Client Update
Ronni Cuccia
Associate | Los Angeles
Heather DeBlanc
Partner | Los Angeles
Andrew Dorado
Senior Counsel | Los Angeles
Stephanie J. Lowe
Senior Counsel | San Diego
Cynthia O’Neill
Partner Emeritus | San Francisco
Juliana Perch
Associate | Los Angeles
Partner Adrianna Guzman And Associate Ronni Cuccia Convince Union To Withdraw Unfair Practice Charge.
A union filed an unfair practice charge on December 2, 2025. The union argued that the county refused to provide information it requested for bargaining on January 23, 2025, even though the union offered to sign a confidentiality agreement. The county consistently maintained the position that the information was proprietary and could not be released in any circumstance.
firm victory Labor Relations
PERB Orders 10% Pay Award Plus Interest After Employer Unilaterally Imposed Of Out-Of-Class Work.
The IBEW, Local 18, represents the water distribution employees who work for the City of Azusa Light & Power (ALP). The City assigned these employees to implement a Service Line Inventory project in response to state and federal regulations regarding the use of lead pipes in water systems. ALP management believed that the project work was within the scope of the employees’ duties.
IBEW filed an unfair practice charge with the Public Employment Relations Board (PERB). IBEW alleged that the City violated the Meyers-Milias-Brown Act (MMBA) when it assigned water employees to perform a Service Line Inventory of the City’s roughly 24,000 customer service lines, and to meet daily inspection quotas. IBEW alleged that the City changed the employees’ duties without providing IBEW adequate advance notice and opportunity to meet and confer over the decision and the effects.
An administrative law judge (ALJ) agreed with IBEW. The ALJ concluded that the City had violated its duty to bargain in good faith because the Service Line Inventory project was not within the employees’ existing job duties. The ALJ found that the project required: new and distinct
Attorneys Guzman and Cuccia drafted the county’s position statement in opposition to the charge. They argued that the charge was untimely. A charge must be filed within six months of the alleged act or of the date which the union knew or should have known of the alleged act. The charge was more than 100 days late. They also argued that the union could not reset the statute of limitations by simply reiterating its information request at a later date because the county’s position on the original request had been clear and unmistakable.
Shortly thereafter, the union withdrew the charge.
job duties; the employees to receive training; and the employees to work alone in week-long assignments to perform new, repetitive physical tasks. The ALJ ordered the City to cease and desist, post a notice that the City had violated the MMBA, and read the notice aloud (aka a spoken notice). The ALJ did not order make-whole relief or order a bargaining remedy because the project was already complete.
IBEW excepted to the ALJ’s proposed remedy and requested PERB to order make-whole relief for the employees. PERB pointed to a long line of PERB decisions that hold that if the charging party establishes a unilateral change involving extra work, then extra pay is a proper remedy as long as there is a reasonable basis for estimating the pay. PERB noted that the MOU provided 5% pay for out-of-classification work. PERB also noted that the City had previously granted two groups of employees either a salary increase or a special assignment pay in the amount of 10% for their work to install smart meters. PERB decided that the smart meter project was similar to the Service Line Inventory work and awarded 10% pay increase for the time the employees spent on the project. PERB also ordered interest on the 10% at an annual rate of seven percent, compounded daily. With this financial remedy in place, PERB found no need for the spoken notice that the ALJ had ordered.
City of Azusa (2006) PERB Dec. No. 3004-M.
PUBLIC RECORDS
Employee’s Felony Conviction Caused A Pension Forfeiture Despite Its Later Reduction To A Misdemeanor.
A former County employee pleaded guilty to a felony conflict-of-interest charge in May 2022. The Retirement Board informed him in August 2022 that under state pension law codified at Government Code section 7522.74, his felony conviction required a forfeiture of part of his pension benefits. The criminal court later reduced the felony to a misdemeanor under Penal Code section 17(b)(3). The former employee asked the pension board to reinstate his benefits.
