6 th Annual Labor Law Update 2019 LAWS FOR CALIFORNIA EMPLOYERS

Transcription

1 6 th Annual Labor Law Update 2019 LAWS FOR CALIFORNIA EMPLOYERS

2 WELCOME 6th annual labor and employment law update Review new and revised federal, state and local labor and employment laws Please ask questions if you have them

3 Presenter Dr. Carlyle Rogers, JD/PsyD President and CEO of BPSC 28 years human resources and labor/employment law experience, including 21 years in California Author of Dirty Little Secrets: Declassifying the Employment Game

4 Agenda Federal Laws California Laws California Local Laws Important Future Laws Signed

5 Things to Consider Employees in other states Total employee headcount State and local law applications Employee headcount Leaves of absence ACA Harassment training Multiple locations, units and entities Determining if they are independent or collective

6 ANY QUESTIONS BEFORE WE GET STARTED?

7 FEDERAL LAWS AFFECTING CALIFORNIA EMPLOYERS

8 Important to Watch Trump administration recently formally announced the intention to issue a Notice of Proposed Rulemaking in March Increase in minimum exempt salary for administration, professional and executive classifications. No specific number yet, but anticipated to be in the $30,000s.

9 Thoughts We saw this process under the Obama administration. Best to run hypothetical numbers for budgeting (make plans now; don t be behind the ball).

10 CALIFORNIA LAWS

11 State Minimum Wage Effective January 1, 2019 Employers with 1-25 employees $11.00 per hour Employers with 26+ employees $12.00 per hour Local minimum wage rates may be greater than state, thus employers must review the local minimum wage rates

12 State Minimum Exempt Salary With minimum wage increases comes increases in the minimum salary requirements for exempt employees under Executive, Administrative and Professional exemptions. Employers with 1-25 employees increase to $45,760 Employers with 26+ employees increase to $49,920 Effective January 1, 2019

13 State Minimum Exempt Salary Employees exempt under the Computer Professional exempt class increase from $90, to $94, (or $7, per month). Effective January 1, 2019

14 Required Posters With changes to such things as minimum wage, the requirement for updated labor law posters is triggered. January 1, 2019 will be the due date to have the new posters in place.

15 SB 224: Sexual Harassment Amends section 51.9 of the Civil Code to expand the types of relationships that can be subject to a claim for sexual harassment to include lobbyists, elected officials, directors, producers, and investors. This statute generally applies to work relationships where one person holds themselves out as being able to help someone establish a business or professional relationship directly or with a third party.

16 SB 820: Sexual Harassment Prohibits provisions in settlement agreements entered into after January 1, 2019 that prevent disclosure of factual information pertaining to claims of sexual assault, sexual harassment, gender discrimination or related retaliation that have been filed in court or before an administrative agency. It does not prohibit a provision that prevents the parties to the agreement from disclosing the amount of the settlement.

17 SB 820: Sexual Harassment Examples Facts underlying claims in an administrative or civil action for sexual harassment under California Civil Code section 51.9, Employment-related harassment or discrimination based on sex, Failure to prevent such discrimination or harassment, or An act of retaliation for reporting such harassment or discrimination, cannot be restricted by use of a non-disclosure agreements.

18 SB 820: Sexual Harassment Additionally, at the claimant request, the settlement agreement may include a provision that limits the disclosure of the claimant s identity or of facts that would lead to the discovery of the claimant s identity.

19 SB 820: Checklist Employers will have to have their settlement agreements revised to meet the new standards AND should assume that plaintiff attorneys will seek the extent of nondisclosure for their clients.

20 SB 1300: Sexual Harassment The legislature declared its intent to create a much lower bar for employees to bring harassment lawsuits, and limited the ability of employers to obtain summary judgment in such cases. Limits employer s ability to obtain nondisparagement agreements or a release of claims from employees.

21 SB 1300: Affirmed Harris v. Forklift Systems Approved the standard that in a workplace harassment suit the plaintiff need not prove that his or her tangible productivity has declined as a result of the harassment. It suffices to prove that a reasonable person subjected to the discriminatory conduct would find, as the plaintiff did, that the harassment so altered working conditions as to make it more difficult to do the job.

22 SB 1300: Affirmed Reid v. Google, Inc. Affirmed the California Supreme Court s rejection of the stray remarks doctrine, because the existence of a hostile work environment depends on the totality of the circumstances and a discriminatory remark, even if made not directly in the context of an employment decision or uttered by a nondecisionmaker, may be relevant, circumstantial evidence of discrimination.

