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Big-name employers pay job applicants after alleged Fair Chance Act violations

Amazon, IKEA pay applicants over allegations of unfairly denying jobs

Amazon, IKEA and the Los Angeles Dodgers were among big-name employers who recently settled alleged violations of California’s Fair Chance Act.

The so-called ”Ban the Box” law, which took effect in 2018, prevents companies from asking job applicants about their criminal histories before making job offers, and from rescinding preliminary offers to such applicants without deeper consideration. It was intended to prevent unnecessary hurdles to employment.

The settlements mean the companies will pay the individuals for lost wages or other harms, as well as “take corrective action to protect against future discrimination,” the California Civil Rights Department said. 

It’s a reminder for workers of the importance of knowing and advocating for your rights.

“Nobody deserves to get locked out of the job market,” CRD Director Kevin Kish said in the settlement announcement. “These settlements are going to ensure workers and job applicants across California get the protection they are entitled to under the Fair Chance Act.”

The specifics

The allegations involve a type of employment discrimination outlined in the Fair Chance Act.

A sampling of the allegations:

  • Amazon turned down a delivery driver applicant because of a more than seven-year-old conviction.
  • IKEA denied an applicant without showing how the conviction history related to or would negatively affect duties building furniture.
  • Kohl’s denied a warehouse worker applicant after an unlawful criminal history questionnaire.
  • The Dodgers didn’t notify a guest services job applicant about why the person was denied – or allow the applicant to offer evidence challenging the decision.
  • The Citizen Hotel and MPIJet turned down applicants based on criminal histories that had been sealed, dismissed, or expunged.

The protections, and why they matter

Almost one in three adults in California have an arrest or conviction that can make it hard to find a job. The state, which has been ramping up Fair Chance Act enforcement, views the law as protecting public safety by helping these people get opportunities to support themselves and their families.

Since 2018, the CRD has reached more than 100 Fair Chance Act settlements, including one last year for more than $50,000 with Octapharma Plasma. 

The law doesn’t mean employers must hire applicants with criminal records, but it prevents businesses from outright tossing their applications without further consideration. Job advertisements also can’t include blanket statements excluding anyone who doesn’t have a clean record.

Basically, the law prevents most employers (see specifics here) with at least five workers from asking about an applicant’s criminal history before making a conditional job offer. Then, the employer must consider the nature and gravity of the offense, the time that has passed, and the nature of the job sought, among other factors. The law requires employers to show that the criminal history would directly and adversely relate to performance of job duties. 

Notably, the employer may not ask about arrests that did not result in convictions, about referrals to or participation in pretrial or posttrial diversion programs, or about convictions that have been sealed, dismissed, expunged, or statutorily eradicated.

If the employer decides to disqualify the applicant, it must notify the applicant of its preliminary decision in writing. The employer must explain the disqualifying conviction, provide a copy of the criminal history report, and tell the applicant that he or she has the right to respond within five business days. If, even after an applicant’s response, the employer turns down the applicant, the employer must provide a second written notification outlining the decision, any procedure to challenge the decision, and the applicant’s right to file a complaint with the state.

If you think that you or someone you know has faced employment discrimination, contact Keller Grover for a free, confidential consultation. We can advise you about your situation and the best steps to take. In our 30 years litigating fraud and employment cases, we have recovered billions of dollars for clients.

 

Disney employment disputes bring $276M in settlements

A pair of employment settlements by one of the most iconic employers in California demonstrates the difference workers can make when they stand up for their rights.

Disney recently agreed to a $43 million settlement related to gender pay disparities, as well as a $233 million wage theft settlement.

Both settlements stem from lawsuits originally filed in 2019. The details of the cases can be instructive for employees who feel that their rights are being violated but are unsure about what they can do about it.

Gender Pay Suit

The gender pay settlement stems from a common business practice that California has worked to stop: Use of prior compensation information to determine pay for a new employee. That practice tends to perpetuate gender-based pay disparities.

According to Forbes, LaRonda Rasmussen filed the original lawsuit, alleging that six men with the same job title received significantly more pay — including one with less experience. She later was joined by about 9,000 other women who worked or had worked for Disney.

The settlement didn’t require Disney to admit a gender discrepancy, but it did require the company to hire an outside labor economist to analyze pay equity during the next three years, as well as someone to train compensation personnel, Forbes reported.

California has sought to promote pay equity with its Equal Pay Act, which has been enhanced multiple times. The prohibition against asking about prior salaries took effect Jan. 1, 2018.