The County Retirement Board denied his request, and the trial court upheld that denial. The California Court of Appeal addressed whether a public employee is “convicted” under Government Code section 7522.74 when guilt is adjudicated (by plea), or only when a judgment is entered, and the effect of a subsequent reduction to a misdemeanor.
The Court agreed with published precedent that a guilty plea to a felony constitutes a “conviction” for purposes of the pension forfeiture statute, and that the subsequent reduction to a misdemeanor did not undo the earlier conviction for pension purposes. The Court noted that the forfeiture law only identifies one circumstance when pension benefits can be returned-- when the conviction is reversed. Thus, the former employee could not receive his forfeited pension benefits. Under the Public Employees’ Pension Reform Act, statutory felony pension forfeiture is triggered by the adjudication of guilt, and subsequent reductions of the underlying charge do not restore forfeited benefits.
Bishop v. San Diego County Employees Retirement Association (2026) Cal.App.LEXIS 106.
Restraining Orders
Restraining Order Granted Against Father Whose Son Had Made Credible Threats Of Violence.
The Anaheim Police Department (APD) sought the Gun Violence Restraining Order under Penal Code section 18175 (GVRO) after John Adams Crockett Jr.’s adult son, Tyler Crockett, who lived with him, made credible threats of a mass shooting at Savanna High School in Anaheim. Tyler had a documented history of multiple mental health holds and was subject to a lifetime prohibition on possessing firearms. After sending text messages threatening to “shoot up” the school and referencing his access to large quantities of ammunition, the APD obtained a GVRO against John Adams Crockett, who owned numerous firearms and thousands of rounds of ammunition.
At the evidentiary hearing, the trial court found the requisite clear and convincing evidence that John Adams Crockett failed to adequately secure his firearms from his son, Tyler, and that Tyler posed a significant danger of carrying out gun violence. The court determined that John Adams Crockett’s conduct to allow Tyler access to firearms, despite Tyler’s lifetime prohibition and mental health history, created a substantial risk of personal injury to others. The trial court issued a three-year GVRO, and Crockett appealed.
In the California Court of Appeal, John Adams Crockett argued there was insufficient evidence to support the GVRO, and he challenged Penal Code section 18175 on several grounds, including vagueness, overbreadth, and violation of his Second Amendment rights. The Court rejected these arguments and affirmed the order.
The Court emphasized that section 18175 is preventative and forward-looking, and that a person may “cause” a danger of injury under this law by giving another person, who poses a credible threat, access to firearms. The Court further held that the law was sufficiently clear and that Crockett forfeited several claims by failing to raise them in the trial court.
Anaheim Police Dept. v. Crockett (2026) CalApp.LEXIS 101.
Note:
LCW attorneys regularly win Workplace Violence Restraining Orders on behalf of employers who need to protect employees. The law governing Workplace Violence Restraining Orders is Code of Civil Procedure section 527.8. Similar to Penal Code section 18175, an employer must show a credible threat of violence by clear and convincing evidence to receive the Workplace Violence Restraining Order.
Consortium Call Of The Month
Members of Liebert Cassidy Whitmore’s employment relations consortiums may speak directly to an LCW attorney free of charge regarding questions that are not related to ongoing legal matters that LCW is handling for the agency, or that do not require in-depth research, document review, or written opinions. Consortium call questions run the gamut of topics, from leaves of absence to employment applications, disciplinary concerns and more. This feature describes an interesting consortium call and how the question was answered. We will protect the confidentiality of client communications with LCW attorneys by changing or omitting details.
Answer:
Question:
Can an employer retroactively designate an employee’s leave as California Pregnancy Disability Leave (PDL)?
Yes, if the underlying reason for the leave starting in December was pregnancy-related disability, the employer may and should correct the leave coding so the leave is treated as PDL effective the date the employee’s pregnancy disability began. PDL applies when an employee is “disabled by pregnancy, childbirth, or a related medical condition,” and entitles the employee to a reasonable period of leave not to exceed four months. (California Government Code section 12945).
