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California Employment Law Updates For 2020

| Dec 31, 2019 | Firm News |

The year 2019 is almost at an end and 2020 is about to begin.  With 2020 arriving soon, I wanted to identify for you some employment laws that come into effect on January 1, 2020 and identify changes that you may wish to incorporate in your employee policies or procedures.

Minimum Wage Increase

The minimum wage increases on January 1, 2020 to $12.00 for employers that employ 25 or fewer employees and $13.00 for employers that employ 26 or more employees. Along with the increase in minimum wage, the salary threshold to classify an employee as “exempt” will automatically increase to $49,920 annually for employers of 25 or fewer employees and $54,080 annually for employers of 26 or more employees.

Discrimination Based Upon Hairstyles

California became the first state to directly prohibit discrimination based on certain hairstyles that are historically associated with race, such as hair texture and protective hairstyles. All employers need to ensure that their dress/grooming standards properly account for California’s new standards.

Employee Lactation Policies And Requirements

California has once again amended the laws requiring employers to provide adequate lactation accommodations to employees. Generally, the revisions generally require the employer to provide a “reasonable amount of break time” to express mile “each time the employee has a need to express milk.” The law further identifies additional requirements for the lactation room and requires the employer provide access to a sink with running water and a refrigerator for storing milk in close proximity to the employee’s workspace. Finally, Labor Code section 1034 has been amended to require an employer to develop and implement a policy regarding lactation accommodation that includes the following:

  • A statement about an employee’s right to request lactation accommodation;
  • The process by which the employee makes the request;
  • An employer’s obligation to respond to the request; and
  • A statement about an employee’s right to file a complaint with the Labor Commissioner for any violation of a right under this chapter.
  • An employer also cannot discriminate or retaliate against an employee for exercising her rights.

Updates To Mandatory Sexual Harassment Training Legislation

In 2018, California expanded the obligation to provide mandatory sexual harassment training from employers with 50 or more employees to any employer with 5 or more employees. In addition, the previous law extended the training requirements to non-supervisory employees by requiring the employer to provide at least one (1) hour of sexual harassment training to non-supervisory employees (in addition to the two (2) hours to supervisory employees). The law contained ambiguities so the California legislature passed emergency legislation that delayed by one year the requirements of the 2018 law.  Accordingly, employers with 5 or more employees, must provide training as follows:

  • By Jan. 2021, must provide two hours to supervisory (unless 50 or more)
  • By Jan. 2021, must provide one hour to non-supervisory
  • Train new employees within 6 months of hire.

Mandatory Use Of Arbitration As A Condition Of Employment

The California legislature banned the MANDATORY use of arbitration of disputes in connection in the employment relationship. California DID NOT ban employers from utilizing arbitration as the method of resolving employment disputes. Instead, the employer can no longer require that an employee agree to arbitration as a condition of employment (getting hired) or continued employment. If you are considering instituting an arbitration program, please contact me to discuss.

Time Off For Living Organ Donation

Protected Time Off – Living Organ Donation: Employers with 15 or more employees have been required to provide employees up to 30 days of paid leave for organ donations. California expanded this law to provide up to an additional 30 days of UNPAID leave for an organ donor.

“No-Rehire Provisions” In Legal Settlements

Beginning January 1, 2020, California employers are no longer permitted to include a “no-rehire provision” in any “agreement to settle an employment dispute.” This law primarily relates to settlements of employment lawsuits, arbitrations or mediations and a rather common term is a provision by which the employee agrees that he/she will not seek re-employment with the employer. This law will now prevent employers from including such terms in settlement agreements. This law does not currently preclude an employer from including such a term in a severance/separation agreement provided at the conclusion of employment, so long as it was not created in the context of a specific employment dispute.

Three-Part Test To Determine If A Worker Is An Independent Contractor

California Assembly Bill 5 – The California Legislature passed legislation codifying the California Supreme Court’s 2018 decision in Dynamex Operations West, Inc. v. Superior Court of Los Angeles (2018) 4 Cal.5th 903 establishing a three-part test to determine whether a person providing services to a business is an employee or independent contractor. The law creates the presumption that every worker is an employee and places the burden of proving otherwise on the company.  If an employee is misclassified, the company risks incurring liability to the worker for wage/hour violations under the California Labor, penalties for failing to make required EDD contributions, and penalties for failing to obtain sufficient workers compensation insurance.

In order to establish a particular worker is an independent contractor, the law requires the Company to establish the worker meets the ABC test:

  • Part A: Is the worker free from the control and direction of the hiring entity in the performance of the work, both under the contract for the performance of the work and in fact?
  • Part B: Does the worker perform work that is outside the usual course of the hiring entity’s business?
  • Part C: Is the worker customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity?

If the company cannot establish the worker meets all three of these tests, then the worker will be considered an employee. The California legislature did provide a number of exemptions for particular industries and occupations. The list is too numerous to set forth herein.  If, however, your particular business uses independent contractors, then please contact me to ascertain whether your business relationship meets one or more exemptions.

California Consumer Privacy Act (CCPA)

California Consumer Privacy Act: By January 1, 2020, companies that are subject to the requirements of the CCPA must:

  • Ensure they have implemented reasonable security measures both physical and electronic, to safeguard the personal information of employees and job applicants.
  • Disclose the type of information used and for what purpose. Examples of business purposes in the employment context include:
    • to comply with state and federal law requiring employers to maintain certain records;
    • to effectively process payroll;
    • to administer and maintain group health insurance benefits, 401K and/or retirement plans; and
    • to manage employee performance of their job duties.

The disclosures can be included in an employee handbook, job application, or both. If you need to determine if your business is subject to the CCPA, please do not hesitate to contact me.