Yes, it’s that time of year… time to get ready for the usual barrage of changes in employment law that take effect on January 1, 2025.
Below is a brief summary of the more significant changes for employers to review and take into consideration while updating handbooks and training programs to ensure continuing compliance with the ever changing laws and regulations, many of which expand worker protection.
NEW WHISTLEBLOWER NOTICE POSTER REQUIREMENT
The California Labor Commissioner had been tasked with developing a model notice list of employee rights and responsibilities under existing Whistleblower laws, pursuant to Assembly Bill (AB 2299). While the Labor Commissioner did previously issue a sample notice it included a disclaimer that the Labor Commissioner did not guarantee its posting fulfilled the requirements of California law…. Now, the Labor Commissioner has published an updated notice and confirmed this notice meets the requirements of Labor Code section 1102.8(a)-(b). This notice must be posted by January 1, 2025.
NEW MINIMUM WAGE AND SALARY THRESHOLD
Starting on January 1, the statewide minimum wage will increase to $16.50 per hour, and the threshold for exempt salaried employees will increase to $68,640 annually. With the increased exempt salary threshold, employers should review their compensation levels to ensure that exempt employees are paid at least $68,640 annually; if not, they would need to have an increase in their compensation amount to maintain their exempt status.
Employers are also reminded to review any local and industry specific wage requirements to ensure compliance.
INCREASED SALARY THRESHOLDS FOR COMPUTER PROFESSIONALS
Certain computer software employees are exempt from overtime requirements under Labor Code section 515.5, provided they meet specific salary thresholds. For 2025, the Department of Industrial Relations has adjusted these thresholds as follows:
• Minimum hourly rate: $56.97 (up from $55.58 in 2024)
• Minimum monthly salary: $9,888.13 (up from $9,646.96 in 2024)
• Minimum annual salary: $118,657.43 (up from $115,763.35 in 2024)
Employers should review their compensation plans to ensure compliance with these updated rates.
EXPANDED ANTI-DISCRIMINATION LAWS
Discrimination Based on Hair Traits (AB1815)
Previously, California enacted the CROWN (Creating a Respectful and Open Workplace for Natural Hair) Act, which prohibits race-based discrimination pertaining to an employee’s hair. The new legislation amends the definition of “race” to be “inclusive of traits associated with race, including, but not limited to, hair texture and protective hairstyles.” The term “protective hairstyles” has also been revised to include “but is not limited to such hairstyles as braids, locs, and twists.”
Intersectionality of Protected Characteristics (SB 1137)
California has become the first state to prohibit discrimination on the basis of the intersection, or combination of two or more protected characteristics (e.g., race, sex, age, disability, etc.). The law defines “intersectionality” as “an analytical framework that sets forth that different forms of inequality operate together, exacerbate each other, and can result in amplified forms of prejudice and harm.” Notably, this intersectionality concept is one recently recognized by the US Equal Employment Opportunity Commission’s latest enforcement guidance on harassment in the workplace.
EXPANDED PAID SICK LEAVE RIGHTS (AB 2499)
Under existing law, protections for “safe time” absences due to domestic violence, sexual assault, or stalking have been strengthened under the Fair Employment and Housing Act (“FEHA”). The new law includes additional rights for employees supporting family members who are crime victims.
The Act defines “qualifying act of violence” as any of the following, regardless of whether it results in an arrest, prosecution, or conviction: (a) domestic violence; (b) sexual assault; (c) stalking; and (d) an act, conduct, or pattern of conduct that includes any of the following:
(i) in which an individual causes bodily injury or death to another individual.
(ii) in which an individual exhibits, draws, brandishes, or uses a firearm, or other dangerous weapon, with respect to another individual.
(iii) in which an individual uses or makes a reasonably perceived or actual threat to use, force against another individual to cause physical injury or death.
AB 2499 also covers the anti-discrimination protections for employees involved in jury duty, court appearances, or are victims of a crime to fall within the scope of the Fair Employment and Housing Act which strengthens the protections for employees from discrimination and adds leave eligibility for employees supporting family members who are crime victims.
Notable changes:
- Broadened Leave Rights for Family Members: Employers with over 25 employees cannot discriminate or retaliate against workers taking leave to support family members who are crime victims.
- Annual Notice Requirement: Employers must notify employees of these rights upon hire and annually.
- Model Form: Requires the California Civil Rights Department to develop and post a model form by July 1, 2025, titled “Survivors of Violence and Family Members of Victims Right to Leave and Accommodations,” that sets forth the rights and duties of employers and employees under this Section and that employers may use to comply with their notice requirements.
NO USE OF VACATION PRIOR TO OBTAINING PAID FAMILY LEAVE BENEFITS (AB 2123)
A significant change for employers is that as of January 1, employers cannot require employees to use accrued vacation before accessing California’s Paid Family Leave (“PFL”) benefits.
FREELANCE WORKER PROTECTION ACT
The concept of independent contractors has long been disfavored in California. The new Freelance Workers Protection Act provides additional protections to those workers who are retained as “freelance workers.” The Act sets minimum requirements for retaining independent contractors such as, the requirement to provide the Independent Contractor with a written agreement if their services total $250.00 or more (either at one time or over an aggregated 120-day look-back). The contract must address compensation terms, deadlines, and service expectations to ensure clarity and protect workers from delayed payments or demands for additional work beyond the original agreement without extra pay.
Freelancers must be paid on the agreed upon date or, if unspecified, within 30 days of completing the work. Contracts must be retained for at least four years.
Excluded from the Act is when individuals hire services “for personal benefit of themselves, their family members, or their homestead.”
Penalties for Failure to Comply:
- The requirements of the Act are non-waivable, and non-compliance could result in a private civil action or prosecution.
- Failure to provide a written contract prior to work even after the freelancer requests it, will result in a penalty of $1,000.
- Failure to pay the freelancer by the time required will result in damages up to twice the unpaid amount.
- Retaliation against the freelancers for invoking rights under the Act results in damages equal to the value of the contract or the work performed, whichever is greater.
RESTRICTIONS ON DRIVER’S LICENSE REQUIREMENTS IN JOB POSTINGS (SB 1100)
Starting on January 1, employers may only require a driver’s license if it is essential to the job function and alternative transportation is not feasible. This change requires employers to carefully assess job postings and policies involving driver’s licenses.
WORKERS’ COMPENSATION NOTICE REQUIREMENTS (AB 1870)
California employers are required to inform employees about their right to consult an attorney for advice on workers’ compensation rights, reinforcing transparency in the workers’ compensation process. Employers should contact their workers compensation insurance carrier for updated forms and notices to comply with this new requirement.
BAN ON MANDATORY WORK MEETINGS COVERING RELIGION AND POLITICS (SB 399)
The “California Worker Freedom from Employer Intimidation Act” goes into effect, which bans mandatory attendance at meetings which include discussions covering religious or political opinions, including union organizing. This law does not apply to mandatory training to comply with an employer’s legal obligations, including obligations under civil rights laws (such as discrimination and harassment prevention training) and occupational safety and health laws.
This Newsletter 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. ©2024.