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Newport Beach
California 92660
Tel: (949) 752-2911
Email: rj@rjlaw.com
Fax: (949) 752-0953
www.rjlaw.com
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2017 EMPLOYMENT LAW UPDATE
The State of California ushered in the New Year with several new laws affecting employers. In addition, cities and counties across California continue the trend of enacting ordinances affecting the employment relationship. Employers should always check their local city and county websites for new laws affecting their businesses. The following is a summary of the more prominent new laws affecting California employers.
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Prohibition on Seeking or Considering Juvenile Criminal History (AB 1843)
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With the passage of California's AB 1843, starting January 1, 2017,
employers are now prohibited from asking a job applicant to disclose, or from utilizing as a factor in determining any condition of employment, information concerning or related to his or her juvenile criminal history. Juvenile criminal history includes information relating to an arrest, detention, processing, diversion, supervision, adjudication, or court disposition that occurred while the person was subject to the process and jurisdiction of juvenile court law. "Adjudication" of crimes includes crimes of murder, arson, rape, kidnapping, torture, carjacking, aggravated mayhem and discharge of a firearm.
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Los Angeles City Prohibition on Seeking Criminal History
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Also effective January 1, 2017, the Los Angeles Fair Chance Initiative imposes several new rules upon private employers regarding inquiries into criminal convictions and adverse action based on criminal convictions. The new rule applies to any employer that employs at least 10 individuals (including the owner), who perform at least two hours of work on average each week within the geographic boundaries of the City of Los Angeles. The key provisions:
- An employer is prohibited from inquiring into an individual's criminal background unless and until a conditional offer of employment is made. Note: the conditional offer may ONLY be conditioned on the criminal background check.
- Inquiries covers any direct or indirect conduct intended to gather criminal history information, so it would include, application forms, interviews and background check reports. Essentially, you cannot learn anything about criminal history prior to making the conditional job offer.
- An employer cannot take adverse action without first conducting a "written assessment that effectively links the specific aspects of the applicant's criminal history with risks inherent in the duties of the employment position sought by the applicant." At a minimum, this means the employer must consider the EEOC factors.
- Prior to taking adverse action, an employer must provide an applicant with a "Fair Chance Process," which includes providing the applicant with the following information: (1) written notification of the proposed adverse action, (2) a copy of the written assessment, and (3) any other information or documentation supporting the proposed adverse action. The employer must then wait for a period of at least 5 business days in order to allow the applicant sufficient time to participate in the "Fair Chance Process" and provide any additional information or documentation to the employer. The employer then needs to perform a written "reassessment" of the proposed adverse action. If the reassessment results in the employer determining adverse action is appropriate, then the employee must notify the applicant of the decision and provide a copy of the written reassessment.
- All job advertisements shall state that the employer will consider for employment all qualified applicants with criminal histories in a manner consistent with the ordinance.
- A notice must also be posted at the workplace informing applicants of the provisions of the ordinance.
- All documents related to each applicant (including applications, conditional offers, reports, assessments and reassessments) must be maintained for a period of at least 3 years.
- Penalties and administrative fines for violations are up to $500 for a first violation, $1,000 for a second violation and $2,000 for third and subsequent violations. The ordinance also creates a private right of action for the applicant.
Although the ordinance goes into effect on January 1, 2017, penalties cannot be assessed until July 1, 2017.
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Prohibition In Seeking Additional Document To Confirm Ability To Work (SB 1001)
SB 1001 prohibits employers from requesting more or different documents than are required under federal immigration law, to refuse to honor documents tendered that on their face reasonably appear to be genuine, to refuse to honor documents or work authorization based upon the specific status or term of status that accompanies the authorization to work, or to re-investigate or re-verify an incumbent employee's authorization to work.
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Minimum Wage Increase
As of January 1, 2017,
the minimum wage for companies with 26 or more employees will increase to $10.50 per hour.
Minimum wage for employers with 25 or fewer employees remains at $10.00 per hour.
