Overview:

New employment laws in California are here, with topics ranging from bereavement leave to cannabis use.  Here’s a quick rundown:

• AB 1041:  Expansion of California Family Rights Act and Healthy Workplaces Healthy Families Act
  • Expands the class of people for whom an employee may take leave to care for.
• SB 3:  Minimum Wage Increase
  • Minimum wage is now $15.50/hour in California.
• AB 1601:  Employment protections: mass layoff, relocation, or termination of employees: call centers
  • Prohibits call center employers from relocating a call center without proper notice.
• AB 1949:  Addition of bereavement leave under the California Family Rights Act
  • Grants employees up to 5 days of bereavement leave if they have been employed for at least 30 days.
• AB 2188:  Discrimination in employment: use of cannabis
  • Prohibits employers from discriminating against employees who use cannabis off the job.
• SB 1044:  Employers: emergency condition; retaliation
  • Prohibits an employer, in the event of an emergency condition, from taking or threatening adverse action against any employee for refusing to report to, or leaving, the workplace within the affected area because the employee has a reasonable belief that the workplace is unsafe.
• SB 1162:  Employment: salaries and wages; pay data; pay scales
  • Requires additional information to be reported to the state of California on an employer’s pay data report; employers must also provide a pay scale to any current employee, upon request.
• AB 257:  Fast Food Accountability and Standards Recovery Act
  • Sets minimum standards for wages, hours, and other conditions for fast-food workers. Minimum wage for these workers could go up to $22/hour.

AB 1041:  Expansion of California Family Rights Act and Healthy Workplaces Healthy Families Act

Effective January 1, 2023, this new law expands the definition of a “family member” under the California Family Rights Act (CFRA) and California’s Healthy Workplaces Healthy Families Act (HWHFA) to include a “designated person.”  Under both the amended CFRA and HWHFA, employees can identify a designated person for whom they want to use leave when they request unpaid leave under the CFRA or paid leave under HWHFA.  Employers can limit an employee to one designated person per 12-month period.

Under the CFRA, a designated person means “any individual related by blood or whose association with the employee is the equivalent of a family relationship.”  However, under HWHFA a designated person is “a person identified by the employee at the time the employee requests paid sick days” and the designated person does not need to be related by blood, nor does their association with the employee need to be the equivalent of a family relationship.  A “designated person” for HWHFA purposes could potentially include a roommate or even a neighbor.

The expansion of the concept of a “family member” to include a “designated person” must also be viewed in the context of similar federal legislation, such as the federal Family and Medical Leave Act (FMLA).  Employers’ HR departments must accurately track how much job-protected unpaid family medical leave employees can use during any given 12-month period, and the possibility of further extended leave periods is increased due to the expansion of the scope of persons who an employee may voluntarily designate.

SB 3:  Minimum Wage Increase

Effective January 1, 2023, minimum wage in California is $15.50 per hour.  As such, the minimum annual salary to meet the “white collar” exemption increases to $64,480.00.  Certain local minimum wage ordinances carry January 1^st increase dates, including San Diego ($16.30/hour), San Jose ($17.00/hour), and West Hollywood ($17.00/hour, or $17.50/hour for employers with 50 or more employees).  Employers must carefully review all applicable local minimum wage requirements and ensure their workers are properly classified and paid.

AB 1601:  Employment protections: mass layoff, relocation, or termination of employees: call centers

This law prohibits a call center employer from ordering the relocation of its call center, unless 60 days before the order takes effect, the employer gives written notice to the impacted employees, the Employment Development Department, the local workforce investment board, and the chief elected official of each city and county government in the applicable jurisdiction.

If an employer fails to provide proper notice before relocating a call center, it would be ineligible for state grants or state-guaranteed loans for 5 years.  The employer would also not be permitted to claim a tax credit for 5 taxable years.

AB 1949:  Addition of bereavement leave under the California Family Rights Act

AB 1949 grants employees up to 5 days of bereavement leave under the California Family Rights Act if they have been employed for at least 30 days and the leave is for the death of a spouse, child, parent, sibling, grandparent, grandchild, domestic partner, or parent-in-law.  The leave is unpaid, but the employee must be permitted to use vacation, personal leave, accrued and available sick leave, or other accrued PTO.

