Author: Mazzola Law Office P.C.

The ADA, the Unruh Act, and California’s Construction-Related Accessibility Standards Act

Post author By Mazzola Law Office P.C.
Post date February 8, 2014

Click here for the link to Part 1 of this Article dealing with the ADA or here for the link to Part 2 of this Article dealing with the Unruh Act and California’s Construction Related Accessibility Standards Act.

Commercial property owners are now required to notify lessees about their property’s compliance with accessibility standards. Civil Code Section 1938 now states: A commercial property owner or lessor shall state on every lease form or rental agreement executed on or after July 1, 2013 whether the property being leased or rented has undergone inspection by a Certified Access Specialist (CASp), and, if so, whether the property has or has not been determined to meet all applicable standards pursuant to Section 55.53.

The top 10 complaints received by California Commission on Disability Access are:

1 Parking. Loading zones/van access aisles are not compliant or non-existent.
2 Parking. Existing parking spaces are not compliant.
3 Accessible Route and Entry. Routes to and from parking lots are not accessible.
4 Parking. A parking lot does not contain minimum number of accessible parking spaces.
5 Parking. Signage in parking lot is not compliant. e.g., parking spaces need to be designated as reserved by a sign showing the symbol of accessibility.
6 Access within Public Facility. Heights of surfaces such as counters, bars, or tables are not compliant.
7 Access within Public Facility. Access aisles within the building are not accessible. e.g., dining or work surfaces are not on an accessible route.
8 Toilet rooms/Bathrooms. Grab bars in bathroom are non-existent, or grab bars are not compliant.
9 Toilet rooms/Bathrooms. Lavatories and mirrors in bathroom are not accessible.
10 Accessible Route and Entry. Entry doors are not accessible.

This information is provided for informational purposes only and should not be construed as legal advice. It should not be acted upon without consulting a licensed California attorney about the facts, particular needs and questions of the person or entity considering these issues.

ADA, Unruh Act Construction

The ADA, the Unruh Act, and California’s Construction-Related Accessibility Standards Act

Post author By Mazzola Law Office P.C.
Post date February 7, 2014

Click here for the link to Part 1 of this Article dealing with the ADA.

The Unruh Act is California’s state law equivalent of the ADA. The Unruh Act incorporates many provisions of the ADA, but there are some differences between the two statutes. As one major example, the Unruh Act provides for payment of damages to a plaintiff where the ADA does not allow for damages.

Another significant area of difference with the ADA is how the Unruh Act handles certain accessibility claims in public accommodations. The Construction Related Accessibility Standards Act was added to California’s Unruh Act in 2009 and was amended in 2012.

The Construction Related Accessibility Standards Act contains procedures that can help certain defendants avoid some of the turmoil and expense associated with a construction-related accessibility claim. An accessibility claim asserts that a defendant failed to adhere to statutory access standards of a business that is open to the public.

Some of the significant provisions of the Construction Related Accessibility Standards Act include:

• the establishment of the Certified Access Specialist program (CASp),
• a stay on some types of ADA litigation,
• limits on plaintiff attorneys sending pre-litigation “demands for money” letters • limits on stacking and milling of claims,
• reduced damages per violation,
• reduced attorney’s fees awardable to the plaintiff,
• requirements about providing specifics related to claims of being denied equal access to public accommodations

A CASp – A Certified Access Specialist (a CASp) is a person who has been certified by the State of California to assess the accessibility aspects of a business. If a public accommodation has been inspected and certified by a CASp, it may qualify for protections in litigation that are not otherwise available to a defendant.

Those protections include reduced damages, the ability to stay litigation, and an early settlement conference. A CASp should inspect all new construction and is also available to review and advise on existing accommodations to determine if they meet the access standards.

Stay on Litigation – If a business is CASp certified, it may be entitled to stay an accessibility lawsuit for 90 days and request early evaluation conference. Small businesses having less than 25 employees and falling below a certain gross revenue target over the preceding three years may also qualify for a stay on litigation if they promptly address the access concerns.

Demand Letters – A plaintiff attorney’s demand letter must now include the attorney’s State Bar number, a written advisory of rights and responsibilities, and list the facts that are reasonably necessary to identify the violations, all barriers encountered, how the barriers interfered with the plaintiff’s access, and the dates when the violations were encountered. The plaintiff’s attorney must also simultaneously send the demand letter to the California State Bar.

