Why You May Not Want To Be A "Guiding Spirit"

• Published date: 26 July 2022
• Subject Matter: Employment and HR, Employee Benefits & Compensation
• Law Firm: Allen Matkins Leck Gamble Mallory & Natsis LLP
• Author: Mr Keith P. Bishop

Last week, I wrote about California Labor Code ' 558.1 which provides that an owner, director, officer, or managing agent of an employer (a "person acting on behalf of an employer") may be liable "as the employer" for violating, or causing to be violated, any provision regulating minimum wages or hours and days of work in any order of the Industrial Welfare Commission, or violating, or causing to be violated, Sections 203, 226, 226.7, 1193.6, 1194, or 2802 of the Labor Code.

Presumably, these violations must relate to employment in California. But what if the owner, director, officer, or managing agent of the employer is not in California? According to U.S. District Court Judge Dolly M. Gee, "just because an individual's job title may open him up to potential liability under a California statute in the abstract does not mean that, without any minimum contacts, he is subject to California courts' personal jurisdiction". Duong v. Groundhog Enterprises, Inc., No. 2020 WL 2046397, at *3 (C.D. Cal. Feb. 7, 2020). According to Judge Gee, "Courts may...