Recently, the Los Angeles County Board of Supervisors passed the Fair Workweek Ordinance, similar to the ordinance passed by the City of Los Angeles last year.

The ordinance takes effect July 1, 2025.

Covered Employers

The ordinance applies to retail employers who:

  • Are identified as a retail business in the North American Industry Classification System (NAICS) within the retail trade categories and subcategories 44 through 45; or any business, including non-profit organizations, whose revenues are generated mainly from the sale to end users of tangible products that are primarily for personal, household, or family purposes, including, but not limited to, appliances, clothing, electronics, groceries, and household items;
  • Directly, indirectly, or through an agent or any other person, including through the services of a contractor, temporary service, or staffing agency, exercises control over the wages, hours, or working conditions of any retail employee; and
  • Employ 300 or more employees globally.

Covered Employees

The ordinance applies to retail employees who:

  • In a particular workweek performs at least 2 hours of work within the unincorporated areas of the county for a retail employer (check the County’s page to determine whether a workplace is in unincorporated areas of the county);
  • Qualifies as an employee entitled to payment of a minimum wage from a covered employer under the California minimum wage law as provided under California Labor Code section 1197 and wage orders published by the California Industrial Welfare Commission; and
  • Is assigned a primary work location and duties that support retail operations, including, but not limited to, a retail store or warehouse.

Obligations of Covered Employers

Per the ordinance, covered employers must provide the covered employee with a written good-faith estimate of a work schedule before hiring. The good faith estimate must include a notice of rights under the ordinance.

If a covered employee’s hours, day, location, or shifts worked substantially deviate from the good faith estimate, the employer must have a documented, legitimate business reason, unknown at the time the estimate was provided.

A covered employer must provide notice of a covered employee’s schedule at least 14 days before the start of the work period either by posting or transmitting by electronic means.

Before a retail employer may hire new employees or use a contractor or similar, the retail employer must first offer work to current employees if:

  • One or more employees are qualified to do the work and
  • The additional work hours would not result in the payment of a premium rate under California law.

Covered employers must not schedule covered employees to work a shift that starts less than 10 hours from the end of their last shift unless they obtain written consent from the employee and pay the employee a premium of time and a half for each hour of the second shift.

Predictability Pay

Covered employers must provide Predictability Pay under the following conditions:

  • Compensate a covered employee with one additional hour of pay at the employee’s regular rate for each change to their work schedule that results in no loss of time to the employee or results in additional work time that exceeds 15 minutes.
  • Compensate a covered employee at one-half the employee’s regular rate of pay for the time the employee does not work for the following reasons if occurring after the advanced notice required under the ordinance:
    • Subtracting hours from a shift before or after the employee reports for duty;
    • Changing the start or end time of a shift results in a loss of more than 15 minutes;
    • Changing the date of a shift;
    • Cancelling a shift; or
    • Schedule the covered employee for an on-call shift in which the employee is not called in.

Whereas, Predictability Pay is not required under the following conditions:

  • A covered employee requested a schedule change;
  • A covered employee accepts a schedule change initiated by the employer due to the absence of another employee;
  • The employee accepts additional hours offered under the ordinance; or
  • The employee’s hours are reduced due to the employee’s violation of an existing law or policy.

Notice and Recordkeeping Requirements

Retail employers must post notice of the covered employee’s workweek rights which will be published by the Department of Consumer & Business Affairs.

Retail employers must retain all records required under the ordinance for both current and former employees for 3 years.

If you have questions about the Los Angeles County Fair Workweek or related issues, contact a Jackson Lewis attorney to discuss.

For the second time, the California Supreme Court issued a ruling in Naranjo v. Spectrum Security Systems in May. In May 2022, the California Supreme Court issued its first decision in Naranjo v. Spectrum Security Systems, which considered the issue of whether failure to pay premium wages for meal and rest period violations gave rise to claims for waiting time penalties or violations of wage statement requirements.

The underlying action was a class action brought by former and current employees of Spectrum Security for meal period violations. The class sought waiting time penalties and penalties for failure to provide accurate wage statements.

The case was remanded to the California Court of Appeal on two issues:

  1. Whether the trial court erred in finding Spectrum Security had not acted “willfully” in failing to timely pay employees premium pay, which barred recovery of waiting time penalties.
  2. Whether Spectrum Security’s failure to report missed-break premium pay on wage statements was “knowing and intentional” to allow recovery of penalties for failure to provide accurate wage statements.

The Court of Appeal concluded as to the first question that the substantial evidence supported the trial court’s finding that Spectrum Security presented defenses at trial in good faith for its failure to pay meal premium to departing employees and therefore its failure was not “willful” to entitle employees to waiting time penalties. As to the second question the Court of Appeal held that because Spectrum Security had a good faith belief that it complied with wage statement requirements, the trial court was precluded from finding the violation was “knowing and intentional” and awarding penalties.