Stacking and Milling – The Construction-Related Accessibility Standards Act limits stacking and milling of claims. Stacking occurs when plaintiffs claim that they encountered access barriers on multiple occasions at the same location, thereby multiplying the statutory damages by the number of visits. Milling arises when an attorney brings virtually identical claims for the same plaintiff against multiple businesses.

Attorney’s fees – Attorneys fees are available when a plaintiff encountered violation or was deterred from public accommodations due to them. When determining the amount of reasonable attorney’s fees that can be awarded to a prevailing plaintiff, a court may now consider settlement offers made and rejected. This has the tendency to make plaintiff’s attorneys more reasonable in their demands.

The protections of the Construction-Related Accessibility Standards Act may not apply to ADA litigation venued in the federal courts.

Click here for the link to Part 3 of this Article dealing commercial property disclosures and common accessibility complaints.

ADA, Unruh Act Construction

The ADA, the Unruh Act, and California’s Construction-Related Accessibility Standards Act

Post author By Mazzola Law Office P.C.
Post date February 5, 2014

The Americans with Disabilities Act (ADA) is the federal law that requires all people receive full and equal access to public accommodations. Title Ill of the ADA prohibits discrimination based on disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation by any person who owns, leases or operates a place of public accommodation.

Public accommodations are defined as goods, services and privileges that are made available to the public. The ADA established requirements for twelve categories of public accommodations, which include:

• shopping malls,
• stores,
• restaurants,
• bars,
• service establishments,
• theaters,
• hotels,
• recreational facilities,
• private museums and schools,
• doctors’ and dentists’ offices,
• and other businesses.

Nearly all types of businesses that serve the public are included in the twelve categories, regardless of the size of the business or the age of their buildings. Commercial facilities, such as office buildings, factories, warehouses, or other facilities that do not provide goods or services directly to the public are nevertheless subject to the ADA’s requirements when they undergo construction and alterations.

The ADA requires removal of barriers to accessibility when it is “readily achievable” to do so. Readily achievable has been defined as “easily accomplishable without much difficulty or expense.” This requirement is based on the size and resources of a business. In determining whether an action is readily achievable, courts have considered the following factors:

• the nature and cost of the action needed to remove the barrier,
• the overall financial resources of the site involved,
• the fiscal relationship of the site in question to any parent entity,
• the overall financial resources of the parent entity.

Why is ADA compliance important for California business owners? California has 12% of the American population, but 40% of the ADA related litigation.

Click here for the link to Part 2 of this Article dealing with the Unruh Act and California’s Construction Related Accessibility Standards Act.

Independent Contractor Labor and Employment Labor Commissioner—the DLSE Wage & Hour

Zombie Employees

Post author By Mazzola Law Office P.C.
Post date July 29, 2013

Many California businesses use independent contractors. They do so for a handful of reasons, but one of the most common reasons is to save money. An independent contractor does not involve the same costs that an employee does, such as overtime, payroll taxes, vacation and sick time, and other benefits.

The perceived cost savings can come at a steep price for the employer in the form of an employee lawsuit for misclassification or a payroll audit by a governmental agency. The end result can be that an independent contractor is reclassified as an employee. This will cost the business owner significant amounts of money for unpaid overtime, payroll taxes, and other penalties, reaching backward in time three to four years.

Reclassification turns the independent contractor into an employee, retroactively, just like a zombie. And we all know how hard it is to kill zombies, especially ones that are due a lot of money.

Many of the large governmental agencies have cooperating agreements to share information with each other on employee misclassification. These agencies have been targeting employee misclassification since 2008 because their audits pay for themselves by bringing revenue into the agencies.

The IRS began a program that aims to audit 6,000 employers per year on the employment misclassification issue. Its projected haul is $7 billion over the next ten years.

On the federal level, the DOL and the IRS signed an agreement in 2011 to share information on misclassification issues they identify in their audits. Thus, an IRS audit is much more likely to follow an audit by the Department of Labor (DOL). California’s Secretary of Labor and the DOL signed a similar cooperative agreement in 2012.

California’s administrative agencies routinely share information with each other. A claim for unemployment benefits by a former independent contractor, which is not uncommon, will trigger an Employment Development Department (EDD) audit of the employer. Those results are now shared with the Division of Labor Standards Enforcement (DLSE).