23 SB 1300: Affirmed Nazir v. United Airlines, Inc. Affirmed that hostile working environment cases involve issues not determinable on paper.

24 SB 1300: Rejected Brooks v. City of San Mateo Prohibits reliance on Judge Alex Kozinksi s Ninth Circuit opinion to determine what conduct is sufficiently severe or pervasive to constitute actionable harassment under FEHA.

25 SB 1300: Rejected Kelley v. Conco Companies Disapproved use of this case to support different standards for hostile work environment harassment depending on the type of workplace.

26 SB 1300: Sexual Harassment Prohibits employers from requiring an employee to sign (as a condition of employment, raise, or bonus): (1) a release of FEHA claims or rights or (2) a document prohibiting disclosure of information about unlawful acts in the workplace, including non-disparagement agreements. This provision does not apply to negotiated settlement agreements to resolve FEHA claims filed in court, before administrative agencies, alternative dispute resolution, or though the employer s internal complaint process.

27 SB 1300: Sexual Harassment Expands an employer s potential FEHA liability for acts of nonemployees to all forms of unlawful harassment (removing the sexual limitation). Prohibits a prevailing defendant from being awarded attorney s fees and costs unless the court finds the action was frivolous, unreasonable, or groundless when brought or that the plaintiff continued to litigate after it clearly became so. Authorizes (but does not require) employers to provide bystander intervention training to its employees.

28 Bystander Intervention Training Training related to what bystanders can do to help a victim of harassment and deescalate the incidents of hate. For example, harassment, bullying, and assault.

29 SB 1300: Summing It Up Reduces the need for evidence related to decreased performance based upon the assumption that it is reasonable that it occurs. Conduct previously defined as severe and pervasive eliminated, thus becoming a matter of interpretation. Stray remarks made and not related to disparate actions against an employee may be considered as relevant.

30 SB 1300: Summing It Up Industry and types of work environments no longer factored when determining harassment. Acts by non-employees now included under FEHA liabilities, thus acts by customers, clients, visitors, etc.

31 AB 1619: Sexual Harassment This new law greatly enlarges the statute of limitations for filing a civil action for damages for sexual assault to 10 years after the alleged assault or 3 years after the plaintiff discovered or reasonably discovered injury as a result of the assault, whichever is later.

32 AB 3109: Sexual Harassment Makes void and unenforceable any provision in a contract or settlement agreement that prevents a party to the contract from testifying about criminal conduct or sexual harassment in an administrative, legislative, or judicial proceeding.

33 AB 2770: Defamation Protection Employers and victims of sexual harassment will be protected from liability for defamation lawsuits for injury to an alleged harasser s reputation after a complaint of sexual harassment has been made. An employee who makes credible reports of harassment will be shielded from liability, as will an employer who communicates with interested parties such as victims and witnesses.

34 AB 2770: Defamation Protection When contacted for a job reference about a current or former employee, an employer will now be permitted to reveal whether the individual is not eligible for rehire because the employer determined that he/she engaged in sexual harassment.

35 SB 826: Gender Composition of Boards This new law provides for mandatory inclusion of women on corporate boards of directors. Specifically, by the end of 2019, publicly held domestic or foreign corporations with principal executive offices in California must have a minimum of one female director on its board, and by the end of 2021, these corporations must comply with the following:

36 SB 826: Gender Composition of Boards (1) If its number of directors is 6+, the corporation shall have a minimum of 3 female directors; (2) If its number of directors is 5, the corporation shall have a minimum of 2 female directors; (3) If its number of directors is 4 or fewer, the corporation shall have a minimum of 1 female director.

37 SB 1976: Lactation Accommodation Revises the existing law that requires employers to make reasonable efforts to provide a location other than a toilet stall to be used for lactation. The revisions provide that the location should be something other than a bathroom and further specifies that it generally should be a permanent location but that it can be a temporary location if:

38 SB 1976: Lactation Accommodation (1) the employer is unable to provide a permanent location due to operational, financial, or space limitations; (2) the temporary location is private and free from intrusion while being used for lactation purposes; and (3) the temporary location is not used for other purposes while being used for lactation.

39 SB 1976: Lactation Accommodation The new law also provides that an agricultural employer may comply by allowing an employee to use the air-conditioned cab of a tractor or truck. If an employer can prove that it is an undue hardship to comply with these requirements, the employer may be able to provide a location (including a bathroom) other than a toilet stall for the employee to use for lactation purposes.