Did You Know?
Whether
you are looking to impress your colleagues or just want to learn more about the law, LCW has your back! Use and share these fun legal facts about various topics in labor and employment law.
• A voluntary early retirement incentive plan may conflict with the purpose of the Age Discrimination in Employment Act (ADEA) if it arbitrarily reduces or ends benefits based solely on an employee’s age. One solution can be to tie the incentive to an employee’s years of service. For example, an early retirement plan that offers employees age 50 or older with at least five years of service a one-time payment of 5% of salary for each year of service—up to 100%—is likely permissible. This is because the benefit is tied to years of service rather than age alone.
• The U.S. Department of Labor moved on February 27, 2026, to replace the independent contractor test under the Fair Labor Standards Act (FLSA). The current rule tended to tip the scales in favor of employee status. The new proposed rule is favored by business groups and focuses on the amount of control an employer has over workers. The proposed rule is now in its 60-day comment period.
benefits corner
Beyond Processing Payroll: Managing Retirement Benefit Administration Risk.
While defined benefit pensions may be administered through CalPERS, CalSTRS, or a county retirement system established under the County Employees Retirement Law of 1937 (external public retirement system), public agencies still retain significant responsibility for how retirement benefits are implemented and administered at the employer level. Auditors, governing boards, and even employee
representatives increasingly expect agencies to be able to produce written evidence of how retirement benefit decisions are reviewed and monitored.
Agencies participating in an external public retirement system may understandably view pension oversight as primarily the responsibility of the retirement system. However, any agency that sponsors a 457(b), 401(a), 403(b), OPEB, or other supplemental arrangement retains direct governance responsibility. In addition, employerlevel processes such as contribution reporting, eligibility determinations, and payroll coordination remain within the agency’s control.
The practical risk for most agencies does not arise from investment selection within an external public retirement system. It arises from how accurately and consistently the agency executes its administrative responsibilities. Contribution timing, payroll reporting accuracy, eligibility determinations, and coordination with plan vendors are the areas where issues most often occur. Those issues, not market performance, typically drive audit findings, corrective action requirements, and employee disputes.
Recent litigation and audit trends underscore a consistent theme: when retirement benefit decisions or practices are questioned, the focus is on the agency’s process. The issue is not whether an outcome later appears imperfect, but whether the agency can demonstrate that it followed a structured, documented approach to oversight and administration. Agencies are better positioned when they can produce written evidence of regular review, clearly defined responsibilities, and consistent monitoring of vendors and internal processes. They are more vulnerable when decisions are informal, undocumented, or handled on an ad hoc basis.
A structured approach focuses on several core administrative controls.
Contribution Timing Matters.
Employee contributions should be transmitted promptly and in accordance with plan terms. Clear written procedures, defined internal timelines, and periodic validation of remittance practices help ensure compliance and reduce audit exposure. Payroll should confirm that its processes align with the governing plan document and any applicable vendor agreements.
System Alignment Matters.
Payroll configuration should be periodically reviewed to ensure eligibility rules, contribution limits, and formulas remain consistent with governing plan documents. Regular reconciliation between system settings and plan terms is a straightforward but important internal control.
Fee oversight Matters.
Agencies should periodically assess recordkeeping fees, understand compensation structures, and document how service providers and investment options are evaluated. Clear documentation of these reviews demonstrates that fees and service provider performance are monitored on a consistent basis.
Committee Process Matters.
Participation in a public defined benefit retirement system may limit the agency’s role in pension investment decisions, but agencies that sponsor 457(b), 401(a), 403(b), OPEB, or other supplemental arrangements retain direct governance responsibility for those programs. Where a retirement plan committee or similar body is established, it should operate under a clear charter with defined responsibilities and regular meetings. Meeting materials and minutes should reflect a substantive review of fees, service providers, and administrative practices. Written records of these discussions allow the agency to demonstrate that oversight responsibilities are being exercised in a consistent and disciplined manner.