The following cities will also increase minimum wage:
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CITY
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2017 MINIMUM WAGE HOURLY RATES
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Berkeley
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$12.53 (current)
$13.75 (effective October 1, 2017)
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Cupertino
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$12.00 (effective January 1, 2017)
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El Cerrito
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$12.25 (effective January 1, 2017)
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Emeryville
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Employers with 55 or fewer employees:
$13.00 (current)
$14.00 (effective July 1, 2017)
Employers with 56 or more employees:
$14.82 (current)
$15.20 (estimated to go into effect on July 1, 2017 based on CPI increase)
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Los Altos
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$12.00 (effective January 1, 2017)
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Los Angeles
and unincorporated areas of Los Angeles County
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Employers with 25 or fewer employees:
$10.00 (current)
$10.50 (effective July 1, 2017)
Employers with 26 or more employees:
$10.50 (current)
$12.00 (effective July 1, 2017)
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Pasadena
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Employers with 25 or fewer employees:
$10.00 (current)
$10.50 (effective July 1, 2017)
Employers with 26 or more employees:
$10.50 (current)
$12.00 (effective July 1, 2017)
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Mountain View
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$13.00 (January 1, 2017)
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Oakland
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$12.86 (January 1, 2017)
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Palo Alto
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$12.00 (January 1, 2017)
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Richmond
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$12.30 (effective January 1, 2017)
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San Diego
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$11.50 (effective January 1, 2017)
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San Jose
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$10.50 (effective January 1, 2017)
$12.00 (effective July 1, 2017)
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Santa Clara
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$11.10 (effective January 1, 2017)
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San Francisco
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$13.00 (current)
$14.00 (effective July 1, 2017)
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Santa Monica
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Employers with 25 or fewer employees:
$10.00 (current)
$10.50 (effective July 1, 2017)
Employers with 26 or more employees:
$10.50 (current)
$12.00 (effective July 1, 2017)
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Sunnyvale
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$13.00 (effective January 1, 2017)
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Overtime for Agricultural Workers (AB 1066):
Known as the Phase-In Overtime for Agricultural Workers Act of 2016, AB 1066 requires overtime compensation to be paid to agricultural workers in gradual phases. First, effective January 1, 2017, agricultural workers must be provided one day's rest. Previously, agricultural workers were exempt from Labor Code section 551 and 552 which required one day's rest in seven days or the prohibition of working not more than six days in seven days. However, Labor Code section 556 still exempts employers from providing such a day of rest "when the total hours of employment do not exceed 30 hours in any week or six hours in any one day thereof."
The core purpose of the Act is to implement the phase-in of overtime compensation for agricultural workers in the same manner as all other hourly employees. Currently, agricultural workers are eligible for overtime pay only after 10 hours of work in a day or 60 hours in a week. The standard for most other hourly employees is overtime after 8 hours per day, 40 hours per week, and for the first 8 hours on the seventh consecutive day of work; plus double time after 12 hours per day, and after 8 hours on the seventh consecutive day of work. The phase-in will begin in 2019 and will gradually decrease the daily and weekly hours that an agricultural worker must work to receive overtime pay, to achieve the eight hours in a work day and 40 hours in a work week by 2022.
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Itemized Wage Statements (AB 2535)
AB 2535 clarifies Labor Code section 226, which details the minimum information required on an itemized wage statement. Employers no longer have to include hours worked for any employee who is exempt from minimum wage and overtime requirements under the applicable IWC Wage Orders or under statutes specified in Labor Code Section 226(j).
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Changes to Fair Pay Act
(SB 1063 and AB 1676)
With the passage of SB 1063 and AB 1676,
the requirement of equal pay for substantially similar work expands beyond gender. The changes to the Fair Pay Act prohibits wage inequality based on race and ethnicity and that "prior salary shall not, by itself, justify any disparity in compensation."
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All
Gender Bathroom (AB 1732)
Effective March 1, 2017, businesses are prohibited from labeling any "single-user toilet facility" as either "male" or "female." "Single-user toilet facility" is defined as "a toilet facility with no more than one water closet and one urinal with a locking mechanism controlled by the user."
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Contractual Choice of Law (SB 1241)
This new law prohibits an employer from requiring an employee, who primarily resides and works in California, to agree to adjudicate a claim (in either litigation or arbitration) outside of California or deprive the employee of the substantive protection of California law with respect to a controversy arising in California. The statute allows an employee to void the forum selection and choice-of-law provisions in agreements with their employer, unless the employee was represented by counsel in the negotiation of the agreement. This new law does not apply to existing agreements (only new agreements or modifications or extensions of existing agreements), and only applies if the employee's employment is conditioned on the agreement.
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LEAVE OF ABSENCES AND OTHER BENEFITS
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Notice to Employees of Their Right to Domestic Violence Leave (AB 2377)
Employers with 25 or more employees much inform each employee, at the time of hire and at any time thereafter upon request, of their rights to take protected time off for domestic violence, sexual assault or stalking. The Labor Commissioner will develop a form for this purpose and publish it by July 1, 2017. Employers must comply beginning July 1, 2017 by either using the Department of Labor Standards Enforcement ("DLSE") form, or one of their own that is substantially similar in content and clarity.