40 SB 1252: Payroll Records Existing law already requires that employees have a right to inspect or copy their payroll records and that they must be allowed to do so within 21 days of such a request. The new law clarifies that if an employee requests a copy of the records, the employer must provide the copies (as opposed to requiring employees to copy the records themselves).

41 SB 1252: Payroll Records Injury assumed when employee does not provide the stubs. Penalties for non-compliance: $50 for first period and $100 per employee for each violation in a subsequent pay period after to aggregate $4,000 Labor Commissioner fee $750 Attorney fees and costs

42 SB 1412: Criminal History Inquiries Amends Labor Code section 432.7, which limits employers ability to conduct criminal history inquiries and to use criminal history information in employment decisions. Existing law makes an exception for employers who are required by federal or state law to inquire into an applicant s or employee s criminal history.

43 SB 1412: Criminal History Inquiries The amendment is intended to tighten the exception to apply only where an employer is required by law to inquire into a particular conviction or where an employer cannot by law hire someone with a particular conviction. to make clear that employers may only consider particular convictions when assessing criminal history.

44 SB 1412: Criminal History Inquiries Particular conviction is defined only to mean a conviction for specific criminal conduct or a category of criminal offenses prescribed by any federal law, federal regulation or state law that contains requirements, exclusions, or both, expressly based on that specific criminal conduct or category of criminal offenses.

45 SB 1412: Criminal History Inquiries Conviction includes a plea, verdict, or finding of guilt, regardless of whether a sentence is imposed by the court and does not include any adjudication by a juvenile court or any other court order or action taken with respect to a person who is under the process and jurisdiction of the juvenile court.

46 SB 1412: To Do Employers using preemployment and employment criminal background checks need to have: 1. clearly defined policies and procedures related to what positions require background checks, 2. clearly defining why and what results will result in negative actions, and 3. ensure that they follow the existing state and local laws related to handling negative results.

47 AB 2282: Salary History Clears up ambiguities in last year s AB 168, the ban on salary history inquiries and the requirement to provide pay scales to applicants. The Labor Code will now specify that employers may inquire about an applicant s salary expectations for the position being applied for. External applicants (not current employees) are entitled to a pay scale upon request, but only after completing an initial interview.

48 AB 2282: To Do Confirm that there is nothing requesting an applicant s salary history, including paper and electronic applications (e.g., work history starting and ending salary). Ensure that interviewers are trained and knowledgeable not to inquire about an applicant s salary history (including benefits) prior to an offer being extended.

49 AB 1565: Contractor Liability This new law took effect immediately as urgency legislation. It clarifies a new law enacted last year making certain direct contractors performing work in the state liable for unpaid wages by subcontractors. The amendments to the law provide requirements that must be met in order for a direct contractor to withhold payments to a subcontractor for disputed sums.

50 AB 1565: Contractor Liability In order to withhold payment, the contractor must specify in its contract with a subcontractor all items of information that will be requested of the subcontractor, such as payroll records and other information related to hours worked, etc.

51 AB 1565: Contractor Liability For purposes of this law, a direct contractor is one making or taking a contract in the state for the erection, construction, alteration, or repair of a building, structure, or other private work

52 SB 1402: Port Drayage Workers Provides that customers who use the services of a port drayage motor carrier are jointly and severally liable with the motor carrier for nonpayment of wages, expenses, damages, and penalties. This includes goods being shipped a short distance via ground freight or the charge for such transport, generally trucking services from an ocean port to a rail ramp, warehouse or other destination.

53 SB 1402: Port Drayage Workers The new Labor Code Section (b)(3) creates additional and significant liabilities for businesses that rely upon port trucking companies. This provision states that a customer that engages or uses a port trucking company on the blacklist shall share all civil legal responsibility and civil liability owed to a driver for services obtained after the date the company appeared on the blacklist.

54 SB 1402: Port Drayage Workers The new law specifies that this means joint and several liability with the trucking company for the full amount of unpaid wages, unreimbursed expenses, damages and penalties. Every customer that uses a port trucking company on the blacklist in a given workweek shall be jointly and severally liable for unpaid wages and other damages which are found to be owed by the port trucking company for that workweek.

55 SB 1402: Port Drayage Workers SB 1402 contains an expansive definition of customer of a port trucking company. Specifically, customer means a business that engages or uses a port trucking company to perform services on the customer s behalf, whether the customer directly engages or uses a port trucking company or indirectly uses a company through the use of an agent such as a freight forwarder, motor transportation broker, ocean carrier, or other motor carrier.

