With the New Year on the horizon, we wanted to highlight the following changes to California law which will become effective on January 1, 2014:
Please contact any member of our Employment Group with questions regarding how any of these may impact your business.
MILITARY AND VETERAN STATUS ADDED AS A PROTECTED CATEGORY UNDER THE CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT (FEHA)
Assembly Bill 556 amends the FEHA to add "military and veteran status" to the list of categories protected from employment discrimination. "Military and veteran status" is defined by the Act as "a member or veteran of the United States Armed Forces, United States Armed Forces Reserve, the United States National Guard, and the California National Guard." The new law provides an exemption for any inquiry by an employer regarding military or veteran status for the purpose of awarding a veteran's preference as permitted by law.
EXPANSION OF EMPLOYMENT PROTECTIONS FOR EMPLOYEES WHO ARE CRIME VICTIMS, INCLUDING OBLIGATIONS TO PROVIDE REASONABLE ACCOMMODATIONS
Existing laws prohibit an employer from discharging, discriminating, or retaliating against an employee who is a victim of domestic violence or sexual assault for taking time off from work in connection with court proceedings or to seek medical attention and other specified services as a result of these crimes against them.
Senate Bill 400 extends these time-off protections to employees who are victims of stalking. In addition, the new law prohibits discharge, discrimination, and retaliation against employees because of their status as a victim of domestic violence, sexual assault, or stalking if the employee/victim provides notice to the employer or the employer has actual knowledge of this status.
In addition, Senate Bill 400 requires employers to provide reasonable accommodations to employees who are victims of domestic violence, sexual assault, or stalking and request an accommodation for their safety while at work. The law states that reasonable accommodations may include the implementation of safety measures, including: a transfer, reassignment, modified schedule, changed work telephone, changed work station, installed lock, assistance in documenting domestic violence, sexual assault, or stalking that occurs in the workplace, an implemented safety procedure, or another adjustment to a job structure, workplace facility, or work requirement in response to domestic violence, sexual assault, or stalking, or referral to a victim assistance organization.
In accordance with reasonable accommodation procedures under disability discrimination laws, Senate Bill 400 requires the employer to engage in a timely, good faith inactive process with the employee to determine effective reasonable accommodations and does not require the employer to undertake any action that would constitute undue hardship.
An employer may request an employee to provide a written certification that the employee is a victim of domestic violence, sexual assault or stalking, and that the requested accommodation is for the safety of the victim while at work. Any documentation provided to an employer identifying an employee as a victim of domestic violence, sexual assault or stalking must be kept confidential and not disclosed by the employer except as required by law or necessary for the safety of employees in the workplace. The employer must give the employee notice before any disclosure of the information is made.
Employees are required to notify their employer when an accommodation is no longer needed. The employee may request a new accommodation based on changed circumstances, and in such a case, the employer must repeat the interactive process with the employee.
Employers are prohibited from retaliating against an employee who has requested a reasonable accommodation, whether the request was granted or not. Senate Bill 400 authorizes reinstatement, back pay, and injunctive relief for violations of the law.
ANTI-RETALIATION LAWS EXPANDED, INCLUDING A PROHIBITION OF UNFAIR IMMIGRATION RELATED PRACTICES
Existing law prohibits employers from discharging an employee or in any manner discriminating against any employee or applicant for employment because the employee or applicant has engaged in protected conduct relating to the enforcement of the employee's or applicant's employment and civil rights, such as being paid all wages due and being free from discrimination or harassment based on their membership in a protected class. Existing law also prohibits an employer from making, adopting, or enforcing any rule, regulation, or policy preventing an employee from disclosing information to a government or law enforcement agency, where the employee has reasonable cause to believe that the information discloses a violation of state or federal statute, or a violation or noncompliance with a state or federal rule or regulation. Existing law further prohibits an employer from retaliating against an employee for such a disclosure. Existing law entitles employees to reinstatement and reimbursement for lost wages, as well as penalizing employers for retaliating against employees for engaging in these protected activities.
Expansion of Prohibited Conduct
Assembly Bill 263 and Senate Bill 666 expand the prohibitions against an employer from retaliating or taking adverse action against any employee or applicant for employment because the employee or applicant has engaged in protected conduct. One of the significant protections provided is codified in Labor Code section 1019, which prohibits employers from engaging in, or directing another person to engage in, an unfair immigration-related practice against a person for the purpose of or with the intent of retaliating against any person for engaging in any of the following protected activities: (1) filing a complaint of an employer's alleged violation of state labor and employment laws or a local ordinance applicable to employees, or informing a person of his/her rights under these laws and ordinances; (2) assisting others in asserting their rights; and (3) seeking information on whether an employer has complied with state labor and employment laws. An example of such an unfair immigration-related practice is where an employer threatens to contact, or contacts, immigration authorities because an employee complained that he/she was paid less than the minimum wage.
