of Appeal case of Vaquero v. Stoneledge Furniture, LLC., which we featured in our March 1, 2017 Alert article. The Vaquero Court held that commission pay plans providing base pay covering time spent on rest breaks that could be “clawed-back” subject to future earnings was invalid under California law. Specifically, the Court held that employees who earn only commissions must be paid separately for rest breaks (since the commissions do not cover time spent resting), and that employers who pay employees both hourly wages and some form of incentive pay, including commissions, violate the rest period pay requirement if they claw back any part of the employees’ base hourly pay as a draw or advance against commissions.

As you have probably read, the Federal Trade Commission (FTC)’s new version of the Buyers Guide took effect on January 27, 2017. We recommend upgrading to the new version and here are a few main issues to consider regarding its use.

On March 15, 2017, the California New Motor Vehicle Board unanimously adopted a proposed decision sustaining the consolidated protests by Dependable Dodge to notices of termination of its franchises. The administrative law judge found, among other findings, that FCA’s use of a generic Minimum Sales Responsibility was not “tailored and nuanced enough to measure how well a dealer is performing given those unique aspects of the environment and market that are outside its control.” (Proposed Decision ¶ 142.) This is the second of two recent cases challenging OEM’s reliance on statewide standards to terminate California franchises, and part of what could be a bigger trend nationally.

On April 25, 2017 the Department of Motor Vehicles will hold a public hearing in Sacramento for comments on its new proposed regulations for testing and deployment of highly autonomous vehicles (“HAV”) on California roadways. The hearing will happen just one month before the National Highway Safety Administration holds its workshop on June 28, 2017, in Washington D.C., to examine the consumer privacy and security issues posed by automated and “connected” vehicles. The DMV’s new proposed regulations include a requirement that HAVs without a driver be monitored remotely by a person able to take control of the car in case of an emergency. NHTSA’s June workshop should provide insight on the extent to which California’s proposal for “remote” control capabilities of HAV test vehicles lines up with the NHTSA’s vision for the driverless car future.

When you become aware of a potential violation of law or Company policy, as a conscientious Human Resources professional or Company manager you want to promptly and appropriately address the situation and more forward. However, managers often jump to focus on the corrective measures they think will appropriately address the situation before stopping to consider that there may be other sides to the story of which they are not aware. Moreover, should your corrective action result in some adverse employment action, such as discipline, demotion or termination, your process of determining the appropriate corrective action will be subject to second-guessing and scrutiny should the employee later challenge the action. While your corrective process may be correct and may have been the fair and appropriate response, you can save your employer the time and expense of proving that point in court or before an arbitrator if you focus on conducting a fair and effective investigation instead of worrying about the result.

Under the federal Fair Credit Reporting Act (“FCRA”) employers who use background checks (such as criminal history or credit reports) of applicants or employees are required to provide clear and conspicuous written disclosure of the applicant/employee’s rights under the FCRA. The written disclosure must be provided in a document that consists solely of the disclosure. The third-parties doing the background checks often provide employers their own disclosure forms to give to applicants, and the employers might assume that these forms are legally compliant.