As we prepare for cooler weather, and the upcoming holiday season, we also need to prepare for the many new employment laws that will take effect January 1, 2021.
In the final days before the deadline to sign or veto proposed legislation, Governor Newsom was busy signing many new bills affecting California businesses. We addressed some of these new laws in prior newsletters (COVID-19 reporting requirements, revisions to AB5, and changes to the CFRA). Below is a summary of some additional legislative changes impacting California employers. Most of the new laws become effective January 1, 2021; others have been deemed “urgency” legislation and are effective immediately.
SMALL EMPLOYER FAMILY LEAVE MEDIATION PROJECT
As explained in our prior newsletter, the California Family Rights Act (CFRA) has been amended to cover employers with 5 or more employees. CFRA now also differs from the Federal Family and Medical Care Leave Act not only in terms of the employers who are now covered but also as to the expanded scope of the definition of “family member” and the elimination of the exemption for when both parents work for the same employer for “baby bonding” time off.
Because small businesses are now covered by CFRA, the new law (AB 1867) has imposed a requirement upon the Department of Fair Employment and Housing (DFEH) to create a small-employer family leave mediation pilot program to enable employees and employers to request mediation through the DFEH’s dispute resolution services within a specified time period to address compliance concerns, the program would permit employers or employees to require mediation under the following circumstances: (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. If mediation is pursued, the employee is prohibited from pursuing a civil action until the mediation is complete. Participating in mediation also “tolls” (suspends) the statute of limitations until such time as the mediation has been completed.
This program may be an opportunity to timely and cost effectively resolve employee complaints without the need for time consuming and expensive litigation. Time will tell.
KIN CARE & PAID SICK LEAVE ENTITLEMENTS
California law presently provides that employees are entitled to use up to one half of their annual accrual of paid sick leave for “kin care”. The “kin” included are the same “family members” for whom an employee may take paid sick leave: a child, parent, spouse, registered domestic partner, grandparents, grandchild, and sibling. The “care” that is included is time off for the diagnosis, care, or treatment of an existing health condition of, or preventive care for, an employee’s family member.
Beginning January 1, 2021, changes to the “kin care” law provide that the designation of the sick leave taken for the reasons specified shall be made at the sole discretion of the employee – not the employer. The employee can elect to designate or not designate the time taken off as “kin care” so that the employee controls the use of their paid sick leave allotted time. (AB 2017)
NO RE-HIRE CLAUSES IN SETTLEMENT AGREEMENTS AMENDED
Last year, legislation was signed that employment related settlement agreements could not contain “no-rehire” clauses. This restriction was limited to situations where an employee filed a lawsuit or filed a complaint with a government agency. There was an exception to the prohibition where the employer had made a good-faith determination that the former employee had engaged in sexual harassment or assault and in those instances any settlement agreement could include a “no-rehire” provision.
Now, with an amendment to Code of Civil Procedure 1002.5, the exception has been revised to provide that a no-rehire clause is permissible in those instances where the employer’s determination of sexual assault or sexual harassment was documented before the aggrieved person filed the claim.
In addition, the bill expanded the exception to also include instances in which the employer made a good-faith determination that the former employee engaged in any criminal conduct. (AB 2143)
VICTIM OF CRIMES TIME OFF EXPANDED
Under current law, employers are required to provide an employee, who is a victim of “domestic violence, sexual assault, or stalking,” time off to obtain or attempt to obtain relief to help ensure the health, safety, or welfare of the victim or the victim’s child.
The law has been amended so that victims may take time off not only for domestic violence, sexual assault, or stalking but also for any “or other crime or abuse” “that caused physical injury or that caused mental injury and a threat of physical injury” and for “a person whose immediate family member is deceased as the direct result of the crime.” Employees may use any available time off benefits to cover the time off (e.g. paid sick leave, vacation or PTO).
In addition, the revision to the Labor Code includes an expansion of the prohibition by employers with 25 or more employees from discharging, discriminating, or retaliating against an employee who is a “victim” for taking off work to seek medical attention for injuries caused by crime or abuse, to obtain services from prescribed entities as a result of the crime or abuse, to obtain psychological counseling or mental health services related to an experience of crime or abuse, or to participate in safety planning and take other actions to increase safety from future crime or abuse.
Employees are still required to verify their need for the leave, but this can be done by providing a police report or other documentation certifying that the absence was due to a reason authorized under Labor Code Section 230.1 (AB 2992).
LABOR COMMISSIONER COMPLAINTS STATUTE OF LIMITATIONS EXTENDED
Currently, employees have 6 months from the date of an alleged occurrence to file a complaint with the Labor Commissioner (Labor Code § 98.7). Such claims include allegations of retaliation or discrimination in violation of any law enforced by the Labor Commissioner. If a violation is found to exist, the Labor Commissioner may order the employer to reinstate the employee, and pay back wages or lost benefits, or provide some other remedy. The deadline has now been extended with the amendment to Labor Code §98.7 to one year. (AB 1947)
ATTORNEYS FEES RECOVERABLE UNDER WHISTLEBLOWER STATUTE
California Labor Code Section1102.5 is California’s general whistleblower statute used by employees to sue for retaliation and wrongful termination. To be a whistleblower, the employee has:
(1) either disclosed a violation of law (including state or federal statutes, or local, state, or federal rules or regulations to a governmental or law enforcement agency, or internally to a person with authority over the employee or to another employee with authority to investigate, discover, or correct the violation or noncompliance or
(2) provided information regarding a violation of law to or testifying before any public body conducting an investigation, hearing, or inquiry.