Each agency has its own test for evaluating whether an employee or group of employees are independent contractors or employees. Their tests involve an evaluation of many factors to determine if the relationship is correctly classified as an independent contractor. A prior blog on some of those factors may be found through this link.

It is no surprise that the bias of the agencies is to find an employment relationship, not an independent contractor one. California has a presumption in its Labor Code in favor of finding the relationship to be one of employer – employee. It is then up to the employer to prove otherwise, if it can.

California recently enacted the Wage Theft Prevention Act (SB 459). It has enhanced penalties for misclassification, including per violation penalties of up to $15,000 per violation (a “violation” can occur each pay period). Further, an employer that has engaged in a pattern and practice of employee misclassification is also subject to a penalty of up to $20,000 per violation.

Under some circumstances, managers may now be held personally financially liable for their misclassification of independent contractors. This factor alone makes it all the more important for managers to really look at their independent contractors and seek legal advice on whether they are properly classified or not. The DOL estimates that one in three independent contractors are misclassified.

Simon Mazzola provides counseling and litigation service to business owners and managers in all aspects of California labor and employment matters.

Construction Mechanic's Liens Stop Notice

Changes to Mechanics Lien laws in 2012 – Part 2

Post author By Mazzola Law Office P.C.
Post date March 5, 2013

Two of the most commonly used remedies available to contractors are mechanics liens and stop payment notices. The rules and procedures affecting mechanics liens, stop payment notices and bond claims changed on July 1, 2012 (SB 189).

An earlier blog dealt with changes to these laws that took place in 2011. Part 1 of this blog for changes that took place in 2012 can be found here.

The following information is meant as general information only. One should not use this information to calculate the timing deadlines of these procedures. It is essential to take into account the specific facts and circumstances of each situation because they affect the timing, notice, and procedures. If the circumstances in this blog pertain to you or your company, contact our office to obtain advice on how to use them.

Stop Payment Notice – When there is a discrete sum of undisbursed construction funds, a contractor may file a Stop Payment Notice. Upon receipt of a Stop Payment Notice, the owner or construction lender holding the funds is required to sequester “sufficient funds” to pay the claimed amount. This has the effect of tying up those funds pending resolution of the matter. On a private works project, a contractor must obtain and serve a bond to require the lender to withhold the money claimed in a Stop Payment Notice.

Release of Lien/Waiver – During a construction project, it is good practice to use periodic lien releases to account for the sums requested and paid to contractors and subcontractors. This is done through the use of the Conditional and Unconditional Waiver and Release forms. The new language of these forms must be used as of July 1, 2012.

Release Bond – In the event a mechanics lien is recorded against a property, a Release Bond can be obtained. The amount of the release bond was been decreased from 150% of the lien amount to 125%.

Removing an Invalid Mechanics Lien – A contractor that records a mechanics lien may have up to 90 days to file a foreclosure lawsuit. Depending on the particular factual circumstances and whether a Notice of Completion was appropriately recorded, it may be less than 90 days. Failing to institute a timely foreclosure lawsuit results in the mechanics lien (or other similar remedy) becoming invalid. However, even an invalid lien may cause the property owner difficulty when it comes time for refinancing or sale.

A property owner may file a Petition to Expunge to remove an erroneous lien filed against the property. In the past, the amount of attorney’s fees that could be awarded in an action to remove the erroneous lien (a cloud on the property’s title) was capped at $2,000. With the changes in 2012, the cap no longer exists. Now the prevailing party may be awarded reasonable attorney’s fees. However, a demand must first be made by the owner instructing the contractor to remove the erroneous lien.

Notice of Completion – The time period for recording the Notice of Completion has been extended from 10 days to 15 days. Under certain circumstances, multiple Notices of Completion can now be recorded. This means that direct contractors (multiple prime contractors to the owner) have to be particularly careful with regard to when they take action to protect their interests.

The definition of Completion of a private works project has been revised to eliminate an owner “accepting” the work as an act that triggers completion. Completion of a private project now occurs upon:
1) actual completion,
2) occupation or use by the owner together with the cessation of labor,
3) cessation of labor for 60 continuous days, or 4) recordation of a notice of cessation after labor has ceased for 30 days. Completion of a public works project may still include when the public entity “accepts” the work or upon cessation of labor.

