New Law Seeks to Encourage Higher Wages Through the Public Shaming of Employers

Ervin Cohen & Jessup LLP
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Businessman with paper bag on his headOne of the more interesting laws to emerge from the 2014 legislative session was Assembly Bill 1792. AB 1792 amends and adds sections to the Government Code, Unemployment Insurance Code and Welfare and Institutions Code. Specifically, the law requires the State of California to compile information on the use of public assistance programs, including the average cost of state and federally funded benefits provided to each individual receiving benefits. “Public assistance program” is defined specifically as the Medi-Cal program. Beginning in January of 2016, the law requires the state to post on the Internet a list of the top 500 employers that employ public assistance beneficiaries in California. “Employer” is defined as employing 100 or more beneficiaries. “Beneficiary” is defined as anyone enrolled for six months or more in any public assistance program and who is employed for one quarter, excluding any seniors or disabled persons. In addition to requiring the posting of this list, the law prohibits any employer from discriminating or retaliating against beneficiaries and further prohibits the employer from disclosing an employee’s participation in a public assistance program. AB 1792 has a sunset provision which states that the law will expire on January 1, 2020.

AB 1792 is a creative effort by the state assembly to address a growing problem in California. Specifically, California has the highest number of poor working families in the country. These are families that have income at well below the federal poverty line, which is currently $24,250 for a family of 4 living in the contiguous United States. The assembly perceives that employers who employ participants in public assistance programs are in fact shifting part of the cost of doing business to taxpayers in the State of California. It will be interesting to see how taxpayers react to the public shaming of these employers.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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