The 2013-2014 California Legislative Session resulted in a wide-ranging array of new laws providing employee protections and corresponding employer obligations. The most significant new employment law, California’s Healthy Workplaces, Healthy Families Act of 2014, is addressed in the November Workplace Wave posting. The following are some highlights of other new California employment laws, most of which will take effect on January 1, 2015. All of the new laws are accessible at www.leginfo.ca.gov.
New Discrimination Protections
1. Protected Classes Expanded to Unpaid Interns and Volunteers. Under the California Fair Employment and Housing Act (FEHA), employees and applicants are protected against discrimination or harassment based on a variety of protected characteristics (also known as “protected classes”). AB 1443 expands the FEHA to prohibit discrimination and harassment against unpaid interns or individuals who are engaged in a limited duration program to provide unpaid work experience. Such provisions are applicable to employers, labor organizations, employment agencies, and specified training programs.
2. Discrimination Prohibited Based on Driver’s Licenses Issued to Undocumented Persons. In 2013, California law required the Department of Motor Vehicles (DMV) to issue driver’s licenses to undocumented persons who are otherwise qualified for a license (referred to as “AB 60 driver’s licenses”). AB 1660 makes it a violation of the FEHA for an employer to discriminate against employees or applicants because they hold an AB 60 driver’s license as this would constitute national origin discrimination. Furthermore, employers are prohibited from requiring an individual to present a driver’s license, unless having a driver’s license is required by law or having a driver’s license is required by the employer and the employer’s requirement is permitted by law.
Employers remain subject to federal law requiring verification of employees’ eligibility to work in the United States via Form I-9, and AB 1660 clarifies that compliance efforts in this regard do not violate California law. Under the new law, employers are also required to treat employees’ driver’s license information as private and confidential.
3. Additional Immigration Discrimination Protections. Under current law, unfair immigration-related practices include threatening to file or filing a false police report. AB 2751 expands this definition to include threatening to file or the filing of a false report or complaint with any state or federal agency. Furthermore, AB 2751 prohibits an employer from discharging or discriminating, retaliating, or taking any adverse action against an employee because the employee updates or attempts to update personal information based on a lawful change of name, social security number, or federal employment authorization document.
4. Discrimination Protections for Public Assistance Recipients and Public Disclosure Requirements. In a new law that appears to be aimed at certain “big box” retail companies, AB 1792 prohibits employers from discharging, discriminating or retaliating against employees who enroll in the Medi-Cal program and from refusing to hire a beneficiary of the Medi-Cal program. The new law requires the California Department of Finance to annually transmit to the Legislature and post on its website those employers who employ 100 or more Medi-Cal beneficiaries.
Time Off Protections
1. Time Off for Emergency Duty Expanded. California law previously prohibited employers from terminating or discriminating against employees for taking time off due to their emergency duty as a volunteer firefighter, reserve peace officer or emergency rescue personnel. AB 2536 amends the definition of “emergency rescue personnel” to include an officer, employee, or member of a disaster medical response entity sponsored or requested by the state. Under existing law, this definition includes an officer, employee, or member of a political subdivision of the state, or of a sheriff’s department, police department, or a private fire department.
New Training Requirements
1. Harassment Prevention Training Must Encompass How to Prevent Abusive Conduct. For a number of years, employers with 50 or more employees in California have been required to provide harassment prevention training to supervisors every other year (sometimes referred to as AB 1825 training). AB 2053 expands the content that must be provided to include information on the prevention of “abusive conduct.” It is defined as malicious conduct that a reasonable person would find hostile, offensive, and unrelated to an employer’s legitimate business interests. Examples of such conduct include repeated infliction of verbal abuse, such as the use of derogatory remarks, insults, epithets, verbal or physical conduct that a reasonable person would find threatening or intimidating, and gratuitous sabotage or undermining another person’s work performance. The new law provides that a singe act is not considered abusive unless it is severe and egregious.
This bill does not extend the FEHA to cover workplace bullying (i.e., abusive conduct) although that may very well be proposed in the 2015 legislative session.
Wage and Hour Obligations
1. New Compensation Minimum for Computer Professional Overtime Exemption. The Department of Industrial Relations has announced that, effective January 1, 2015, the minimum hourly rate for computer software professionals to qualify as exempt from overtime has been increased from $40.38 to $41.27 per hour. The monthly salary requirement for these employees has been raised to $7,165.12, which equates to an annual salary of $85,981.40.
