In California, the New Year means new laws and regulations for California employers. Below we summarize new legislation that will affect employers doing business in California beginning January 1, 2014, unless otherwise noted.
Wage and Hour Laws, Penalties, and Awards
Minimum Wage Increase
(AB 10 Alejo)
This bill raises California's minimum wage over the course of two years: from the current rate of $8.00 per hour to $9.00 per hour on July 1, 2014, and then to $10.00 per hour on January 1, 2016.
Overtime for Domestic Workers
(AB 241 Ammiano)
This bill requires employers to pay their domestic employees overtime at a rate equal to time and a half for each hour worked beyond nine hours in a workday or 45 hours in a workweek. This overtime requirement applies to all employees engaged in "domestic work," including childcare providers, caregivers of people with disabilities, sick, convalescing, or elderly persons, house cleaners, housekeepers, maids, and other household occupations, but not to individuals who work for convalescent or residential care facilities for the elderly.
Liquidated Damages for Payment of Less than Minimum Wage
(AB 442 Nazarian)
Existing law subjects an employer who pays an employee less than minimum wage to a citation that includes a civil penalty and restitution of wages. This bill expands the citation to include liquidated damages.
Wage Exemptions for Employers of Minors in Artistic Employment Contracts
(AB 533 Calderon)
This bill exempts employers of minors under contracts for artistic employment for services as an extra, background performer, or in a similar capacity (including actors, dancers, musicians, comedians, singers, stunt-persons, voice-over artists, or sports players) from a requirement that the employer set aside 15% of the minor's gross earnings in trust for the benefit of the minor.
Civil Penalties for Garment Manufacturers
(AB 1384 Committee on Labor and Employment)
Existing law requires garment manufacturers to display his or her name, address, and garment manufacturing registration number on the front entrance of his or her business. This bill now subjects an employer to a civil penalty, which may be contested by following Labor Code section 2681 procedures, in the amount of $100 for an initial violation and $200 for each subsequent violation for each calendar day.
Creation of Lien on Final Orders with Labor Commissioner
(AB 1386 Hernandez, Alejo, Chau, and Holden)
Existing law requires the Labor Commissioner to file an order, decision, or award within 15 days of hearing an employee complaint, and then file the final order with the superior court clerk to enter judgment within 10 days of the order. This bill provides for the creation of a lien after judgment, which may be recorded by the Labor Commissioner. The lien would continue on the employer's real property until satisfied or released or for 10 years.
Increased Bond Requirement for Employers of Car Washes
(AB 1387 Hernandez)
Existing law requires employers of car washes to post a $15,000 bond for the benefit of the state to compensate employees damaged by the employer's nonpayment of wages. This bill raises the employer's bond requirement amount to $150,000, but exempts an employer from that requirement if the employer has a collective bargaining agreement in place that expressly provides for wages, hours of work, working conditions, and expeditious process to resolve disputes concerning nonpayment of wages.
One Hour of Additional Pay for Failure to Provide Recovery Periods
(SB 435 Padilla)
Existing law authorizes the California Labor Commissioner to recover one additional hour of pay at the employee's regular rate of compensation for each workday that an employer fails to provide a rest or meal period under the state Wage Orders. This bill allows the Labor Commissioner to recover the same amount if the employer fails to provide a "recovery period," which is defined as a cool down period afforded an employee to prevent heat illness. This does not apply to employees exempt from meal and rest period requirements.
Attorneys' Fees for Prevailing Employer Only in Bad Faith Actions
(SB 462 Monning)
Existing law permits an employer who prevails on an action involving nonpayment of wages, fringe benefits, or health and welfare or pension fund contributions to recover attorneys' fees and costs if the employer requested those fees and costs at the initiation of the action. This bill now provides that attorney's fees and costs are only recoverable by a prevailing employer if a court finds that the employee brought the action in bad faith.
Failure to Remit Employee Wage Withholdings
(SB 390 Wright)
It is presently a crime under Labor Code section 227 for an employer to fail to make certain payments to health and welfare funds, pension funds or various benefit plans. Violations exceeding $500 are deemed a felony; violations less than $500 are a misdemeanor. This new law amends the Labor Code to state that it is also a violation for employers to fail to remit payroll taxes or other withholdings that are required pursuant to federal, state, or local laws. The Labor Commissioner may pursue criminal misdemeanor prosecution against employers who fail to remit payroll taxes. The law stems from a concern that employers were withholding taxes, but then failing to remit those taxes to the government agency.
