The latest XpertHR podcast features an in-depth look at several new employment law developments out of California, perhaps the most pro-employee state in the nation. Littler Mendelson partner Chris Cobey takes listeners through a range of topics, and discusses how they are affecting employers.
Cobey, who practices with the firm's San Jose office, highlights a law involving personnel files as one of which HR needs to be most aware. He explained that the California statutes have expanded in 2013 to increase penalties and set deadlines for employers to respond to requests for certain portions of employee personnel files. Violators, Cobey noted, can be subject to penalties of hundreds of dollars.
"Another area in which California employers have got to toe the line are written commission agreements," said Cobey. "A lot of people will mistake bonuses for commissions." As a result, he advises that if employees are covered by commission payments arising from the sale of a product (as opposed to making a product or rendering a service) California employers must have a written agreement in place.
Big News From the California Supreme Court
The California Supreme Court handed down a major ruling in February 2013 in a mixed-motive discrimination case, meaning the employer may have had both a legitimate and an illegitimate reason for taking the action that it did. In Harris v. City of Santa Monica, a probationary bus driver city employee had a pair of accidents as well as a couple of absences. 2013 Cal. LEXIS 941.
The employee volunteered to her boss that she was pregnant on the same day that the boss looked at her record and decided she would not make it through the probationary period. As a result, the city terminated her. The California High Court held that the employer's act violates the law if "the protected characteristic was a substantial motivating factor" in the decision.
Cobey said the opinion actually has helpful elements for employers. For instance, the Court noted that "stray remarks in the workplace" by nondecision-makers, as well as statements by decision-makers unrelated to the decision-making process itself, cannot by themselves establish that an improper bias was a "substantial motivating factor." According to Cobey, this is a standard that may help employers.
Do You Know the Way to San Jose?
Cobey also pointed out that San Jose recently became the fifth US city to enact its own minimum wage, and is "by far the largest city to do so." That new requirement of a minimum wage of $10 per hour became effective on March 11, 2013, and represents a $2 an hour increase. The law not only covers all employers with a facility in San Jose, but all employees who work at least two hours a week in San Jose even if their employers are based outside of the city.
Beginning on January 1, 2014, the minimum wage in San Jose will be adjusted for inflation once a year.
Advice for HR
Cobey concluded by reminding employers to make sure that their classifications are correct. "This is another area which in California is resulting in a lot of class actions," he said.
"While it may seem very tempting to say great you're an exempt employee... an employer would be very well-served to monitor at least once a year those positions they've classified as exempt and make sure that the actual duties of the occupants of those positions still meet those requirements."
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