With this definition, it includes just about any complaint made or believed to have been made by an employee internally or externally alleging activity reasonably believed to be unlawful.
Currently, a successful plaintiff may be entitled to reinstatement with back pay and benefits (Labor Code section 98.6(b)), the recovery of actual damages (Labor Code section 1105), and/or the employer may be required to pay a civil penalty of $10,000 for each violation (Labor Code section 1102.5(f), 98.6(b)(3)). Interestingly, while a Plaintiff could recover monetary damages, they were not entitled to an award of attorneys’ fees.
Now, with the passage of AB 1947 the Code is amended to provide that a successful plaintiff may now seek to have a Court award reasonable attorney’s fees. Based on the potential for recovery of attorney’s fees, it is likely that there will be more claims filed under section 1102.5.
EDD WORK SHARING PROGRAM GETS RE-BOOT
In response to the significant number of employees who have been impacted by COVID-19 and lost their jobs, the Governor signed into law AB 1731 entitled “Unemployment Insurance; work sharing plans” which takes effect immediately and remains in effect through January 1, 2024 unless extended.
AB 1731 adds an expedited process for employers to apply for and participate in California’s work sharing program. The Work Sharing Program benefits employees whose hours were reduced allowing them to receive unemployment insurance benefits and maintain their current employment, and any health and retirement benefits.
The process for the EDD work sharing program in the past was cumbersome and many employers choose not to utilize the program for that reason. The new process is designed to encourage employers to utilize the work sharing program and provides a timely method for the submission and approval of application.
The new process as contained in the Unemployment Insurance Code at Section 1279.7 provides that the EDD shall accept a work sharing plan application submitted electronically by an employer and the EDD shall create a portal on its internet website for the receipt of these applications.
The new process provides that any work sharing plan application submitted between September 15, 2020, and September 1, 2023, upon approval, shall be effective for one year, unless a shorter plan is requested by the employer and approved by the director.
The EDD shall either mail or through the online portal provide a claim packet to the employer for each participating employee within five business days following approval of the application. After the participating employer and employees complete and submit the documents in the claim packet, the EDD shall establish an unemployment insurance claim for the employee.
MILITARY EXIGENCIES LEAVE BENEFITS EXPANDED
California’s Paid Family Leave (“PFL”) program provides partial wage replacement benefits to individuals who take time off work to care for a seriously ill child, spouse, parent, or domestic partner, or to bond with a newborn, newly adopted or newly placed foster child.
The PFL program was previously expanded to provide the benefits for time off to be with a family member who was being deployed on active duty in connection with a military exigency. New legislation expands the definition of “military member” to include a child, spouse, domestic partner, or parent of the employee, where the military member is on covered active duty or is called to active duty in the Armed Forces of the United States. (AB 2399).
“BAN THE BOX” FAIR CHANCE REGULATIONS UPDATED
California’s Fair Employment and Housing Council has published updated regulations governing the use of criminal background checks in employment.
The amended regulations, which were effective on October 1, 2020, expand the definition of “applicant” to include individuals who are conditionally offered employment but begin working while an employer undertakes a post-offer consideration of the individual’s criminal history.
The regulations state that “[a]n employer cannot evade the requirements” of the Fair Chance Act or the regulations by treating an individual as having lost their status as an “applicant” by allowing them to begin working before the employer has completed its post-offer review of the applicant’s criminal history.
EXPANDED ENFORCEMENT FOR WAGE & HOUR JUDGEMENTS
AB 3075 was enacted in response to concerns that some employers attempt to avoid liability for unpaid wages by creating multiple subsidiaries or dissolving the company and reincorporating, making it difficult or impossible to enforce a judgment. This new law attempts to prevent such liability shields by requiring each party to the creation of a new corporation to attest under penalty of perjury that they have no outstanding final judgments issued to them for violations of any wage order or provision of the Labor Code.
AB 3075 also provides that whether a company is a “successor employer” for purpose of collecting a judgment based on a violation of the Labor Code is determined based on the existence of one or more of the following factors: (1) the company uses substantially the same facilities or substantially the same workforce to offer substantially the same services as the predecessor employer, (2) it has substantially the same owners or managers that control the labor relations as the predecessor employer, (3) it employs as a managing agent any person who directly controlled the wages, hours or working conditions of the affected workforce of the predecessor employer, or (4) it operates a business in the same industry and the business has an owner, partner, officer, or director who is an immediate family member of any owner, partner, officer, or director of the predecessor employer.
WHAT SHOULD I DO NOW?
- Review the policies and procedures for compliance with the new laws and regulations.
- For employers not previously covered by CFRA/FMLA, employee handbooks should be updated to provide for CFRA leave and update leave of absence forms.
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. ©2020.