56 SB 1402: Port Drayage Workers However, customer does not include: (1) a business with fewer than 25 workers, (2) public entities, or (3) a marine terminal operator or similar business who has incidental relationships with port trucking companies.

57 SB 1402: Port Drayage Workers Joint liability under the new law may be determined by the Labor Commissioner or court in a civil action (following 30 days notice to the customer). The positive at this juncture is that this new law does not currently include any civil action for joint liability to the PAGA of 2004.

58 SB 1402: Port Drayage Workers SB 1402 specifies that the joint liability provisions do not apply to the following: Customers who engage with port trucking companies whose employees are covered by a bona fide collective bargaining agreement. Where the customer and the trucking company had an existing contract at the time the company is listed on the blacklist, joint liability shall not apply until the expiration of that contract or 90 days, whichever is shorter. Where a port trucking company is not listed on the DLSE blacklist. Where the port trucking company satisfied the judgment prior to the time period for which the joint and several liability is alleged.

59 SB 1402: Port Drayage Workers The DLSE is also required to create and post a list of port drayage carriers with unsatisfied judgments, including for failure to pay wages, imposing unlawful expenses, failure to remit payroll taxes, failure to provide workers compensation insurance, or misclassification of employees as independent contractors.

60 AB 2605: On-Call Rest Breaks (Petroleum Industry) Provides that unionized workers in safety sensitive positions in the petroleum industry may be required to remain on call during rest breaks. This bill effectively provides an industry-specific exception to the California Supreme Court s recent unfavorable ruling in Augustus v. ABM Security, which held that employees cannot be required to remain on call during rest breaks.

61 AB 1654: PAGA Relief (Unionized Construction Employers) Provides that unionized workers in the construction industry are not covered by PAGA (i.e. they cannot bring PAGA claims), provided that the CBA: (1) is entered into prior to January 1, 2025; (2) provides for the wages, hours of work, and working conditions of employees, premium wage rates for all overtime hours worked, and for the employee to receive a regular hourly pay rate of not less than 30 percent more than the state minimum wage rate;

62 AB 1654: PAGA Relief (Unionized Construction Employers) (3) prohibits all of the violations of the Labor Code that normally would be redressable under PAGA; (4) provides for a grievance and binding arbitration procedure to redress those violations and authorizes the arbitrator to award any and all remedies otherwise available under the Labor Code (except PAGA remedies); and (5) expressly waives PAGA rights.

63 CALIFORNIA LOCAL LAWS

64 Local Minimum Wage Rate Increases Berkeley October 1, 2019 CPI/Pending Cupertino January 1, 2019 $15.00 El Cerrito January 1, 2019 $15.00 Emeryville (1-55) July 1, 2019 $16.00 Emeryville (56+) July 1, 2019 $16.00 (est) Los Altos January 1, 2019 $15.00

65 Local Minimum Wage Rate Increases Los Angeles County (1-25) July 1, 2019 $13.25 Los Angeles County (26+) July 1, 2019 $14.25 Malibu (1-25) July 1, 2019 $13.25 Malibu (26+) July 1, 2019 $14.25 Milpitas July 1, 2019 $15.00 Mountain View January 1, 2019 $15.65 (est)* Palo Alto January 2, 2019 $15.00 *Pending request to freeze increase

66 Local Minimum Wage Rate Increases Pasadena (1-25) July 1, 2019 $13.25 Pasadena (26+) July 1, 2019 $14.25 Richmond (EE benefits) July 1, 2019 $13.50 Richmond (No EE benefits) July 1, 2019 $15.00 San Francisco July 1, 2019 CPI San Leandro July 1, 2019 $14.00

67 Local Minimum Wage Rate Increases San Mateo (Non-Profit) January 1, 2019 $13.50 San Mateo (For-Profit) January 1, 2019 $15.00 Santa Clara January 1, 2019 $15.00 Santa Monica (1-25) July 1, 2019 $13.25 Santa Monica (26+) July 1, 2019 $14.25 Santa Monica (Hotels) July 1, 2019 CPI Sunnyvale January 1, 2019 CPI

68 Oakland July 1, 2019 Hotel Industry Measure Z approved which triggers increase to $20/hour (no health benefits) or $15/hour (employer pays $5 towards health care benefits for employee & dependents).

69 San Francisco January 1, 2019 Employers covered by the Health Care Security Ordinance and meets these requirements: 1. employs one or more workers within the geographic boundaries of the City and County of San Francisco; 2. is required to obtain a valid San Francisco business registration certificate pursuant to Article 12 of the Business and Tax Regulations Code, and 3. is a for-profit business with 20 or more persons performing work or a nonprofit organization with 50 or more persons performing work. This includes all persons working for the entity, regardless of whether they are located in San Francisco or outside of the city.