San Francisco's New Family Friendly Workplace Ordinance
(San Francisco Administrative Code Chapter 12Z)
We previously discussed this San Francisco ordinance in an earlier article. This new law applies to employers with 20 or more employees. Under the new ordinance, employees who have worked with an employer for at least six months and work at least eight hours a week may submit a request in writing for a "flexible or predictable working arrangement" to assist with certain caregiver responsibilities. In particular, the employee may seek a "flexible working arrangement" (defined as changes in the terms and conditions of the employment that provide the employee flexibility to assist with caregiver responsibilities for a child, family member with a serious health condition, or a parent at least 65 years old). Examples of a flexible working arrangement include a job sharing arrangement, reduction in work duties, modified work schedule, and telecommuting. A "predictable work arrangement" is a change that allows scheduling predictability to assist with caregiving responsibilities. An employee can request these arrangements twice every 12 months and more than twice if there is a major life event, such as a birth/adoption of a child or an increase in caregiving responsibilities. Employers must follow specific procedures, including meeting with the employee and providing any bona fide reason for denying the requested change. There are also notice requirements. For more information about the specific and technical requirements stemming from the ordinance, see our earlier discussion.
Employment Discrimination and Retaliation
FEHA Protections for Military Veterans
(AB 556 Salas)
Existing law - the FEHA - protects and safeguards the right and opportunity of all persons to seek, obtain, and hold employment without discrimination or abridgment on account of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, or sexual orientation.
This bill adds "military and veteran status" to the list of categories already protected from employment discrimination under the FEHA, and provides an exemption for an inquiry by an employer regarding military or veteran status for the purpose of awarding a veteran's preference as permitted by law.
Sexual Harassment Need Not Be Motivated By Sexual Desire
(SB 292 Corbett)
This bill clarifies existing law that sexually harassing conduct need not be motivated by sexual desire in order to violate California's harassment and discrimination laws. This amendment was in response to a California Court of Appeal decision in 2011 in which the court dismissed a same-sex harassment action when the employee was unable to show that his supervisor was sexually interested in him. Sexual harassment is unlawful even if the harasser has no desire to engage in a sexual relationship with the employee.
Accommodations for Victims of Domestic Violence, Stalking, and Sexual Assault
(SB 400 Jackson)
Existing law permits employees who are victims of sexual assault and domestic violence to take time off from work without adverse consequences in order to attend to issues arising as a result of domestic violence or sexual assault. This bill extends these provisions to victims of stalking. Employers cannot discriminate or retaliate against stalking, domestic violence or sexual assault victims when the victim provides notice to the employer or the employer has actual knowledge of the employee's victim status. Another change is that the employer must engage in a good faith interactive process to identify potential reasonable accommodations for stalking, domestic violence, or sexual assault victims. In conducting this interactive process, an employer may require the employee submit a written statement certifying that the accommodation is related to the employee's victim status. Lastly, employers must now provide reasonable accommodations for these victims, which may include implementing safety measures or procedures like a transfer to work in another location, a modified work schedule, installation of safety locks, or assistance in documenting the employee's status for legal proceedings. Employers are not required to provide an accommodation that would create an undue hardship, including an action that violates an employer's general duty to maintain a safe workplace for all employees.
(SB 496 Wright)
Labor Code section 1102.5 currently provides that employers cannot take an adverse action against an employee who reports an actual or suspected violation of a law to a government agency. Case law holds that an employee whose duties include disclosure of legal compliance information is not a "whistleblower" under the statute. The new law expands the whistleblower protections in Labor Code section 1102.5 by overturning the case law that exempted employees from protection who have legal compliance duties from being a whistleblower and offering additional protections for internal whistleblowers. Based on the changes effective January 1, 2014, an employer cannot adopt any rule or policy that prevents an employee from disclosing a reasonable belief of a legal violation to a supervisor or an employee who has the authority to investigate or correct the violation. Further, an employer cannot retaliate against an employee because the employer believes that the employee disclosed or may disclose a violation to a government or law enforcement agency, or to a supervisor or another employee who has the authority to investigate, discover or correct the violation. This protection applies when the employee has reasonable cause to believe that the information discloses a violation of law or regulation, even if disclosing the information is part of the employee's job duties. Lastly, the new law prohibits an employer from taking particular actions, including retaliation, that are designed to prevent an employee from providing information to, or testifying before, any public body conducting an investigation or hearing.