Operational Error Correction Matters.
Even with strong controls, administrative errors can occur. Agencies should maintain a defined process for identifying, documenting, and correcting issues in a timely and consistent manner. Written procedures and clear records of corrective actions help demonstrate that issues are addressed systematically and in accordance with plan terms, protecting both the agency and its employees.
A structured internal review should confirm that the following elements are in place and functioning as intended.
• Clear identification of the plan administrator and any delegated responsibilities;
• A current committee charter, if applicable, and meeting minutes reflecting substantive review;
• Documentation of periodic fee assessment and service provider evaluation;
• Written payroll procedures governing contribution processing and remittance timing;
• Ongoing alignment between payroll systems and plan documents; and
• A defined and documented process for handling participant inquiries and administrative corrections.
Where documentation or procedures have not been reviewed recently, a structured governance assessment can help ensure roles, controls, and vendor oversight remain aligned. Periodic review and targeted staff training strengthen internal controls and reduce the likelihood of audit findings or participant disputes.
The objective is not to eliminate every risk. It is to ensure that retirement benefit administration is intentional, structured, and consistently documented. When an audit occurs or a participant raises a concern, clear documentation of oversight activities, defined roles, and internal controls becomes the primary evidence that the agency fulfilled its responsibilities.
Voluntary Employer Pick-Up Contributions For State Disability Insurance Are Taxable In 2026.
Any public agencies that have opted to participate in California’s State Disability Insurance (SDI) program and that voluntarily pick up any part of an employee’s SDI contribution will be required to treat such employer contributions as gross income and wages for federal employment tax purposes.
SDI provides partial compensation for wage loss sustained by an employee who is unable to work due to their own illness or injury, or for paid family leave reasons. SDI is generally funded through employee contributions, with no required employer contributions. Most public agencies are exempt from providing SDI to employees. (Unemp. Ins. Code, section 2606.) The only public agency employees who are subject to SDI are district hospital employees, public housing administration agency employees, certain state employees, and employees of public agencies that have elected SDI coverage. As such, some public agencies participate in SDI because they have elected coverage for all or select groups of employees.
On January 15, 2025, the IRS released Notice 2025-4, which guided the tax treatment of contributions and benefits paid in certain situations under a state’s paid family and medical leave programs. Most of Notice 2025-4 focused on how the state and employers should tax state-mandated employer contributions to such programs. However, California’s SDI program only requires employee contributions and does not mandate employer contributions. The applicable part of Notice 2025-4 is where it addresses how to tax an employer’s voluntary pick up of an employee’s otherwise required SDI contribution. Notice 2025-4 provided that employers that voluntarily pay any part of the SDI contribution on behalf of employees must treat the contribution as gross income and wages for federal employment tax purposes. IRS Notice 2025-4 initially provided that calendar year 2025 would be a transition period for purposes of IRS enforcement and administration.
The IRS recently released Notice 2026-6, which clarified that the transition period for employer pick-up contributions ended in 2025. Thus, beginning this year in 2026, public agencies that have opted into SDI and who either voluntarily or through negotiated agreement (e.g., memorandum of understanding or other contract) pick up and pay for any portion of an employee’s SDI contribution must include such contribution as gross income and wages for federal employment tax purposes. While Notice 2026-6 extended transition relief for other types of contributions, it made clear that there is no more transition relief for pick-up contributions. Any public agency that is picking up employees’ SDI contributions must report such contributions as taxable beginning in 2026.
Benefits Compliance Question
Question:
Can an employer provide employees with a cash refund of their unused transportation benefits after the end of the plan year?
Answer:
Unfortunately, no. There are limited ways in which unused transportation benefits may be used. When an employee makes pre-tax payroll deductions for an employer-provided transportation benefit, the funds may only be disbursed to the employee for reimbursement of qualified transportation expenses under Sections 132(a)(5) and 132(f) of the Internal Revenue Code.