Notice of Lender – When a construction lender is involved in a project, contractual notice of the name and address of the lender must be provided to contractors and subcontractors. The owner must also provide this information to everyone that served a Preliminary Notice if the lender came onto the project after commencement.

Notice of Pendency of Action – Once a foreclosure lawsuit has been filed, a Notice of Pendency of Action must now be recorded within 20 days.

Notice of Non-Responsibility – When a tenant contracts for construction services, the owner of the property may wish to notify a contractor working on the project that it disclaims responsibility for the work. It may do so through a Notice of Non-Responsibility.

Construction Mechanic's Liens Stop Notice

Changes to Mechanics Lien laws in 2012 – Part 1

Post author By Mazzola Law Office P.C.
Post date February 28, 2013

Construction contractors have enhanced collection remedies to help them obtain payment. Two of the most commonly used remedies are mechanics liens and stop payment notices. These rights are based on the California Constitution and various statutes.

On July 1, 2012, the rules and procedures affecting mechanics liens, stop payment notices and bond claims changed (SB 189 and 190). New forms and procedures are required. A prior blog dealt with other changes to these laws that took place in 2011.

A Mechanics Lien allows a contractor to record a lien against the property that the contractor improved, giving the contractor a source from which to satisfy a judgment. A Stop Payment Notice (previously called a stop notice) enables a contractor to force an owner or a bank to set aside undisbursed construction funds held by them. Contractors are required to follow procedures to perfect their mechanics lien claim, stop payment notice rights, and bond claims, some of which are described in this blog. Failure to do so will result in waiver of those rights.

Preliminary Notice Enforcing contractor rights begins with the Preliminary Notice. The Preliminary Notice reaches backwards for 20 days and lays claim to the services, supplies, and materials provided by the contractor to the work of improvement. The Preliminary Notice form was revised in 2012 to distinguish between public and private projects.

At the start of every construction project, a contractor that does not have a direct contract with the project’s owner must serve a Preliminary Notice. This is necessary to preserve their mechanics lien claim, stop payment notice rights, and bond claims. Not only is it a required first step, failure to give a Preliminary Notice constitutes grounds for discipline under the Contractors’ State License Law.

The Preliminary Notice must be served on certain parties involved in a construction project. Failure to properly serve it will result in the loss of mechanics lien, stop payment notice, and bond rights. It is also imperative to preserve proof of compliance with the service requirements.

The rules for service of the Preliminary Notice depend on a number of factors. As one example, even when a contractor has a direct contract with the owner, the contractor must still give a preliminary notice to the construction lender. A Preliminary Notice must be served on the bond company. The service requirements for the Preliminary Notice are too variable to fully address in this summary. Consult this office for assistance.

This blog is continued in Part 2.

Indemnity and Defense

What Does Indemnity Mean? – Part 2

Post author By Mazzola Law Office P.C.
Post date January 28, 2013

Defense

Continued from Part 1.

A duty to defend another is a separate part of an indemnity provision. It requires the person giving the indemnity (the indemnitor) to pay for an attorney to defend the person receiving the indemnity (the indemnitee). A defense provision is important because of the cost of litigating a lawsuit. Sometimes the ultimate settlement of a matter is less costly than the overall expense involved in litigating the case.

The Timing of the Duty to Defend is Critical

When negotiating a defense obligation, it is important to specify when the duty arises. As the party receiving the promise to defend, the indemnitee wants the duty to defend to arise at the inception of any claim or even with the threat of litigation. The indemnitee also wants the defense to apply as broadly as possible, not just to a narrow set of circumstances. The indemnitor, on the other hand, may want the duty to defend to arise only in certain circumstances.

Inherent in an agreement to indemnify another is a statutory duty to defend the indemnitee. In order to trigger this duty, the indemnitee must tender (present) the claim or lawsuit to the indemnitor and request that the indemnitor defend the matter. Upon doing so, the indemnitor is obliged to assume the defense or contribute financially toward it under Civ. Code Section 2778(4). Crawford v. Weather Shield (2008) 44 Cal. 4th 541, 555. The Crawford case was discussed in an earlier blog here.