70 San Francisco Businesses must meet the ESR requirements by making health care contributions on behalf of all covered employees. A covered employee is an individual that has been employed for more than 90 days and who regularly works at least 8 hours per week in San Francisco.

71 San Francisco Beginning January 1, 2019, businesses must pay the following rates: Employers with 100+ employees: $2.93 per hour payable (up.10 cents from 2018) Employers with employees: $1.95 per hour payable (up.06 cents from 2018) Employers with fewer than 20 employees are exempt from the requirement Nonprofits with fewer than 50 employees are also exempt from the requirement

72 IMPORTANT FUTURE LAWS SIGNED

73 SB 1343: Sexual Harassment Training Current law requires employers with 50 or more employees to provide supervisors with two hours of sexual harassment training within six months of hire or promotion. Beginning January 1, 2020, all employers with five or more employees will be required to provide two hours of sexual harassment training to supervisors and one hour to non-supervisorial employees within six months of hire or promotion, and every two years after that.

74 SB 1123: Paid Family Leave The Paid Family Leave wage replacement program will be expanded beginning January 1, 2021, to any employee who takes time off to attend to situations related to the covered active duty status of the employee s spouse, registered domestic partner, child or parent who is a member of the US Armed Forces. Known as qualifying exigencies, these situations could include time off for official ceremonies, briefings, changes to child care arrangements, financial or legal arrangements, counseling or spending time with the covered service member during rest and recuperation leave, among others.

75 SB 1123: Paid Family Leave Quick reminder about the California Paid Family Leave It is not a leave of absence It is a state sponsored insurance program It is not to be confused with Family Medical Leave, California Family Leave, Parental Leave or Pregnancy Disability Leave

76 SB 970: Human Trafficking Amends FEHA to require hotel and motel employers, by January 1, 2020, to provide at least 20 minutes of training on human trafficking awareness to employees who are likely to come into contact with victims of human trafficking. These employees include reception employees, housekeeping employees, bell desk employees, and other employees who regularly interact with customers. The new law requires covered employers to provide such training to covered employees within 6 months of hire and once every two years thereafter.

77 AB 2034: Human Trafficking This new law requires employers who operate an intercity passenger rail, light rail, or bus station to provide by January 1, 2021 at least 20 minutes of training on human trafficking awareness to employees who are likely to come into contact with human trafficking victims.

78 CLOSING CHECKLIST

79 To Do Review and adjust non-exempt employee rates of pay based upon state and/or local minimum wage requirements. Review and make sure that your exempt employees are paid the minimum rates of pay based upon the new state minimum wage rates. Obtain and post the updated 2019 labor law posters. Be sure that your Employee Handbooks are updated to reflect the new laws.

80 To Do Review and revise settlement agreements for sexual harassment, sexual assault, gender discrimination and related retaliation. Be sure your supervisors have been trained in harassment, discrimination and retaliation prevention. If you currently have employees sign a release of FEHA claims as a condition of employment, raise or bonus, toss it out.

81 To Do Draft, implement and train employees related to non-employee unlawful harassment. If a corporation, review and plan to have your board composition consistent with the requirements by the end of Review your company lactation areas and make sure they are not in a bathroom and if can only provide a temporary location, that it is one that is private and free from intrusion during use.

82 To Do When payroll records are requested, provide copies and do not require them to be photocopied by the requester. Draft clear policies and procedures related to the need and use of criminal background checks. Ensure interviewers know not to ask candidates about their salary history or criminal history before an offer of employment has been extended.

83 To Do If a contractor using subcontractors, be sure that contracts provide all items of information that will be requested of the subcontractor, especially related to payroll and time records. If you use port drayage motor carriers (and have 26+ employees and are not a public entity and are not a marine terminal operator), confirm they are not listed with the DLSE.

84 To Do If you have 5 or more employees, be prepared to have all supervisors go through the required 2 hour sexual and other harassment prevention training beginning January 2020 and all non-supervisors through the 1-hour training (every two years). If you are a hotel or motel, be prepared to provide human trafficking training to your employees beginning January 2020 and if intercity rail, light rail or bus station, by January 2021.

85 QUESTIONS

86 Thanks for attending our 2019 Labor Law Update!!! For more information or assistance with your human resources, payroll and labor law needs, please contact us at: or You can also visit us at