It’s the time of year that we try to update you on the new laws affecting employers in the State of California. The legislative session has completed and the Governor has now either signed or vetoed all the bills sent to his desk. Below is an attempted summary of key bills for employees to understand, but is certainly not an exhaustive list:
Bills Effective Immediately Upon Signing:
Supplemental Paid Sick Leave & Small Employer Family Leave Mediation. AB 1867 requires COVID-19 supplemental paid sick leave for workers employed by private businesses of 500 or more employees nationally (and certain health care providers and emergency responders). This bill essentially covers all workers in California who may not be entitled to supplemental paid sick leave covered by the Emergency Paid Sick Leave Act established by the federal Families First Coronavirus Response Act (“FFCRA”).
AB 1867 also requires the Department of Fair Employment and Housing (DFEH) to create a small employer family leave mediation program, authorizing small employers and their employees to request mediation through the DFEH’s dispute resolution division within a specified timeframe. Under the program, employers or employees may require DFEH mediation if: (1) the DFEH issues a right-to-sue notice based on a DFEH complaint that is related to family leave and (2) the named employer has between 5-19 employees. AB 1867 prohibits employees from pursuing civil actions until the mediation is complete, and tolls the statute of limitations, including for additional related claims, from receipt of a request to participate in the program until the mediation is complete.
Worker Classification: Employees and Independent Contractors. AB 2257 recasts and extensively revises the provisions added by AB 5 of 2019, to exempt bona fide business-to-business contracting relationships from the law’s application, as well as to add industry-specific exemptions (including proofers and record directors, persons who provide underwriting inspection, home inspectors, and individuals who contract for the purpose of providing services at a single-engagement event), and clarifies existing industry-specific exemptions.
Bills Effective January 1, 2021:
Settlement Agreements: No-hire Provisions. Existing law prohibits no-hire provisions in settlement agreements unless the employer has determined in good faith that the aggrieved person engaged in sexual harassment or sexual assault. AB 2143 revises that law to require that the employee has filed the claim in good faith for the prohibition to apply, and that the employer has documented the determination of sexual assault or sexual harassment before the aggrieved person filed the claim. AB 2143 also expands the exceptions to the no-hire provision prohibition to include a determination that the aggrieved person engaged in any criminal conduct, in addition to the existing sexual harassment and sexual assault exceptions.
New Mandated COVID-19 Reporting. AB 685 requires employers, within one business day of receiving notice of potential exposure to COVID-19 in the workplace, to: (1) provide written notice to all employees, the employers of subcontracted employees, and exclusive representatives who were on the premises at the same worksite, (2) provide all employees who may have been exposed and their exclusive representative with information regarding COVID-19-related benefits, including, but not limited to, workers’ compensation, COVID-19-related leave, company sick leave, state-mandated leave, or supplemental sick leave, and (3) notify all employees, the employers of subcontracted employees, and the exclusive representative on the disinfection and safety plan the employer intends to implement.
DLSE Complaints Statute of Limitations. AB 1947 extends the deadline for filing Labor Commissioner complaints from six months to one year after a violation. The bill also authorizes courts to award reasonable attorney’s fees to plaintiffs who bring a successful whistleblower action.
CFRA Expansion. SB 1383 expands the California Family Rights Act to require businesses with as few as five employees (eliminating the geographical restrictions) to provide 12 weeks of mandatory family leave per year. The bill also expands family care and medical leave to include leave (1) to care for grandparents, grandchildren, siblings, domestic partners with a serious health condition (in addition to existing leave to care for a parent or spouse), and (2) because of a qualifying exigency related to covered active duty or call to covered active duty of an employee’s spouse, domestic partner, child, or parent in the US Armed forces. SB 1383 also expands the definition of child to include the child of a domestic partner. Finally, SB 1383 eliminates the previous carve out that existed for certain highly paid or key employees.
Corporations: Boards of Directors. Building upon SB 826 of 2018, which required minimum numbers of female directors on boards, SB 979 requires publicly held corporations headquartered in California to include at least one person from an “underrepresented community” on their boards by the end of 2021, and two to three, depending on the size of the board, by the end of 2022. The bill defines a director from an “underrepresented community” as an individual who self-identifies as Black, African American, Hispanic, Latino, Asian, Pacific Islander, Native American, Native Hawaiian, or Alaska Native, or who self-identifies as gay, lesbian, bisexual, or transgender. Violations of these provisions could subject a corporation to a fine of $100,000 for the violation and $300,000 for subsequent violations.
As mentioned earlier, there are many additional employment laws (and even more non-employment laws) that were signed by the Governor this year. However, we believe these are likely to be most relevant to your business practices. Should you have any questions about these new laws, or any other legal needs, please reach out to me or one of our FLAS team.
DISCLAIMER: This Advisor is one of a series of business, real estate, employment, estate planning and tax bulletins prepared by the attorneys at Fauver, Large, Archbald & Spray, LLP. This Advisor is not exhaustive, nor is it legal advice. You should discuss your particular situation with us or with your own attorney. Our legal representation is only undertaken through a written engagement letter and not by the distribution or use of this Advisor.