Unfair Immigration-Related Practices and Protections against Retaliation
(AB 263 Hernandez)
Unfair Immigration-Related Practices:
Existing law prohibits an inquiry into a person's immigration status for purposes of enforcing state labor and employment laws, unless a showing is made, by clear and convincing evidence that the inquiry is necessary in order to comply with federal immigration law. This bill:
• Prohibits an employer from engaging in an unfair immigration-related practice for the purpose of retaliating against any person that exercises any rights under the Labor Code or local ordinance,
• Defines "unfair immigration-related practice" as: (1) requesting more or different documents required under 8 U.S.C. § 1324a(b) or a refusal to honor documents tendered pursuant to that section that on their face reasonably appear to be genuine; (2) using the federal E-Verify system to check the employment authorization status of a person at a time or in a manner not required under 8 U.S.C. § 1324a(b), or not authorized under any memorandum of understanding governing the use of the federal E-Verify system; (3) threatening to file or the filing of a false police report; or (4) threatening to contact or contacting immigration authorities, and
• Creates a rebuttable presumption that an employer has engaged in an unfair immigration-related practice when such actions occur within ninety days of the employee's exercise of a right protected by the Labor Code or a local ordinance applicable to employees.
Existing law prohibits an employer from discharging or discriminating against any employee or applicant for employment because the employee or applicant engaged in protected conduct. Similar to SB 666, this bill also:
• Prohibits an employer from retaliating against an employee who provides information to, or testifies before, any public body conducting an investigation, hearing, or inquiry,
• Permits an employee to make a written or oral complaint that the employee is owed unpaid wages,
• Provides for civil penalties up to $10,000 per employee, and requires the court to order the suspension of government licenses issued to the employer, and
• Provides that an employee need not exhaust administrative remedies or procedures to enforce Labor Code section 98.7
Prohibition on Requesting Information on Judicially Dismissed or Sealed Convictions
(SB 530 Wright)
Currently, an employer cannot ask a job applicant to disclose information concerning an arrest or detention that did not result in a conviction, or information concerning a referral to, and participation in, any pretrial or post trial diversion program. This new law amends Labor Code section 432.7 to prohibit an employer from asking an applicant to disclose, or from utilizing as a factor in determining any condition of employment, information concerning a conviction that has been judicially dismissed or ordered sealed. Exceptions to this amendment include if: (1) the employer is required by law to obtain information regarding conviction of an applicant; (2) the applicant would be required to possess or use a firearm in the course of his or her employment; (3) the applicant is prohibited by law from holding the position, regardless of whether the conviction has been expunged, judicially ordered sealed, statutorily eradicated, or judicially dismissed following probation; and, (4) the employer is prohibited by law from hiring an applicant who has been convicted of a crime.
Expansions to Paid Family Leave Law
(SB 770 Jackson)
Workers who need time off from work to care for a seriously ill child, spouse, parent, domestic partner, or to bond with a minor child within one year of the birth of a child or placement of a child in connection with foster care or adoption currently receive up to six weeks of wage replacement benefits from the state of California. Beginning on July 1, 2014, the family temporary disability program will expand to include time off to care for a seriously ill grandparent, grandchild, sibling or parent-in-law. The law does not grant an employee new grounds for leave from work. This state program found at Insurance Code section 3301 is funded by additional worker contributions to the Unemployment Compensation Disability Fund.
Protections and Unpaid Time Off for Victims of Serious Crimes
(SB 288 Leiu)
An amendment to Labor Code section 230.5 enlarges the types of crimes for which an employee, who is a victim of such crimes, may seek unpaid leave from work to appear in court. Current law provides that employers with 25 or more employees cannot discriminate or retaliate against an employee who is a victim of a serious crime for taking time off to appear in court, or an employee who is a domestic violence or sexual assault victim for taking time off to seek relief. This new law adds to the list of crimes for which an employee may seek leave if he or she is a victim. In total, an employer may not discriminate, retaliate, and shall grant leave for an employee to be heard in legal proceedings when that employee is a victim of vehicular manslaughter, felony child abuse, assault resulting in the death of a child under eight, felony domestic violence, felony physical abuse of an elder, felony stalking, solicitation for murder, hit-and-run, felony DUI, and sexual assault.
'Tis the season for California employers to review and revise their policies and procedures!