Concluding Thoughts

When reviewing a contract, consider each provision carefully. There is no such thing as a standard contract that cannot be improved through negotiation. Have an attorney review and explain the parts of a contract so that you understand them. Once the contract is signed, it will govern the rights and responsibilities of the parties.

With indemnity and defense, a contract should be negotiated to achieve clarity of expectations on both sides of the transaction before a dispute triggers those provisions. If you are giving the indemnity (you are the indemnitor), make sure you provide the contract to your insurance agent. Ask your insurance agent to confirm in writing that your insurance coverage complies with what the contract requires.

Indemnity and Defense

What Does Indemnity Mean? – Part 1

Post author By Mazzola Law Office P.C.
Post date January 24, 2013

Indemnity

Most contracts contain an indemnity provision. While indemnity is neither exciting nor easy to understand, recognizing how it will affect your promises and expectations is very important.

There are two major kinds of indemnity, express indemnity and implied indemnity. Express indemnity is a provision in a contract where the parties spell out who is responsible for what. Implied (or equitable) indemnity arises when there is no express indemnity provision. This blog deals with express indemnity.

Indemnity has been defined as “the obligation resting on one party to make good a loss or damage another party has incurred.” Rossmoor Sanitation v. Pylon (1975) 13 Cal. 3d 622, 628. “[T]he question whether an indemnity agreement covers a given case turns primarily on contractual interpretation, and it is the intent of the parties as expressed in the agreement that should control. When the parties knowingly bargain for the protection at issue, the protection should be afforded.” Id. at 633. The parties have great freedom to allocate responsibility in indemnity and defense provisions of their contract, as long as those arrangements do not violate public policy. E. L. White v. City of Huntington Beach (1978) 21 Cal. 3d 497, 507.

As a practical matter, when you indemnify another person in a contract, you agree to be responsible for a range of problems that arise from the contract. This can be true even if the other party caused the problem. This means that you, or your insurance company, may have to defend the other party and ultimately settle a dispute.

There are Different Kinds of Express Indemnity

Modern cases recognize that each express indemnity provision must be dealt with on a case-by-case basis according to its own facts and the language used by the parties. Rossmoor Sanitation v. Pylon (1975) 13 Cal. 3d 622, 633. However, being creatures of habit, lawyers and judges like to think of a common framework when evaluating indemnity provisions. Forty years ago, a handy three-part framework was developed in a case named MacDonald & Kruse v. San Jose Steel (1972) 29 Cal. App. 3d 413. That case referred to express indemnity classifications as Type I, II, or III.

Type I indemnity provides that the party promising (the indemnitor) to protect the other (the indemnitee) will do so ‘expressly and unequivocally’ even if the indemnitee was negligent. MacDonald & Kruse at 419. The words of a Type I indemnity agreement typically include a phrase promising indemnity regardless of the active or passive negligence of the indemnitee. Type I indemnity is no longer available in all circumstances.

Type II indemnity goes almost as far, but does not include acts of “active” negligence of the indemnitee. This means that if the indemnitee caused the problem through affirmative acts, the indemnity might not apply.

Type III indemnity is even more restrictive. It comes into effect only when the problem was caused by the fault of the indemnitor (the promising party).

In construction contracts, by law, one cannot indemnify another for their ‘sole or willful negligence.’ Additionally, there have been a number of significant changes to indemnity in construction agreements since 2009. It is important to know what is no longer ‘on the table’ when it comes to indemnity. Consult an experienced construction attorney for your particular needs.

This blog is continued in Part 2.

Labor and Employment

Employment Law Changes for 2013 – Part 2

Post author By Mazzola Law Office P.C.
Post date January 7, 2013

There are a number of important changes in the law for 2013 affecting California employers. Part 1 discusses new laws for issues ranging from religious dress to commission payments. Part 2 covers issues ranging from whistleblower protection to information that must be provided to all new hires. The items discussed here are not a full list of all changes to the law this year, nor are the points referred to comprehensive of each law, given the nature of this summary. Unless otherwise noted, these laws take effect on January 1, 2013.

New Hire Information – AB 469 affects Labor Code § 2810.5 and requires employers to provide new hires with written information before work commences. Among other things, the employee must receive information specifying their rate of pay and how it is computed, the regular paydays, the legal name (and d.b.a. name) of the employer, the physical address of the employer’s main office or principal place of business, the employer’s telephone number and the contact information for their worker’s compensation carrier. When changes occur to this information, the employer must notify its employees in writing within seven calendar days. There are a few, limited exceptions to the requirement of providing this information.