If you suspect that your employer is paying women less, contact Keller Grover for a free, confidential consultation. We advise employees about prudent next steps, and in our 30 years litigating fraud and employment cases, we have recovered billions of dollars for clients.

Wage Theft Suit

The $233 million agreement appears to be the largest wage theft settlement in state history, Voice of OC reported. 

A law that Anaheim voters approved in 2018 required all businesses that had received a city subsidy to pay workers at least $15 an hour in 2019, increasing $1/hour each year through 2022, with a cost of living raise every year thereafter. Tips or other extra pay cannot offset the wage rates, according to the law.

The settlement means underpaid employees will get all of the money they were owed, plus interest and penalties.

The state has been increasing minimum wage, bumping it up to $16.50 this year, though it’s higher in certain situations (here are details based on location and industry). As in the Anaheim situation, some localities have higher minimum wages.

Contact Keller Grover for a free, confidential consultation if you think you are being underpaid. We can advise you about your situation and what to do; in our 30 years litigating fraud and employment cases, we have recovered billions of dollars for clients.

 

New Year, New Rules: Key California Employment Law Changes in 2025

The new year will bring a series of new or clearer protections for California workers, from safeguards against intimidation and discrimination to more generous paid leave; we’re here to help you know what to watch for. Knowing your rights is the first step to guarding them. 

Here’s a rundown of some of the more noteworthy changes to California employment law that take effect in 2025:

    1. Pay: Minimum wage increases by 50 cents in January (to $16.50/hour). Health care minimum wages will increase again in July. 
  • Employer intimidation: Starting Jan. 1, employers are banned from requiring workers to attend meetings about religious or political issues, including those discouraging unionization. Employees scheduled to work during that time must be paid, whether or not they attend the meeting, and businesses must not retaliate against individuals who choose not to attend. SB 399 outlines exceptions for political, higher education and religious organizations, and employers still can hold meetings about legally required or job-related information. The penalty for violations is $500 per employee. 
  • Employer discrimination: In 2025, SB 1100 prohibits employers from requiring a driver’s license for a job unless duties specifically involve driving and an alternative would not be reasonable. SB 1137 clarifies that employers may not discriminate against workers based on any combination of protected characteristics. 
  • Paid family leave: Under prior California law, businesses could require employees to take up to two weeks of earned but unused vacation time before using paid family leave benefits to do things such as care for a very ill family member, bond with a new child, or make accommodations for active duty. AB 2123 erases that requirement as of Jan. 1.
    1. Standard communication of whistleblower rights: Employers have been required to post employee rights, including whistleblower rights. In 2025, AB 2299 will make this a standard posting, drafted by the state labor department (see the posting here), which includes the California Attorney General’s Whistleblower Hotline number. We recommend that workers thinking about taking whistleblower action contact an experienced whistleblower attorney to clearly understand their rights and prudent steps forward; we offer free, confidential consultations.
  • Freelance Worker Protection Act: The law, effective Jan. 1, outlines basic protections for freelance workers. It requires clear contracts detailing the project scope, as well as pay rate and pay method, for any work exceeding $250 over a four-month period. Also, freelancers must be paid within 30 days of work completion unless the contract says otherwise, clients cannot require freelancers to accept less than the contract amount to get a faster payment, and clients can’t retaliate against freelancers for seeking payment. Freelancers who aren’t paid are entitled to double payment plus costs and attorney’s fees.

We wish you a prosperous and protected 2025.

In more than 25 years litigating fraud and employment cases, the lawyers at Keller Grover have recovered hundreds of millions of dollars for clients and class members, and we’ve helped whistleblowers make successful reports and claim rewards. We can advocate for you. Contact us for a free, confidential consultation. 

 

Medicare Advantage Whistleblowers Could Protect the Most Vulnerable Patients: Taxpayers

Alarming patterns keep cropping up in the Medicare Advantage program, and whistleblowers could be key to protecting both patients and taxpayers.

More than half of the roughly 100 million Medicare beneficiaries choose this program, which is supposed to offer patients a health plan comparable to traditional Medicare administered by private insurance companies at less cost to the government. 

The problem: As more and more beneficiaries have elected Medicare Advantage it is proving to be more expensive than traditional Medicare. The U.S. government spent an estimated $454 billion on Medicare Advantage in 2023 with growing questions about whether those billions are going to take care of beneficiaries – or are enriching the private companies administering these plans.

