A new year and a new quarter brings a great deal to do and take care of. And it’s easy to lose track of new laws that can impact your business. 2020 is no different.
The 2019 California legislative session brought us a number of significant employment law changes and additions. Here is a brief overview and summary of some key labor laws that can fundamentally impact your business.
Worker Classification
The California Labor Code has been radically changed regarding classification of workers as independent contractors or employees.
In 2018, the California Supreme Court’s decision in Dynamex Operations West, Inc. v. Superior Court of Los Angeles introduced California businesses to the ABC Test. Under Dynamex's ABC Test, all workers in the state are presumed to be employees unless the hiring entity can prove that:
(a) the worker is free from the control and direction of the hirer in connection with the performance of the work;
(b) the worker performs work that is outside the usual course of the hiring entity's business; and
(c) the worker is customarily engaged in an independently established trade, business, or occupation.
The following year In 2019, the California General Assembly introduced Assembly Bill 5, which codifies the presumption, burden and ABC Test in the Dynamex court decision and expands them to all aspects of the Labor Code including workers' compensation and unemployment insurance.
Subsequently, AB 5 was then signed into law by the Governor in September 2019 and is now effective as of January 1, 2020.
According to an article from the firm Frankfurt Kurnit Klein & Selz additional changes may be forthcoming,
“Several lawsuits have been filed challenging AB 5 and more are undoubtedly in the works. For example, on December 30th—two days before AB 5 was scheduled to take effect, Uber and Postmates filed a lawsuit alleging, among other things, that AB 5 is unconstitutional. And, on December 31st, one day before AB 5's effective date, a judge issued a temporary restraining order preventing the application of AB 5 to commercial truck drivers.
In the meantime, anyone that employs people in California whose work even arguably touches on its core business (prong B of the ABC Test) should reevaluate and confirm that the arrangement passes the ABC Test or qualifies for one of the exemptions.”
Workplace Discrimination
Because of the prevalence of employee labor claims and lawsuits in California, it is critical to stay abreast of laws and regulations regarding discrimination in the workplace.
Accommodating Lactation at Work
California SB 142 expands the state's mandatory lactation accommodations by requiring that businesses provide a "reasonable break time" to express breast milk each time the employee must do so and requires that companies provide "adequate space" other than a bathroom stall or office closet to express milk.
This space must be close to the employee's work area, have electrical outlets, and has a place to sit. In addition, employers cannot discriminate or retaliate against employees for exercising their workplace lactation rights or fail to provide either the time or the adequate space for lactation breaks as required under current law.
Racial Discrimination and Hair
SB 188 prohibits discriminating against a person in the workplace based on hairstyle traits that are normally associated with race such as hair texture and styles. The law is known as the CROWN ACT (Create a Respectful and Open Workplace for Natural Hair) and extends protection for both categories under the FEHA and the California Education Code.
Sexual Harassment Training
For companies with five or more employees, California SB 778 extends the deadline to provide two hours of sexual harassment training for supervisory employees every two years and one hour of training for non-supervisory employees every one year. The new deadline is January 1, 2021. Employers who provided training in 2019 are not required to provide additional training for two more years.
Wage Rules and Paid Family Leave
Minimum Wage
The state minimum wage increased in California to $12 per hour as of January 1, 2020 for companies with 25 or fewer employees, and up to $13 per hour for companies with 26 or more employees.
Because the minimum wage is higher in at least 33 municipalities throughout the state, employers should also check the minimum wages set by various cities to make sure they are in compliance by visiting: https://www.govdocs.com/2020-minimum-wage-rates-for-california-cities/
Paid Family Leave
The SB 83 increases Paid Family Leave (PFL) from six to eight weeks. According to a post from JDSupra.com,
“An important thing to keep in mind is that the PFL program is not a leave entitlement, unlike California's paid sick leave law, the Family and Medical Leave Act and the California Family Rights Act, which all entitle eligible employees to leave for various purposes. Rather, employees who are eligible to take leave through paid sick leave or under FMLA/CFRA, or who are otherwise granted leave for the above-listed reasons by the employer, are then eligible to apply for wage replacement benefits through PFL.”
Your Partner for HR Compliance
In addition to HR management best practices and labor law compliance, we can offer online payroll software for your payroll process - a great option for staying in compliance on the payroll front.
Another "best practice" is to consider outsourcing.
This can be done by simply outsourcing one process such as payroll. However, with a full-service provider such as Accuchex, you also have additional options for outsourcing as well.
Let Accuchex help you in managing your HR needs, payroll processes, and staying on top of compliance demands. Get your Free Download: Payroll Outsourcing Guide to help you make an informed decision or call Accuchex Payroll Management Services at 877-422-2824.