Personnel Records – AB 2674 amends Labor Code § 1198.5 and expands an employee’s rights to inspect and copy his or her personnel file. At the employee’s request, the employer must provide the employee’s personnel file or make it available within 30 days, unless there is pending litigation related to those records. There are certain exceptions of records that do not need to be provided to the employee. Employers are required to maintain personnel records for at least three years after termination of employment. Employers need only respond to one request from a former employee per year.

Private Wage Agreements – AB 2103 pertains to Labor Code § 515 and abolishes the infrequent practice of an explicit mutual wage agreement where an employer and employee agree that the payment of a fixed salary to a non-exempt employee includes all regular and any overtime hours. As a result, now all non-exempt employees must be paid for all overtime hours worked, even if they previously agreed to accept a fixed salary.

Whistleblower Protection – AB 2492 expands and modifies Government Code §§ 12650 – 12654.5 relating to California’s False Claims Act. These changes increase the protections available to employees and contractors (among others) that act as whistleblowers. Penalties and recoveries include punitive damages, interest, double back pay, and reinstatement with the same seniority status. These provisions protect whistleblowers from retaliation and provide enhanced protection relating to when the employee engages in protected conduct.

Labor and Employment

Employment Law Changes for 2013 – Part 1

Post author By Mazzola Law Office P.C.
Post date January 4, 2013

Social Media – At the top of the list is a law affecting social media policies and practices. AB 1844 added Labor Code § 980 that prohibits employers from asking employees or job applicants for their social media passwords. There is an exception that allows employers to request passwords in conjunction with certain types of workplace investigations. The Labor Code does not prohibit employers from requiring employees to provide a password for access to an employer issued electronic device.

Employers should be aware there is increased scrutiny on how employers draft and enforce social media policies. Employers should be careful not to draft overly broad policies that might restrict concerted activity or punish legitimate off-the-clock activity by employees. Many employers are unaware that the Labor Code prohibits employers from taking action against employees for lawful conduct occurring during nonworking hours away from the employer’s premises. This is an important consideration in drafting and enforcing social media policies.

Businesses should develop reasonable policies that ensure the content created by their employees for the business are clearly the property of the business. Contact this office for assistance in developing appropriate social media policies.

Commissions – AB 2675 and AB 1396 affect Labor Code § 2751 regarding commissions paid to employees in California. It requires that employers have a written commission plan setting forth the method by which commissions are computed and paid. Employees must receive the plan and sign an acknowledgement of its receipt. This change repeals Labor Code § 2752.

Paycheck Stubs – AB 1744 and SB 1255 both affect Labor Code § 226, known as the paycheck stub statute. Labor Code § 226 requires that employers provide nine categories of information on their employees’ paychecks. SB 1255 provides that failure to include the required information can result in an aggregate $4,000 penalty per employee, plus attorney’s fees and costs. The law now presumes an employee suffers an injury when the information on the paycheck stub does not allow the employee to promptly and easily determine: the amount of gross or net wages that are due, the deductions, the employer’s name and address, the employee’s name and last four digits of the employee’s social security number.

AB 1744 adds a requirement to Labor Code § 2810.5 that temporary staffing agencies provide information on the paycheck stub identifying the legal entity for which the employee is working. The changes required by AB 1744 take effect July 1, 2013.

Religious Dress and Grooming – AB 1964 adds new items to the list of protected categories under Government Code § 12940. The meaning of “religion” has been expanded to include “religious dress” and “religious grooming practices” to the categories for which discrimination is prohibited and a reasonable accommodation is required. These amendments address religious clothing, including head and face coverings, religious artifacts and jewelry, and grooming practices such as the care or maintenance of hair in observance with one’s religious creed.

Breastfeeding – AB 2386 expands Government Code § 12926 protections under the Fair Employment and Housing Act for discrimination based on sex. Specifically, this incorporates “breastfeeding” and “medical conditions related to breastfeeding” to the definition of “sex” under the law. California employers were already required to provide certain reasonable accommodations to pregnant and breastfeeding mothers under the Labor Code. This bill clarifies existing law.