Under this provision, there is a rebuttable presumption that an adverse action taken within 90 days of the exercising of a protected right is committed for the purpose of, or with the intent of, retaliation.
Senate Bill 666 adds Sections 494.6 and 6103.7 to the Business and Professions Code and amends Sections 98.6 and 1102.5 of the Labor Code and adds Section 244 to the Labor Code. As a result of these amendments and additions, (1) it is considered an adverse action for employers to report or threaten to report an employee's, former employee's, or prospective employee's (or any family member of the foregoing) suspected citizenship or immigration status to a federal, state, or local agency because the employee, former employee, or prospective employee exercises a right related to his or her employment; (2) it unlawful for an employer to retaliate against employees who submit a written or oral complaint that he or she is owed unpaid wages; and (3) any person acting on behalf of an employer is prohibited from making, adopting, or enforcing any rule, regulation, or policy preventing an employee from disclosing information to a government or law enforcement agency, as provided, and would extend those prohibitions to preventing an employee from, or retaliating against an employee for, providing information to, or testifying before, any public body conducting an investigation, hearing, or inquiry.
Likewise, attorneys who are a members of the State Bar can be suspended, disbarred, or otherwise disciplined if they report suspected immigration status or threaten to report suspected immigration status of a witness or party to a civil or administrative action or his or her family member to a federal, state, or local agency because the witness or party exercises or has exercised a right related to his or her employment.
Section 1024.6 of the Labor Code was also added and prohibits an employer from discharging an employee or in any manner discriminating, retaliating, or taking any adverse action against an employee because the employee updates or attempts to update his or her personal information, unless the changes are directly related to the skill set, qualifications, or knowledge required for the job.
Expansion of Penalties
Various penalties are authorized against employers that engage in unfair immigration-related practices, including a private right of action for equitable relief and damages or penalties, and the suspension of certain business licenses held by the violating party for prescribed periods based on the number of violations.
Violations of Sections 98.6, 98.7, 244, and 1102.5 of the Labor Code can result in the assessment of a penalty of $10,000 per violation. Additionally, an aggrieved employee could be entitled to reinstatement and reimbursement for lost wages. Moreover, the law has been expanded such that it is no longer necessary for an employee to exhaust administrative remedies or procedures with the Labor Commissioner in the enforcement of specified provisions before filing a lawsuit against an employer for any violation of law over which the Labor Commissioner has jurisdiction.
DOMESTIC WORKER BILL OF RIGHTS
Assembly Bill 241 establishes overtime pay protection for domestic workers (i.e. nannies, housekeepers, and caregivers) employed by private individuals such that they are paid a rate of time-and-a half for all hours worked in excess of nine hours in one day or more than 45 hours in one week. This law goes into effect January 1, 2014 and will expire on January 1, 2017 at which time it can be renewed into law.
This law does not apply to casual babysitters, caretakers employed in medical, nursing, convalescent, aged, or child care facilities, or to individuals who perform services through specified in-home supportive service programs.
COURT RECOVERY OF UNREMITTED EMPLOYEE WAGE WITHHOLDINGS
Existing law makes it a crime for an employer to willfully, or with the intent to defraud, fail to remit agreed-upon payments to health and welfare funds, pension funds or vacation plans, or other various benefit plans. The crime is a felony where the amount the employer fails to remit exceeds $500. All other violations are punishable as a misdemeanor.
Senate Bill 390 amends this provision of Labor Code section 227, making it a crime for an employer to fail to remit withholdings from an employee's wages that were made pursuant to state, local, or federal law, for example, for taxes. The new law also provides for any recovered withholdings to be forwarded to the appropriate plan or fund and for any restitution obtained in the criminal proceeding to be paid to the agency, entity, or person to whom it is owed.
PENALTY FOR MISSED HEAT ILLNESS PREVENTION RECOVERY PERIODS
The current version of Labor Code section 226.7 provides a penalty of one hour's pay for each day that an employee is required to work during any required meal or rest period. Cal-OSHA regulations require employers of certain outdoor workers to encourage and allow the workers to take a cool down rest in the shade for a period of no less than five minutes at a time when they feel the need to do so to prevent overheating.
Senate Bill 435 expands Labor Code section 226.7, making it applicable to missed recovery periods, unless the employee is exempt from the recovery period rules. The law defines a recovery period as a cool down period afforded an employee to prevent heat illness.
CIVIL PENALTY FOR GARMENT MANUFACTURERS WHO DO NOT DISPLAY INFORMATION ON FRONT ENTRANCE OF BUSINESS
Existing law requires garment manufacturers to be registered with the State of California. Registered garment manufacturers are required to display their name, address, and garment manufacturing registration number on the front entrance of their business. AB 1384, to be added to the Labor Code as Section 2676.55, provides a civil penalty for garment manufacturers who fail to display this required information in the amount of: (1) $100 for each calendar day that the person engages in garment manufacturing without complying, as an initial citation; and (2) $200 for each calendar day that the person engages in garment manufacturing without complying, as a subsequent citation.