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Notification Regarding Earned Income Tax Credit Expanded (AB1847)
Employers who are already required to notify their employees of their eligibility for the federal Earned Income Tax Credit also must notify employees that they may be eligible for the California Earned Income Tax Credit.
Any employer who is subject to, and is required to provide unemployment insurance to employees must also give federal and state EITC notice.
Employers must provide, by handing it directly to the employee or mailing it to the employee's last known address, notification to employees within one week of the employer providing an employee his or her annual wage summary, including but not limited to summaries in the form of a Form 1099 or W-2. A sample Federal EITC and California EITC notice is available by clicking <here>.
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Expanded No Smoking In the Workplace (ABX2-7)
ABX2-7 further expands the prohibition on smoking in a place of employment to include owner-operated businesses and certain work environments, including hotel lobbies, bars and taverns, banquet rooms, warehouse facilities, and employee break rooms.
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Complete Handheld Free Devices While Driving (AB 1785)
The new law requires a complete handheld free use of wireless telephones or communications devices while a driver is operating a vehicle. The phone or device must be mounted on a vehicle's windshield in the same manner a portable Global Positioning System (GPS) is mounted on or affixed to a vehicle's dashboard or center console in a manner that does not hinder the driver's view of the road. The driver's use of hands is limited to activate or deactivate a feature or function of the phone or device with the motion of a single swipe or tap of the driver's finger.
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E-VERIFY RECORDS DISPOSAL
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In April 2017, the United States Citizenship and Immigration Services ("USCIS") must dispose of E-Verify transaction records that are over 10 years old.
Employers and E-Verify Employer Agents with transaction records in E-Verify dated on or before December 31, 2006 must download these records from now through March 31, 2017 in order to have a record of s
uch. For more information on the Historic Records Report, see the
Fact Sheet
and
instructions
to download the report.
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| CALIFORNIA SUPREME COURT UNEQUIVOCALLY PROHIBITS ON-CALL OR ON-DUTY REST PERIODS |
Augustus v. ABM Security Services
(SC S224853)
On December 22, 2016,
the California Supreme Court ruled that California law strictly prohibits on-duty rest periods and requires employers to "relinquish any control over how employees spend their break time, and relieve their employees of all duties - including the obligation that an employee remain on call." This class action lawsuit was filed by ABM security guards, alleging that ABM consistently failed to provide uninterrupted rest periods. ABM employs thousands of security guards at residential, retail office and industrial sites throughout California. ABM required guards to keep their radios and pagers on, remain vigilant and respond when needs arose, such as escorting tenants to parking lots, notifying building managers of mechanical problems and responding to emergency situations - all during their breaks. The Court found that the on-call and on-duty nature of ABM's procedures did not completely relieve employees of their job duties during their rest period because the practice unreasonably interfered with the employees' opportunity to take an uninterrupted rest period. The California Supreme Court affirmed the trial court's summary judgment for the ABM security guards for
$90 million by reversing the Court of Appeal's decision.
Thankfully, the decision included guidance for California employers: "[n]othing in our holding circumscribes an employers' ability to reasonably reschedule a rest period when the need arises." As a limited exception, employers may: (1) provide employees with another rest period to replace the one that was interrupted, or (2) pay the premium set forth in Wage Order 4, subdivision 12(b) and Labor Code Section 226.7, which is one-hour of pay at the employee's regular rate of pay for each day the rest period is missed. These options must not be adopted as a normal or routine practice. If an employer seeks to be exempt from the duty-free rest period, the employer may request specific exemption for the DLSE under Wage Order 4 subdivision 17.
The Court recognized the exception under Wage Order 4, subdivision 11(A) for on-duty meal periods, noting: "[t]hat exception is exceedingly narrow, applying only when (1) the nature of the work prevents an employee from being relieved of all duty' and (2) the employer and employee have agreed, in writing, to the on-duty meal period. Even the employee retains the right to revoke the agreement at any time." (Internal quotes omitted.)
Employers must reevaluate their meal and rest period policies in light of the Augustus decision to ensure those periods are duty-free or otherwise seek an exemption.
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Our Employment Law Legal Team
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Rynn & Janowsky, LLP's employment law legal team is available to assist clients in any employment related matters.
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