The Law Office of Brian Crone presents the top 10 legal issues for employers to know as we enter 2022.
- Federal Vaccination Mandate for Employers with 100+ Employees
On November 4, 2021, the federal OSHA issued an Emergency Temporary Standard (“ETS”) implementing the vaccine/testing mandate President Biden announced eight weeks ago. The ETS provides covered employers with two pathways for compliance: (1) Require that all employees be vaccinated unless the employee qualifies for a medical or religious exemption (exempt employees must participate in at least once-weekly testing and wear face coverings); or (2) Provide employees with the option/choice of either showing proof of vaccination status or participating in at least once-weekly testing. The ETS requires all covered employees to either be vaccinated or commence weekly testing by January 4, 2022. Key points summarized below:
- Covered Employers: The ETS covers employers with 100 or more employees company-wide, and includes temporary workers, seasonal workers, and minors.
- The ETS requires all employers that have 100 or more employees to implement a mandatory vaccination policy, subject to accommodations for employees that cannot get the vaccine due to medical or religious exemptions. The policy must state that employees are subject to mandatory vaccinations or weekly testing or equivalent safeguarding such as 100% remote work.
- Obtain/Maintain Proof of Vaccination (Various Methods)
- Ensure all unvaccinated employees wear a face covering while indoors or when occupying a vehicle with another person for work purposes, with limited exceptions
- Provide up to four hours of paid time to receive each primary dose (excluding any booster doses) of the vaccine, and reasonable paid time for sick leave for side effects. The paid leave program must be included in the required policy.
CMS is requiring workers at health care facilities participating in Medicare or Medicaid to have received the necessary shots to be fully vaccinated – either two doses of Pfizer or Moderna, or one dose of Johnson & Johnson – by January 4th.
- California Continues to Expand Employee’s Entitlement to Family Medical Leave
Beginning in 2021, California reduced the size of employers obligated to comply with the California Family Rights Act, which dramatically increased the number of employees entitled to such leave. In 2022, the Legislature expanded the definition of “parent” under the CFRA to include parents-in-law.
- Keep Employee’s Records Longer
Under current law, employers are required to maintain personnel records for two years. This requirement has now been lengthened to four years. Where litigation has been filed, such records must be maintained until the applicable statute of limitations has run, or until the conclusion of the litigation, whichever occurs later.
- Settlement Agreement Language Limitation Expansion:
Broadly prohibits non-disclosure provisions (of factual information related to a claim filed in a civil action or a complaint filed in an administrative action) in settlement agreements involving workplace harassment or discrimination based on any protected status under the Fair Employment and Housing Act (FEHA), not just based on sex. It does not prohibit the entry or enforcement of a provision that precludes the disclosure of the amount paid in settlement of a claim. The bill also limits the use of non-disparagement or other contractual provisions in employment agreements, including but not limited to severance/separation agreements, even if no civil action or complaint is filed. Any non-disparagement agreement, separation agreement, or other contractual provision that restricts an employee’s ability to disclose information related to workplace conditions must include the following language: “Nothing in this agreement prevents you from discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination or any other conduct that you have reason to believe is unlawful.” Separation agreements that include such provisions must notify employees that they have at least five business days to consider the agreement and that they have a right to consult an attorney regarding the agreement.
More information on this new law can be found here: (https://www.cronelawoffice.com/blog/2021/10/new-california-law-expands-previous-restrictions-on-non-disclosure-non-disparagement-provisions-in-settlement-or-other-separation-agreements/)
- California Adopts First in the Nation Laws Covering Warehouse Quotas
California has begun regulating the use of employee production “quotas” in warehouse distribution centers, as defined by specified North American Industry Classification System (NAICS) codes, excluding farm product warehousing and storage. A warehouse worker “quota,” is defined as follows: “a work standard under which an employee is assigned or required to perform at a specified productivity speed, or perform a quantified number of tasks, or to handle or produce a quantified amount of material, within a defined time period and under which the employee may suffer an adverse employment action if they fail to complete the performance standard.”
The new law requires that employers provide to employees a detailed written description of any quota. A covered employer may not take adverse employment action against an employee for failure to meet any quota that has not been disclosed in writing to the employee as required by the law. Employees have the right to request a copy of any quota, as well as the most recent 90 days of the employee’s own personal “work speed data.”
A rebuttable presumption of unlawful retaliation will arise if an employer in any manner discriminates, retaliates, or takes any adverse action against any employee within 90 days of either: the employee’s making the first request in a calendar year for information about quotas or work speed data, or the employee’s making a quota-related complaint to the employer or to a government agency.
