The California Legislature was unusually active this year. Significantly, California introduced mandatory paid sick live, created new “unfair immigration-related practices” and expanded potential liability for employers who use staffing agencies. All laws take effect on Jan. 1, 2015, unless otherwise noted.
Expanded liability for staffing agencies’ wage/hour violations – AB 1897
This bill makes businesses directly liable to workers supplied by labor contractors (including temporary and other staffing agencies) when those labor contractors fail to correctly and completely pay wages or fail to provide workers’ compensation insurance coverage. See our client alert for more information.
Rest and recovery periods to prevent heat-related illness are paid breaks – SB 1360
Health and safety laws require the provision of paid “recovery periods” to employees in outdoor occupations in certain situations, to prevent heat-related illness. This bill clarifies that “recovery periods” are paid breaks and count as hours worked.
Payment of wages waiting time penalties – AB 1723, AB 2743
Two bills increase enforcement of “waiting time” penalties. Existing law provides that the Labor Commissioner can cite an employer who pays less than the minimum wage, and that the citation can include a civil penalty, restitution, and liquidated damages. AB 1723 authorizes the Labor Commissioner also to include “waiting time” penalties—penalties for an employer’s failure to timely pay wages to an employee upon termination. The law does not create new penalties, but adds a new enforcement mechanism to the Labor Commissioner’s arsenal.
AB 2743 provides a waiting time penalty if unionized theatrical and concert venue employers violate any agreed-upon timeframe for payment of final wages contained in a collective bargaining agreement.
Timeframe for recovery of wages: liquidated damages – AB 2074
A lawsuit seeking to recover liquidated damages for minimum wage violations can now be filed any time before expiration of the three-year statute of limitations of the underlying wage claim. Some recent cases had held that liquidated damages claims had to be filed within one year.
Discrimination against employees with undocumented drivers’ license – AB 1660
Existing law requires the Department of Motor Vehicles (DMV) to issue a driver license to otherwise qualified California residents even if they are unable to submit proof that their presence in the United States is authorized under federal law. This bill amends the California Fair Employment and Housing Act (“FEHA”) to make it illegal for an employer to discriminate against individuals because they hold or present such a driver’s license.
Expansion of “unfair immigration-related practices” and clarification of discrimination – AB 2751
This bill expands the definition of an “unfair immigration-related practice” to include threatening to file or filing a false report or complaint with any state or federal agency. Current law extends the protection only to reports filed with the police. The bill also clarifies that an employer can’t discriminate or retaliate against an employee who updates his or her personal information “based on a lawful change of name, social security number, or federal employment authorization document.”
Discrimination and harassment protection for unpaid interns and volunteers – AB 1443
This bill extends the harassment and discrimination protections of FEHA to unpaid interns, volunteers, and apprenticeship trainees. In addition to being liable to these individuals for conduct by another employee or a supervisor, an employer may be liable for harassment by a nonemployee if the employer knew or should have known of the conduct and failed to take immediate and appropriate corrective action.
Abusive conduct prevention training – AB 2053
Employers subject to the mandatory sexual harassment prevention training requirement for supervisors must now include in the training prevention of “abusive conduct.” Abusive conduct is defined as conduct of an employer or employee in the workplace, with malice, that a reasonable person would find hostile, offensive, and unrelated to an employer’s legitimate business interests.
Leave & Benefits
Paid sick leave – SB 288
The Healthy Workplaces, Healthy Families Act of 2014 requires employers to provide almost all California employees with one hour of paid sick leave for every thirty hours worked. The law will become effective on July 1, 2015. See our client alert for more information.
Expansion of emergency personnel leave – AB 2536
This bill expands the list of employees eligible for protected time off for emergency duty to include an officer, employee, or member of a disaster medical response entity sponsored or requested by the State. It also requires employees who are health care providers to notify their employer at the time they become designated as emergency rescue personnel and when they are notified that they will be deployed as a result of that designation.
Waiting period limit on certain health plans now in accord with federal standards – SB 770
The bills repeals the 60-day waiting period limit imposed on certain health insurance plans in California, which conflicted with the federal Affordable Care Act’s 90-day waiting period limit. With the repeal, California employers may operate consistent with federal ACA regulations concerning waiting periods in 2015.
Employers may use email to report serious injuries to DOSH – AB 326
Under existing law, employers are required to report major occupational injury or illness to the Division of Occupational Safety and Health (DOSH) via telegraph or telephone. This bill allows employers to make the reports by email as well.
Other Employment-Related Laws
Arbitration agreements – AB 2617, AB 802
These two bills potentially decrease the attractiveness of arbitration agreement for employers. In addition to broad consumer protection provisions, AB 2617 will prohibit employers from requiring an applicant or employee to agree to arbitrate some discrimination claims related to hate crimes. Although it is likely to be challenged as preempted by the Federal Arbitration Act, the bill will apply to all agreements entered into, or renewed, after Jan. 1, 2015.
In a separate bill, AB 802 requires major arbitration administrators such as JAMS and AAA to publish at least quarterly on their websites detailed information concerning all arbitrations they have handled, including (1) the name of any non-consumer party involved in the arbitration (i.e. the name of the employer), (2) the nature of the dispute (e.g. employment), (3) where the non-consumer party is an employer, whether the employer or responding party initiated the arbitration, (4) the annual wage (in a range) earned by the involved employee, (5) the amount of the claim, which party prevailed, and the amount of any award, including attorneys’ fees, (6) whether the employee was represented by an attorney and, if so, the name of the attorney and the law firm, (7) the name of the arbitrator and the amount of the arbitrator’s fees, and (8) the total number of times the employer previously has been a party in arbitration or mediation before the dispute resolution provider. This new law has the obvious (and likely intended) effect of destroying the usual benefit of confidentiality that arbitration has provided, and even jeopardizes the privacy of mediation to an extent.
Increased employer responsibility for data breaches – AB 1710
This bill requires a business that owns, licenses, or maintains personal information about a California resident to implement and maintain reasonable security procedures and practices appropriate to the nature of the information to protect the information from unauthorized access, destruction, use, modification, or disclosure. If a business providing notification of a breach was the source of the breach, it must offer to provide appropriate identity theft prevention and mitigation services, if needed, to the affected person at no cost for not less than 12 months if the breach exposed or may have exposed specified personal information.
Expanded disclosure requirements in the event of computerized data breaches – SB 46
This law imposes additional disclosure requirements on a California business that suffers a security breach exposing personal information that could allow access to an online or email account.
Other new laws pertain exclusively to employers who have contracts with the government, or who provide extracurricular services to minors.
These capsule summaries are intended to inform employers about the most significant of the new statutes and do not fully explore the details of each. For more information on or questions about any of the new California laws, please contact any of Davis Wright Tremaine’s California employment lawyers.