During the course of the legislative 2015 regular session, California's Legislature sent over 930 bills to the Governor. Of these, Governor Brown signed more than 800 bills sent to him. In the mix were a number of significant additions to the existing labor laws in California.
Labor Laws In California Continue to Grow - and Change - for 2016
While a great number of the bills signed into law will have some impact on businesses in California, there are a few that are worth noting for the majority of private-sector employers.
The new laws highlighted here take effect on January 1, 2016, with the exception being the so-called "urgency" laws that already went into effect as of January 1, 2015.
The Most Significant New Labor Laws in California
A number of these are laws with the greatest implications for most or all California employers:
1. AB 1522 In 2014 the state passed the Healthy Workplace Healthy Family Act of 2014, which established mandatory paid sick leave (PSL) obligations for most California employers. The provisions of this new law went into effect on July 1, 2015. Since there are often fixes that have to be made to an original law of this scope, an urgency enactment was passed and became effective July 13, 2015. This included the following requirements:
- An employee must work for the same employer for 30 or more days within a year of the commencement of employment to be eligible to use PSL.
- It allows for alternative accrual methods for all leave banks.
- Employers must "Grandfather" in leave banks existing as of January 1, 2015.
- Employers with unlimited or undefined leave banks are allowed to indicate "unlimited" on the employee's itemized wage statement.
- It allows for employers to calculate the rate of pay for employees using any of three methods.
2. SB 358 California's equal pay statute, first enacted in 1949, was significantly modified to lower the burden of proof for plaintiff's claims, to greatly increase the burden of proof for an employer's defenses, and to allow employees to ask other employees about the amount of their wages for the purpose of ascertaining whether there may be a factual basis for an equal pay claim.
3. AB 1506 The Labor Code's Private Attorneys General Act of 2004 (PAGA) has been amended to provide an employer with a limited right to cure a violation of failing to provide its employees with a wage statement containing the inclusive dates of the pay period and the name and address of the legal entity that is the employer.
4. AB 987 Employers are prohibited from retaliating or otherwise discriminating against an employee for requesting accommodation of his or her disability or religious beliefs, regardless of whether the accommodation request was ultimately granted.
5. SB 588 The Labor Commissioner is authorized to file a lien on real estate, or a levy on an employer's property, or impose a stop order on an employer's business in order to assist an employee in collecting unpaid wages where there is a judgment against the employer. Any employer, or individual acting on behalf of an employer, who violates any provision regulating minimum wages or hours and days of work in any order of the Industrial Welfare Commission, or who violates other related provisions of law may be held liable as the employer for such violation. A bond of up to $150,000 may be required of an employer who does not promptly pay a judgment for unpaid wages.
6. AB 970 The Labor Commissioner will have the authority to issue a citation to enforce local minimum wage and overtime laws, including against an employer or person acting on behalf of an employer for violations of existing law related to reimbursements for expenses.
7. AB 1245 Beginning on January 1, 2017, an employer with 10 or more employees must file all reports and returns electronically, and remit all contributions for unemployment insurance premiums by electronic funds transfer, except as provided. Beginning on January 1, 2018, these electronic filing and fund transfer requirements will be extended to all employers. The bill would authorize the granting of a waiver from these requirements. The bill would impose a penalty of $50 on those employers who fail to file a quarterly return electronically without good cause.
8. AB 1513 The statutory requirements for piece-rate compensation are clarified, and an affirmative defense and safe harbor is provided for employers who, by December 15, 2016, fully compensate their specified employees for all under-compensated or uncompensated rest periods, recovery periods, or unproductive time between July 1, 2012 and December 31, 2015.
9. SB 579 The Family School Partnership Act is expanded to broaden the authorized reasons for which an employee can take job-protected time off of work without the fear of discrimination or discharge by allowing workers to take time off work to: (1) find, enroll, or re-enroll his or her child in a school or with a licensed child care provider, and (2) to address a child care provider or school emergency, as defined.
10. AB 359 Certain grocery stores that are sold to another entity will have specified obligations to retain grocery workers for a limited period of time.
11. AB 622 The definition of an "unlawful employment practice" is expanded to prohibit an employer or any other person or entity from using the E-Verify system at a time or in a manner not required by federal law, or not authorized by a federal agency memorandum of understanding, to check the employment authorization status of an existing employee or an applicant who has not received an offer of employment. There is a civil penalty of up to $10,000 for each violation of the provisions of the bill.
What California Employers Can Do to Prepare
- Update employee handbooks and your company's policies and procedures to reflect the changes in the labor laws in California.
- Verify and finalize any updates concerning paid sick leave modifications and the basis for compensating similar positions since these can be reviewed as part of an equal pay claim.
- Advise supervisors of the new laws, their responsibility to know them, and their responsibilities for administering policies that conform with all relevant labor laws in California.
- Contact employment counsel with any questions about the new laws.
Accuchex is Here to Help California Employers and HR Managers
If you have questions regarding California labor law requirements, or other HR issues and practices, let us 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.