Lewings v. Chipotle: No Private Right of Action under Workers’ Comp Laws for Non-Slip Shoes, But PAGA and UCL Claims Remain

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Many employers require their employees to wear slip-resistant shoes to maximize safety in the workplace. While some employers fully cover or subsidize the cost of slip-resistant shoes, others pass their entire cost onto employees. In the past, plaintiff’s attorneys have sought to recover the cost of these shoes incurred by employees by bringing claims for unreimbursed business expenses. However, where the shoes are not considered a uniform (because they are not of a distinctive design or color and generally can be used at another job), employers are not required to pay for the cost of requiring employees to wear non-slip shoes. See generally Lemus v. Denny’s Inc., 2015 U.S. App. LEXIS 10284 (9th Cir. June 18, 2015) (unpublished). Plaintiff’s attorneys have also brought employee claims for unlawful deductions under Labor Code sections 221 and 224, where the employer deducts the cost of non-slip shoes from employee paychecks. Many of these claims have not gained traction in the class action context, due to some courts finding that common issues do not predominate because determining whether written authorization was obtained prior to making deductions for the shoes necessitated individualized inquiries or because courts found that the employer had obtained written employee authorizations. See Munoz v. Chipotle Mexican Grill, Inc., 238 Cal. App. 4th 291, 302-304 (1st Dist. Div. 5 Oct. 15, 2015), Lemus at *4-5.

However, in a recent case, the plaintiffs used a different legal theory to recoup the cost of the non-slip shoes, under Labor Code sections 3751 and 3752. Labor Code section 3751 subsection (a) provides that “[n]o employer shall exact or receive from any employee any contribution, or make or take any deduction from the earnings of any employee, either directly or indirectly, to cover the whole or any part of the cost of compensation under this division.” In other words, section 3751 prohibits employers from receiving contributions to workers’ compensation insurance plans.

In Lewings v. Chipotle, the plaintiff alleged that Chipotle violated Labor Code section 3751 by requiring employees to purchase slip-resistant shoes through a third-party seller, Shoes for Crews, because Shoes for Crews extended warranties to Chipotle for slip-and-fall-related workplace injuries. On July 1, 2015, in an unpublished decision, the California Court of Appeal reversed a trial court order dismissing the plaintiff’s class action case after finding Chipotle did violate section 3751. Lewings v. Chipotle Mexican Grill, Inc., No. B255443, 2015 Cal. App. Unpub. LEXIS 4673 (2nd Dist. Div. 2 July 1, 2015) (slip op. available here). The appellate court held that warranties were considered compensation under the statute because the warranties either directly covered the cost of compensation by paying medical expenses for work-related injuries or indirectly covered the cost of compensation by preventing increases in workers’ compensation insurance. Slip op. at 5. As such, the appellate court found Chipotle had violated section 3751 because its employees were contributing, whether voluntarily or involuntarily, to the cost of Chipotle’s workers’ compensation insurance. Id. at 4-7.

After the decision, it seemed that employers would now be at risk to the extent that they received warranties or other types of contributions toward the cost of workers’ compensation that were in part, funded by employees. Then, on rehearing, the appellate court reversed a portion of its decision reviving the plaintiff’s first cause of action under section 3751, though it left much of its prior decision intact. Lewings v. Chipotle Mexican Grill, Inc., No. B255443, 2015 Cal. App. Unpub. LEXIS 6770 (2nd Dist. Div. 2 Sept. 22, 2015) (slip op. available here). Specifically, after finding a violation of section 3751 had been sufficiently alleged, the court then held that section 3751 does not provide for a private right of action because neither the statute nor the legislative history clearly indicated a private right of action was intended. Slip op. at 9-10. It is not clear from the opinion whether legislative history was considered, as neither party submitted briefing on the legislative intent of section 3751. See id. However, despite the lack of a private right of action in section 3751, the court still found a violation of the statute had been sufficiently alleged, allowing the plaintiff’s claim for Business & Professions Code section 17200 (UCL) to proceed. Id. at 11. Furthermore, although section 3751 is not actionable under PAGA, the court indicated that the violations plaintiff alleged under sections 201, 202, and 226(a) were sufficient to state a claim under PAGA, because the violations were not “purely derivative” of section 3751 and were “factually distinguishable” from a section 3751 violation. Id. at 14. Additionally, the standalone claims for violations of sections 201, 202, and 226(a) were also held to be sufficiently alleged. Id. at 10-13.

As such, although Labor Code sections 3751 and 3752 do not necessarily offer a new avenue of claims when it comes to the battle over employer programs mandating slip-resistant shoes, a violation of the UCL premised on those sections is still a viable cause of action and claims for other sections of the Labor Code, such as 201 and 202, including under PAGA, can be derived from violations of 3751.

Authored by: 
Jamie Greene, Associate