LIENS ON REAL PROPERTY BY LABOR COMMISSIONER
Under current law, the California Labor Commissioner has the authority to hear employee complaints regarding the payment of wages and other employment-related issues. The Labor Commissioner is required to file an order, decision, or award within 15 days after the hearing on the employee complaint. Once the order is final, the Labor Commissioner is required to file the final order with the Clerk of the Superior Court. The Clerk of the Superior Court enters judgment in conformity with the final order, which has the same force and effect as a judgment entered in a civil action.
Assembly Bill 1386 amends existing law to provide that as an alternative to obtaining a court judgment, upon the Labor Commissioner's order becoming final, the Labor Commissioner may create a lien on the employer's real property by recording a certificate of lien with the county recorder of any county in which the employer's real property may be located. Unless the lien is satisfied or released, the lien will continue until 10 years from the date of its creation.
FEE AWARD TO PREVAILING EMPLOYER IN CERTAIN ACTIONS REQUIRES EMPLOYEE BAD FAITH
Existing law, with certain exceptions, requires a court in any action brought for the nonpayment of wages, fringe benefits, or health and welfare or pension fund contributions, to award reasonable attorneys' fees and costs to the prevailing party if any party to the action requests attorney's fees and costs at the time action is initiated.
Senate Bill 462 amends California Labor Code §218.5 to make the award of attorneys' fees and costs where the prevailing party is not an employee contingent on a finding by the court that the employee brought the court action in bad faith. The law does not apply to actions brought by the California Labor Commissioner. The law also does not apply to a claim for which attorneys' fees are recoverable under California Labor Code § 1194, which allows an employee to sue for unpaid or underpaid minimum wages or overtime and recover reasonable attorneys' fees if they prevail in the action.
SAN FRANCISCO'S FAMILY-FRIENDLY WORKPLACE ORDINANCE ALLOWS REQUESTS FOR FLEXIBLE WORK ARRANGEMENTS
San Francisco's new Family-Friendly Workplace Ordinance (the "Ordinance") applies to employers with 20 or more employees and to those San Francisco-based employees who have been employed for at least six months and who work at least eight hours per week on a regular basis. The Ordinance provides eligible employees the right to request a flexible or predictable work arrangement to assist with care for: (1) children under the age of 18; (2) persons with a serious health condition in a family relationship with the employee; or (3) a parent (age 65 or older) of the employee. An employer must meet with an employee within 21 days of the employee's request and must respond to the request within 21 days of that meeting. If the employer grants the request, the employer must confirm the arrangement in writing. If the employer denies the request, the employer must explain the denial in a writing that: (1) sets forth a bona fide business reason for the denial; (2) provides the employee with notice of the right to request reconsideration; and (3) includes a copy of that portion of the Ordinance addressing the right to reconsideration. A bona fide business reason includes, but is not limited to, the cost of the change, a detrimental effect on the ability to meet customer or client demands, the inability to organize work among other employees, or the insufficiency of work to be performed during the time the employee proposes to work.
Laws Effective July 2014
INCREASE IN CALIFORNIA MINIMUM WAGE
Assembly Bill 10 raises California's hourly minimum wage rate to $9.00 per hour, beginning July 1, 2014. Effective January 1, 2016, the minimum wage rate will increase an additional $1.00 to reach $10.00 per hour. In addition to adjusting the rates of pay for non-exempt hourly employees, employers should review the salaries of their exempt employees to ensure that they earn a minimum monthly salary of no less than two times the state minimum wage for full-time employment. Also note that effective January 1, 2014, minimum hourly rate exemption for computer software employees, as defined by Labor Code section 515.5, increases from $39.90 to $40.38, the minimum monthly salary exemption from $6,927.75 to $7,010.88, and the minimum annual salary exemption from $83,132.93 to $84,130.53.
DEFINITION OF "FAMILY" UNDER PAID FAMILY LEAVE LAW EXPANDED
Currently, the California Employment Development Department, (EDD), through employee payroll deductions, provides for family temporary disability insurance benefits to workers who need to care for a seriously ill "family member" – specifically, children, spouses, parents, or domestic partners. Effective July 1, 2014, Senate Bill 770 expands the definition of "family member" to include a grandparent, grandchild, sibling, or parent-in-law. Employers should note that employee eligibility for PFL is determined by the EDD rather than employers, and this law does not impact employee eligibility or leave rights under the California Family Rights Act, the Family Medical Leave Act, or other laws protecting the employment status of employees who to take time off to care for family members.
Authorship Credit: Damon M. Brown, Diamond M. Hicks, Dawn Kennedy and Sabrina L. Shadi
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