Within 30 days after the leave is taken, the employer may request documentation from the employee, which could consist of a death certificate, a published obituary, or written verification of death, burial, or memorial services from a mortuary, funeral home, burial society, crematorium, religious institution, or governmental agency.  Employers are required to maintain the confidentiality of any employees requesting bereavement leave.

AB 2188:  Discrimination in employment: use of cannabis

Effective January 1, 2024, this prohibits employers from discriminating against employees who use cannabis off the job and away from the workplace.

AB 2188 amends the California Fair Employment and Housing Act by making it unlawful for an employer to discriminate against a person in hiring, termination, or any term or condition of employment, or otherwise penalize a person, if the discrimination is based upon either (i) the person’s use of cannabis off the job and away from the workplace, or (ii) an employer-required drug screening test that has found the person to have nonpsychoactive cannabis metabolites in their urine, hair, blood, or other bodily fluids.  Any adverse employment actions taken against employees or applicants based on drug tests screening for nonpsychoactive cannabis metabolites could lead to claims of discrimination and/or wrongful termination.

AB 2188 does not permit employees to possess, to be impaired by, or to use cannabis on the job, nor will it affect the rights or obligations of an employer to maintain a drug-and alcohol-free workplace.  It also does not apply to employees in the building and construction trades or those hired for positions that require a federal government background investigation or security clearance.

SB 1044:  Employers: emergency condition; retaliation

Effective January 1, 2023, SB 1044 prohibits an employer, in the event of an emergency condition, from taking or threatening adverse action against any employee for refusing to report to, or leaving, the workplace within the affected area because the employee has a reasonable belief that the workplace is unsafe.  An “emergency condition” means the existence of either (i) conditions of disaster or extreme peril to the safety of persons or property at the workplace or worksite caused by natural forces or a criminal act, or (ii) an order to evacuate a workplace, a worksite, a worker’s home, or the school of a worker’s child due to natural disaster or a criminal act.

The law also prohibits an employer from preventing any employee from accessing the employee’s cell phone or other communications device for seeking emergency assistance, assessing the safety of any given situation, or communicating with a person to confirm their safety.  It also requires an employee to notify the employer of an emergency condition which may prompt the employee to leave or refuse to report to the workplace.

SB 1162:  Employment: salaries and wages; pay data; pay scales

This broad pay transparency bill requires California employers to include pay ranges in all job advertisements effective January 1, 2023. The new law also requires employers to provide expanded annual pay data reports (which include pay data on employees hired through labor contractors) to the California Civil Rights Department beginning May 10, 2023, and every second Wednesday in May annually thereafter.

California law currently prohibits employers from asking applicants about their salary history during the hiring process, and employers must provide the pay scale for a position to an applicant upon request.  SB 1162 expands these requirements by (i) requiring employers with 15 or more employees to include the pay scale in any job posting, (ii) requiring all employers to provide the pay scale for the position in which a current employee is employed, upon request, and (iii) requiring all employers to maintain records of job titles and wage history for each employee for the duration of employment (and three years thereafter) to enable the government to determine if there is a pattern of wage discrepancy.

AB 257:  Fast Food Accountability and Standards Recovery Act (FAST Recovery Act)

This new law was slated to take effect January 2023, but a voter referendum has blocked it.  Now, the law cannot be implemented unless it wins a ballot vote in November 2024.  If it passes, this new law would create a council of 10 labor representatives which could raise the minimum wage for fast-food workers to $22/hour, resulting in an average wage increase of approximately 40% for those workers.  The council would also be empowered to set the working hours and other conditions for such workers.

Critics of the law believe it will harm small business and franchise owners through increased labor costs and food prices, which ultimately will be passed along to consumers.  In addition, significant layoffs and time-worked downsizing would likely occur, harming much of the workforce intended to be assisted.  Such a dramatic increase in the minimum wage for fast-food workers would certainly improve pay for those who are able to keep their jobs at the hours they need, but would have negative impacts on employers, consumers, and certainly the workers who suffer job loss as a result.

Conclusion:

Several new employment-related laws have been enacted which take effect in 2023, and savvy California employers and human resource managers are implementing policies and procedures to ensure compliance.  The new laws are robust, complex, and will require each employer to assess the applicability of each law to their business operations and specific circumstances.  Of particular complexity is the expansion of the definition of a “family member” to include a “designated person,” and the interplay this will have with existing federal and local legislation.  When in doubt, consult with competent legal counsel and act accordingly.