2. Paid Recovery Periods for Heat Illness. California law requires that employees who work outdoors must be provided with cooldown periods to prevent heat illness. If these recovery periods are not provided, employees must pay an additional hour’s pay to the employee, per a law enacted last year. This year, SB 1360 affirms that recovery periods taken under the heat illness regulations are paid breaks and are counted as hours worked.
3. Deadline to Recover Liquidated Damages for Minimum Wage Violations. AB 2074, which amends California Labor Code § 1194.2, provides that a lawsuit to recover liquidated damages for minimum wage violations may be filed at any time before the expiration of the statute of limitations for bringing the underlying action, which is three years.
Joint Employer Liability Standards
1. Expanded Liability for Employers that Contract for Labor. Sponsored by some of the large labor unions citing concerns for protecting workers “in the shadows of the subcontracted economy,” AB 1897 expands upon current law which prohibits entering into a contract for labor or services with specified types of contractors (e.g., construction, farm labor, garment, janitorial, security guard, or warehouse contractor) if the contract does not include funds sufficient to allow the contractor to comply with all applicable local, state, and federal laws. This new law requires a “client employer,” as defined, to share the labor contractor’s civil legal liability for all workers supplied by that labor contractor for the payment of wages and for any failure to obtain valid workers’ compensation coverage.
Covered “client employers” include business entities that obtain or are provided workers to perform labor within its usual course of business from a labor contractor. “Client employers” do not include: (1) those with less than 25 workers, including employees hired directly by the employer and those provided by labor contractors; and (2) businesses with five or fewer workers supplied by a labor contractor to the client employer at any given time. Covered “labor contractors” include individuals or entities that supply, either with or without a contract, a client employer with workers to perform labor within the client employer’s usual course of business (e.g. staffing agencies for temporary employees). “Labor contractor” does not include: (1) bona fide nonprofit, community-based organizations that provide services to workers; and (2) bona fide labor organizations or apprenticeship programs or hiring halls operated pursuant to a collective bargaining agreement. This new law excludes employees of labor contractors who qualify for an overtime exemption.
This new law prohibits client employers from attempting to contract around these provisions by shifting responsibilities solely to the labor contractor, but does not prohibit establishing or enforcing remedies against each other, including indemnification for the other party’s violations of this law. This law also prohibits a client employer from shifting liability to the labor contractor to provide a safe workplace for workers supplied by the labor contractor.
The law does not impose individual liability on a homeowner for labor or services performed at the home. It will not impose liability on an employer for its use of a bona fide independent contractor other than a labor contractor.
Group Health Insurance Obligations
1. Clarification Regarding Waiting Periods for Participation in Group Health Plans. Under the federal Patient Protection and Affordable Care Act (PPACA), group health plans and health insurance issuers offering group health insurance coverage are prohibited from applying a waiting period that exceeds 90 days. SB 1034, which amends California Health and Safety Code § 1357.51, clarifies that employer-mandated waiting periods must conform to the 90-day period authorized under the federal PPACA.
- Review and update your Employee Handbook. For example:
- Update your Time Off for Emergency Duty policy to include the expanded definition of emergency rescue personnel and, if applicable, additional notice requirements for health care providers.
- If your organization has unpaid interns or volunteers, expand your Equal Employment Opportunity and Harassment Prevention policies to cover these individuals.
- If you provide health care coverage to your employees, ensure you do not mandate a waiting period greater than 90 days.
- Review and update new hire policies and procedures. For example:
- Ensure that protections are in place to avoid potential discrimination against applicants or employees who hold an “AB 60 driver’s license,” while ensuring compliance with federal immigration law requirements. Refer to the USCIS Form I-9 for a list of acceptable documents to prove identity and eligibility to work in the United States.
- If you require employees to provide proof of a valid driver’s licenses, ensure it is permissible under applicable law.
Employ safeguards to ensure the confidentiality and privacy of driver’s license information contained in employee personnel files.
- Update your supervisor harassment prevention training to include the prevention of abusive conduct.
- Ensure your California-based computer software professionals are paid at least the new minimum amount to ensure their overtime exemption status.
- If your employees are subject to the heat illness recovery requirements, provide the requisite paid breaks.
- If you use labor contractors, such as staffing agencies, in the course your business, determine whether you are a covered “client employer” under AB 1987. If so, ensure your labor contractors are paying wages appropriately and providing worker’s compensation coverage to reduce risk.
For more information or assistance with employment law compliance matters, please contact Ms. Topliff at email@example.com.