A recent article in The Wall Street Journal raised the question of whether private insurers benefit from Medicare Advantage enrollees while they’re healthy but deny coverage when costly illnesses arise, prompting the patients to switch to traditional Medicare plans. Advantage plans require advance approval for many treatments and specify which doctors members can use. The fee for service model in traditional plans does not have the same prior authorization requirements.

When beneficiaries do this – and they increasingly do it when the scrutiny in the Medicare Advantage plans become an obstacle to care – it ultimately costs Medicare (and taxpayers) twice: Paying the private insurers for minimal care when patients are healthy, then paying for costly services when patients get sick and switch back to traditional Medicare.

Where do these suspicions come from?

An analysis by health policy nonprofit KFF found that Medicare spent an average of 27 percent more for people who switched from Medicare Advantage to traditional Medicare compared with those who had always been with the traditional program. That was after adjusting for differences in health status and other characteristics, and it meant an average difference of $2,585 in Medicare spending per person between the two groups.

There were multiple other findings, as well, raising similar questions.

A recent U.S. Senate subcommittee report found that private insurers are more likely to deny prior authorization for coverage of post-acute care, such as stays in skilled nursing facilities, than for other services.

“Insurance companies say that prior authorization is meant to prevent unnecessary medical services. But the Permanent Subcommittee on Investigations has obtained new data and internal documents from the largest Medicare Advantage insurers that discredit these contentions,” U.S. Sen. Richard Blumenthal (D-Connecticut), chair of the subcommittee, said in an October statement. “In fact, despite alarm and criticism in recent years about abuses and excesses, insurers have continued to deny care to vulnerable seniors—simply to make more money. Our Subcommittee even found evidence of insurers expanding this practice in recent years.”

When private companies contract with the government to administer these plans and knowingly manipulate the payment mechanisms to keep payments from the government as profits rather than paying for patient care, whistleblowers could play a key role in both protecting these patients and in preventing fraud against the federal government (and thus, taxpayers).

If you have insight into these practices and suspect fraudulent activity, contact Keller Grover for a free and confidential consultation. Our experienced whistleblower attorneys can answer questions and provide prudent next steps. Whistleblowers who help expose fraud against the federal government also are eligible for 15 percent to 30 percent of recoveries as an award.

 

No Matter the Vote Tally, California Minimum Wage is Going Up

Californians voted down a proposal to bump up the minimum wage to $18 an hour, but there still will be an increase in the New Year.

By less than 1%, California voters rejected Proposition 32, the ballot measure to raise the state minimum wage in January to $18 for large employers and to $17 for employers with 25 or fewer workers. If it had passed, the rate for those smaller employers would have jumped to $18 the following year.

As it stands, the state’s minimum wage will continue with a planned 50-cent increase to $16.50 in 2025. The figure is adjusted every year based on inflation, with increases capped at 3.5% a year (it can’t decrease).

Supporters of Proposition 32 had said the measure would have provided raises for about 2 million Californians. Analysts said the backdrop of high inflation and voters’ concerns about minimum wage increases being passed along to consumers likely contributed to the vote result.

For context, a $16.50/hour minimum wage amounts to $34,320 a year for a full-time worker.

An $18/hour minimum wage would have been $37,440, or an increase of $3,120 a year.

Washington, D.C., leads the nation with a minimum wage of $17.50, plus annual inflation-based adjustments.

But some California industries already are set for minimum wages above $18/hour:

  • In April, a $20 minimum wage took effect for most fast food workers.
  • The lowest-paid health care workers are on track to reach $25 an hour over the next several years, though the trajectory varies based on multiple factors. Their first raise came in October.  

Also noteworthy: Certain California localities have higher minimum wages. 

When the New Year arrives, minimum wage-earning workers should double-check their pay stubs for the appropriate hourly rate for their locality and industry.

Keller Grover advocates for workers, helping you better understand your rights, protections and options. In more than 25 years litigating fraud and employment cases, we have recovered hundreds of millions of dollars for clients and class members. If you’ve faced or suspect mistreatment in the workplace, contact us for a free, confidential consultation.

Other recent employment news:

  • Wingstop case shows employers will pay for wage theft, even if it’s creatively done.
  • Court favors workers in defining what counts as on the clock. 
  • Survey shows the dramatic extent of labor law violations affecting California’s hourly workers.

 

How can we take a stand for you?

Contact us now for a free and confidential case evaluation.