In IRS Information Letter 2012-0027 (December 30, 2021), the IRS provided the following guidance on what employees and employers could and could not do with unused transportation benefits. The letter states that an employee cannot “cash out” unused transportation benefits. The IRS made clear that once an employee has agreed to reduce their compensation on a pre-tax basis to pay for qualified transportation fringe benefits, the employee cannot receive that compensation as a “cash refund” at any point. Instead, the employee is only entitled to receive nontaxable qualified transportation fringe benefits.
Despite the no-cash-out rule, employees do have some flexibility when it comes to when they can use the transportation benefits. The IRS Information letter states that there is no “use-it-or-lose-it” rule for transportation benefits. The IRS allows employees to carry over unused benefits from month-to-month. Other IRS guidance has provided that transportation benefits may carry over to plan years and never expire while an employee remains actively employed. (Treasury Regulation 1.132-9(b), Q&A 15; IRS Information Letter 2024-0004.)
LCW BENEFITS BEST PRACTICES TIMELINE
Each month, LCW presents a monthly benefits timeline of best practices.
March:
• Furnish Form 1095-C to each full-time employee by Monday, March 2, 2026, for the 2025 calendar year. Retain a record of your agency furnishing the forms to employees. See LCW’s Special Bulletin regarding an optional exception where employers may skip furnishing Form 1095-C and the complexities with using the exception. Also, ensure that vendors who conduct filings are doing so correctly, as the agency will ultimately be responsible for errors.
• E-file Forms 1094-C and 1095-C by Tuesday, March 31, 2026. Retain a record of the forms and proof of the e-filing. To the extent a vendor performs these filings on behalf of the agency, the agency should secure copies of the filings from the vendor. In the event of a potential future assessment, the agency will need to see the details of exactly what was filed.
• If the agency would like an automatic 30-day extension to file Forms 1094-C and 1095-C, the agency must submit Form 8809 on or before the due date of the returns.
• If the agency administers the maximum grace period for health FSAs or DCAPs, the period ends March 15 for plan years that ended December 31, 2025.
New Leadership Appointments!
Liebert Cassidy Whitmore is pleased to announce new leadership appointments across three of its offices.
Alysha Stein-Manes will serve as Co-Managing Partner of the Los Angeles office. Gage Dungy and Michael Youril have been named Office Managing Partners of the Sacramento and Fresno offices, respectively.
In their new roles, Alysha, Gage, and Michael will advance LCW’s strategic growth, strengthen client relationships, and support the continued development of attorneys and staff across the firm.
Labor Relations
Certification Program
Developing Positive Partnerships and Leadership Excellence for Labor Relations Professionals
The use of this official seal confirms that this Activity has met HR Certification Institute’s® (HRCI®) criteria for recertification credit pre-approval.
2026 VIRTUAL CLASSES
All seven workshops include both traditional training and interactive simulations to develop skills helpful to labor relations professionals.
LCW 2026 Pre-Conference 21 January COSTING LABOR CONTRACTS
*In-Person event: San Francisco
12 & 19 February NUTS & BOLTS OF NEGOTIATIONS
12 & 19 March RULES OF ENGAGEMENT
16 & 23 April BARGAINING OVER BENEFITS
07 & 14 May PERB ACADEMY
04 & 11 June TRENDS & TOPICS AT THE TABLE
Interested?
Start Earning Your Certificate at: https://cvent.me/qWm1W9
16 & 23 July COMMUNICATION COUNTS!
13 & 20 August RULES OF ENGAGEMENT
17 & 24 September NUTS & BOLTS OF NEGOTIATIONS
15 & 22 October PERB ACADEMY
03 & 10 December BARGAINING OVER BENEFITS
*Each class consists of two dates/parts. Participation in both dates/parts is required for certification.
*Participants in the LRCP program have a three-year timeframe to complete all seven classes.
Liebert Cassidy Whitmore