- Labor Commissioner Has More Enforcement Power & “Wage Theft” is Now in the California Penal Code
California has passed legislation authorizing the Labor Commissioner to create a lien on real property to secure amounts due from the cited parties named in a final citation, findings, or decision.
The Legislature also added section 487m to the California Penal Code, and “grand theft” will be defined to include intentional theft of wages, including gratuities, in excess of $950 from any one employee, or $2,350 from a group of employees. The law defines an “employer” to include the “hiring entity of an independent contractor.” Under existing California law, grand theft may be either a misdemeanor or a felony, and carries potential time in the county jail of up to one year (misdemeanor), or 16 months to three years (felony).
- Cal/OSHA’s Authority Expanded
California expanded the authority of Cal/OSHA in a few important ways. The law establishes two new types of violations: enterprise-wide violations, and egregious violations.
For employers with multiple worksites, a rebuttable presumption that a violation is enterprise-wide will exist if the employer has a written policy or procedure that violates Cal/OSHA rules or the law, or if Cal/OSHA has evidence of a pattern or practice of the same violation or violations committed by that employer involving more than one of the employer’s worksites. If an enterprise-wide violation is found, Cal/OSHA may issue citations and remedial orders for the entire enterprise of the employer – including work locations where no specific violation was found.
An egregious violation may be found in a number of different circumstances. A violation may be egregious if, for example, the employer intentionally, through conscious, voluntary action or inaction, made no reasonable effort to eliminate a known violation, or if a violation results in worker fatalities, a worksite catastrophe, or a large number of injuries or illnesses. Egregious violations also may be found if the violations resulted in persistently high rates of worker injuries or illnesses, or if the employer has an extensive history of prior violations. They may arise where the employer has intentionally disregarded its health and safety responsibilities, or where the employer’s conduct, taken as a whole, amounts to clear bad faith in the performance of its duties under the law. Conduct may be deemed egregious also if the employer has committed a large number of violations so as to undermine significantly the effectiveness of any safety and health program that may be in place.
- Construction Industry Employers Take Note of Joint Liability
Currently, Labor Code section 218.7 provides that for private construction contracts, direct contractors (as defined) must assume and are liable for unpaid wages and benefits of the employees of subcontractors. The liability attaches to wages and benefits owed by any subcontractor in any tier of subcontractors for labor connected to the contract. The liability of the direct contractor does not extend to penalties or liquidated damages, however.
SB 727 amends the law to impose joint liability for a direct contractor for such penalties and liquidated damages, as well as liability for the failure of a subcontractor to make payments to the California unemployment insurance fund or for failure to provide workers’ compensation benefits.
- Ensure Employee Pay Practices Comply With New Interpretations By California Supreme Court
In Ferra v. Loews Hollywood Hotel, LLC, the California Supreme Court rejected the view that meal and rest break premiums are paid at the employee’s base rate, rather than at the more complicated “regular rate of pay” used to calculate overtime premiums. The court found that the phrase from the break requirements (“regular rate of compensation”) is synonymous with the phrases used in the overtime context (“regular rate of pay” and the more general, “regular rate”).
If you have non-exempt employees incurring meal and rest break premiums for the same work weeks in which they earn additional forms of pay (e.g., shift differentials, bonuses, commissions, etc.), employers will need to calculate the regular rate with the same method they use for overtime. In addition, if you have non-exempt employees that earn a non-discretionary bonus covering multiple pay periods, ensure that your payroll processes and/or providers will provide additional compensation for any break premiums paid during the bonus period (along with additional compensation for any other payment-based on the “regular rate”).
- Minimum Wage Increase
Employers must take note that California’s minimum wage will rise again January 1, 2022. When the minimum wage increases, employers must note the increase and ensure exempt employees’ pay (or employees required to use their own tools) is adjusted, if necessary, to exceed the salary basis obligation (identified below).
As has been the case for the last few years, the applicable minimum wage rate depends on the number of employees. Beginning January 1, 2022, the minimum wage rises to $15.00/hr for employers with 26 employees or more (2x the minimum wage increases to $62,400 annually).
For employers with 25 employees or less, the minimum wage rises to $14.00 (2x the minimum wage increases to $58,240 annually).
Effective 1/1/22, to meet the Computer Exemption, employees must be paid minimum annual salary of $104,149.81 to maintain OT exemption.