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Employment Law Updates Impact California Employers

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TWO IMPORTANT NEW BILLS IMPACT CALIFORNIA EMPLOYERS

Just before the October 15th deadline, Governor Brown signed many new pieces of legislation, many of which will have significant impact on California small businesses. We highlight two of the recent bills here.

The first bill, the “New Parent Leave Act” mandates that employers with 20 or more employees provide 12 weeks of protected time off; the second bill prohibits employers from making any inquiry about an applicant’s prior salary history during the pre-hire process. Both bills take effect on January 1, 2018.



NEW PARENT LEAVE ACT

Currently, California employers are mandated to provide time off in the form of Paid Sick Leave of 3 days/24 hours (more if you are in Los Angeles) along with several other legally required leaves of absences (some depending on the size of the workforce). Now, employers with as few as 20 employees will be required to provide 12 weeks of baby bonding leave to new parent/employees. The parental leave is to permit the employee to bond with a new child within one year of the child’s birth, adoption, or foster care placement.

This bill mirrors some of the eligibility requirements of the California Family Rights Act and the Federal Family and Medical Care Leave Act (which applies to companies with 50 or more employees). To be eligible for the leave, an employee must have:
  • Worked more than 12 months with the employer;
  • Worked at least 1,250 hours during the prior 12-month period; and
  • Work at a worksite where there is at least 20 employees within a 75 mile radius.

Combined with other protected leaves (e.g. 4 months of Pregnancy Disability Leave), this new leave entitlement could result in employers having to grant up to seven months of protected leave to an eligible employee.

If both parents are employed by the same company, and seek leave for the same birth, adoption, or foster care placement, the amount of time off for both parents is limited to a total 12 weeks – not 12 weeks for each parent. The bill would authorize the employer to grant simultaneous leave to these parents.

In addition, employers will be required to maintain and pay for group health insurance coverage for an employee who takes leave under this new law on the same terms and conditions as if the employee was actively working (as is the current requirement for employees taking a Pregnancy Disability Leave of Absence). However, an employer may seek to recoup the cost of the insurance premium paid by the employer for maintaining coverage for the employee under the group health plan, if both of the following conditions occur:

  • The employee fails to return from leave after the period of leave to which the employee is entitled has expired; and
  • The failure of the employee to return from leave is for a reason other than the continuation, recurrence, or onset of a serious health condition or other circumstances beyond the control of the employee.

If an employer fails to provide a requested leave of absence, under this law, it could be deemed to be an “unlawful employment practice” subjecting the employer to litigation if the employee alleges their employer:

  •  Did not provide the 12 weeks of protected leave;
  •  Failed to return the employee to the same or comparable position;
  •  Failed to maintain benefits while the employee was out on leave; or
  • Took any adverse employment action (e.g. termination, demotion, reduction in hours, wages or other terms and conditions of employment) against the employee for taking the leave.

As with most other leave entitlements laws, this bill provides that employers may not refuse to hire, or discharge, suspend, discriminate or take any other adverse action against an individual for exercising their right to parental leave or for giving information or testimony as to his or her own parental leave, or another person’s parental leave, in an inquiry or proceeding related to rights guaranteed under this bill.

Additionally employers are prohibiting from interfering with, restraining, or denying the exercise of, or the attempt to exercise, any right provided under this bill.

The Department of Fair Employment and Housing (DFEH) has been tasked to create a parental leave mediation pilot program. Under the pilot program, if an employee files a charge of discrimination with the DFEH and seeks a “right to sue” notice, within 60 days of receipt of such notice an employer may request all parties participate in the DFEH’s Mediation Division Program. If the employer makes such a request, the employee may not pursue any civil action until the mediation is complete.

What Should I Do Now?
  • Update leave of absence policies and procedures to ensure employees time off under SB 63;
  • Educate managers and supervisors on the new leave entitlement;
  • Provide information to employees about their rights under the new law.


SALARY HISTORY INQUIRES PROHIBITED

The second bill signed by Governor Brown (AB 168), which applies to all employers regardless of size, prevents employers from asking an applicant’s salary history and from relying on salary history information as a factor in determining what salary to offer an applicant.

Currently under the California Fair Pay Act, prior salary may not be used to justify any pay differential. Under the new legislation, employers are expressly prohibited not only from making any inquiry into an applicant’s salary history, but also from relying on an applicant’s salary history as a factor in determining whether to offer employment or determining what salary to offer.

Employers will be prohibited from seeking salary history information (including compensation and benefits data) about an applicant, either personally or through an agent. An exception exists for salary history information that is disclosable to the public pursuant to federal or state disclosure laws such as the California Public Records Act and the federal Freedom of Information Act.

Further, upon reasonable request, employers must provide an applicant with the pay scale for the position being sought. The law does not define “pay scale.”

While employers may not inquire about an applicant’s salary history, an applicant may still, voluntarily and without prompting, disclose his or her salary history information to a prospective employer. Although the employer may not consider that information in determining whether or not to hire the applicant, the employer may consider or rely on that information in determining his or her salary. However, it is important to remember that the Labor Code disallows the applicant’s prior salary, by itself, to justify any disparity in compensation.

What Should I Do Now?
  • Review and revise employment applications to remove any request for salary history;
  • Train hiring managers and supervisors to eliminate questions about salary history during the interview process;
  • Educate hiring managers and supervisors on what information to provide if an applicant seeks information about the pay scale and/or voluntarily discloses their salary history;
  • Upon reasonable request, provide pay scale information to applicants

Any violation of the provisions in AB 168 could be pursued under other sections of the Labor Code, specifically including the Private Attorneys General Act (PAGA).

This Special Bulletin is intended as a brief summary of employment law. While every effort has been made to ensure the accuracy of the information contained herein, it is not intended to serve as “legal advice,” or to establish an attorney-client relationship. If additional information is needed on any of the topics contained herein, please contact our office. All rights reserved. ©2017.