Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Lessons learned in the California Supreme Court on Tuesday: Workers not wanting to be fired for no reason better scour their contracts closely, and day laborers should bow in reverence to a Beverly Hills hair model. In two separate cases during oral arguments in San Francisco, the court took on unrelated employment issues that could affect millions of Californians. The justices seemed to be leaning in favor of employers in one case while smiling on employees in the other. In Dore v. Arnold Worldwide , S124494, the court appeared convinced that an at-will contract is exactly what it sounds like � an employment agreement that can be cancelled by either side without cause. And in Smith v. Superior Court( L’Oreal USA), S129476, the justices seemed to think that individuals � such as hair models and cherry pickers � hired for a select period of time, are employees entitled under state statutes to prompt payment upon completion of their work. In the first case, Brook Dore sued Arnold Worldwide Inc., a Los Angeles advertising agency, for breach of contract and other claims after he was fired 28 months into his job as a vice president and management supervisor. Dore had moved from Denver and claimed he was terminated for no reason, even though his contract, he said, implied he could only be discharged for good cause. Los Angeles County Superior Court Judge Jane Johnson granted the company summary judgment, ruling that the presumption of at-will employment codified in the state Labor Code and the express at-will provision described in a pre-employment letter to Dore precluded the finding of any implied good-cause agreement. L.A.’s Second District Court of Appeal reversed in 2004, saying there were triable issues about whether the contract was ambiguous enough to support Dore’s claim that a good-cause agreement was implied. On Tuesday, however, the Supreme Court appeared unimpressed by Dore’s argument. The justices lobbed softballs at Arnold Worldwide’s attorney, Robert Mason III, an of counsel at L.A.’s Bergman & Dacey, but hounded Dore’s lawyer, Clay Robbins III, an associate at L.A.’s Magana, Cathcart & McCarthy. Typical of the barrage faced by Robbins were the statements by Chief Justice Ronald George and Justices Joyce Kennard and Marvin Baxter that “at will” was clear-cut terminology. “The term ‘at will’ is not a very complicated term,” Baxter said. “What should the company have done to tell the employee, ‘By the way, this is at will?’” Kennard asked. “How would you have improved on this language?” Justice Carlos Moreno piped up to say that the term “at will” has “quite a legacy” in California statutes and case law. Robbins tried to argue that there was other extrinsic evidence that a judge could have looked at to determine that Dore’s position was more than an at-will job. Previous individuals in that position had been terminated for cause, he argued; the company let a major client OK Dore’s hiring; and the job was billed as a long-term situation at a family-oriented company. He was even forced to sign a no-competition clause if he left. “All these indicia,” he said, “point to something more important in the employment relationship” � a position that simply wasn’t an at-will job. “It’s the reasonable expectations presented to Mr. Dore,” he argued. “So,” Kennard said, “you’d rather we go with the reasonable expectations of the employee instead of the terms of the contract?” Justice Kathryn Mickle Werdegar joined the fray by telling Robbins that he had a difficult argument. “With your position,” she said, “almost any conceivable case could bring in extrinsic evidence that could make something that appears clear on its face ambiguous.” Mason, Arnold Worldwide’s lawyer, told the justices during rebuttal that his opponent’s position would let any employee claim he thought his contract implied he could only be fired for cause. “You literally would be opening the floodgates,” he said. In the second case, L’Oreal’s attorney, Morganstein & Jubelirer partner William Carroll, was beaten up just as badly as Robbins. The court seemed almost annoyed by Carroll’s argument that individuals who sign on for work for an agreed-upon period of time � such as a day � aren’t entitled to prompt payment. The underlying suit was filed by Amanza Smith, an aspiring actress and model who filed a class action on behalf of herself and other hair models who sometimes wait months before getting paid for their work. Smith, who worked as a saleswoman for a Beverly Hills boutique, sued after L’Oreal took more than two months to pay her the $500 she was owed for working as a hair model at a one-day hair show in 2001. L’Oreal claimed Smith was an independent contractor, not an employee within the meaning of the state Labor Code. Therefore, the company argued, she wasn’t entitled to immediate payment, and the company didn’t owe her or any other hair model so-called waiting time penalties. Los Angeles County Superior Court Judge Frances Rothschild granted summary judgment for L’Oreal, and L.A.’s Second District affirmed in 2004. On Tuesday, the Supreme Court appeared irked by Carroll’s definition of when a person has been “discharged” as an employee, rather than released as an independent contractor. Several of the justices said that Smith’s work sounded like employment from which she had been discharged at the end of the day. They were especially concerned that a ruling against Smith could subject the state’s thousands, if not millions, of day laborers � from fence builders to cherry pickers � to delayed payments. “If we hold in your favor,” Justice Ming Chin said, “then day laborers are going to have to wait three to four weeks to get paid.” Earlier, under the not-so-subtle nudging of Justice Kennard, Smith’s attorney, Kevin Ruf, of counsel in L.A.’s Glancy Binkow & Goldberg, had made the same point. “This absolutely affects every day laborer in the state of California,” he said. “Whatever the fate of a hair model working for a day will be the fate of anyone else working in a different capacity for a day.” Justice Baxter pointed out that L’Oreal’s argument would lead to the seemingly inequitable situation in which a person who quits or is fired from a job would get paid immediately, while someone who completed the work could have to wait weeks or months for compensation. “I don’t understand why the Legislature would ever want that,” he said. Said Kennard: “If we agreed with you, our decision would put in peril everyone out there who is employed for a day.” Rulings in both cases are due within 90 days.

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]

Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.