In its second opinion on Naranjo issued on May 6, 2024, the California Supreme Court stated, “[o]n remand, the answer to the question of Labor Code section 203 penalties was clear. Under long-established law, an employer cannot incur civil or criminal penalties for the willful nonpayment of wages when the employer reasonably and in good faith disputes that wages are due…”

However, as the California Supreme Court noted in its decision, the courts have been divided over whether an employer’s good faith belief will also bar Labor Code section 226 penalties for a “knowing and intentional” failure to report the same unpaid wages or any other required information, on a wage statement.

The California Supreme Court agreed with the Court of Appeal below that if an employer reasonably and in good faith believed it was providing a complete and accurate wage statement in compliance with the requirements of section 226, then it has not knowingly and intentionally failed to comply with the wage statement law.

This decision is a bright spot for employers trying to comply with the myriad of California wage and hour laws. While the language of the statute has always stated that penalties could only be recovered for “knowing and intentional” violations, in light of this decision, employers that can demonstrate a good faith belief in the accuracy of their wage statements now can forcefully argue that there was no failure to comply with wage statement law, and thus no penalty should apply.

If you have questions about the latest decision by the California Supreme Court or related issues, contact a Jackson Lewis attorney to discuss.

In 2022, the City of Inglewood passed a healthcare worker minimum wage ordinance. The new $25.00 minimum wage applies to private-sector healthcare employees who work in hospitals, integrated health systems, and dialysis clinics in Inglewood.

The new minimum wage applied to clinicians, nurses, certified nursing assistants, aides, technicians, maintenance workers, janitorial or housekeeping staff, groundskeepers, guards, food services workers, laundry workers, and pharmacists but does not include managers or supervisors.

The California Hospital Association challenged the law and recently the district court struck portions of the ordinance as preempted by the National Labor Relations Act. The judgment strikes sections 8-152 (c) – (d), which prohibits the employer from funding the minimum wage increases required by the ordinance by:

  • Reducing premium pay or shift differentials
  • Reducing benefits such as vacation and healthcare
  • Reducing hours worked
  • Laying off workers
  • Increasing charges to workers such as for parking.

It is possible the City of Inglewood could appeal the decision of the Court, though no appeal has been filed to date.

Meanwhile, the Governor’s push to delay the state-wide healthcare minimum wage is still in limbo. To date, the healthcare minimum wage increase statewide will take effect June 1.

Jackson Lewis will continue to monitor developments related to the healthcare worker minimum wage ordinances and statute. If you have questions about the Inglewood ordinance or related issues with healthcare minimum wage contact a Jackson Lewis attorney to discuss.

Employers covered by San Francisco’s Fair Chance Ordinance or Health Care Security Ordinance are required to submit the Employer Annual Report Form to the San Francisco Office of Labor Standards Enforcement (OLSE) by May 3, 2024. The purpose of the Annual Report Form is to provide OLSE with a snapshot of the employer’s compliance with either of these two San Francisco ordinances. Covered employers who fail to submit the form by the deadline may be subject to a penalty of $500 per quarter.

Instructions and resources for employers who are required to report are on the OLSE’s website.

Which Employers Must Comply With The Fair Chance Ordinance?

San Francisco’s Fair Chance Ordinance (FCO) applies to employers with five or more employees worldwide, as well as employers of any size who contract with the City and County of San Francisco. Similar to the State of California’s Fair Chance Act, the FCO prohibits covered employers from asking job applicants for positions that require at least eight hours of work per week in San Francisco about arrest or conviction records until after a conditional offer of employment is issued.  In addition, the FCO prohibits covered employers from considering certain facts during the application process, including whether a job applicant’s history includes an arrest that did not lead to a conviction.

The annual reporting requirements include disclosing the number of employees the employer hired to work in San Francisco in 2023, whether the employer conducted background checks of job applicants, and whether the employer hired anyone who had a conviction history.

Which Employers Must Comply with the Health Care Security Ordinance?

The Health Care Security Ordinance (HCSO) applies to private and non-profit employers who employ any individual in San Francisco, and twenty or more workers, or in the case of non-profits, 50 or more workers, inside or outside of San Francisco.  Under the HCSO covered employers must spend a minimum amount set by law on healthcare for each employee who works eight or more hours each week in San Francisco.

The reporting requirement includes disclosing the number of individuals employed in each quarter of 2023, the number of employees covered by the HCSO in each of those quarters, the employer’s total spending on healthcare, and the types of healthcare coverage the employer offered to employees.

If you have questions about reporting requirements for or your organization’s compliance with, the FCO or HCSO, reach out to a Jackson Lewis attorney to discuss.

On April 1, 2024, the new fast-food minimum wage took effect. At the end of March, California’s Labor Commissioner issued an FAQ regarding the new minimum wage. It includes the following sections:

  • Overview of the Minimum Wage Increases
  • Who is covered by the law
  • The role of the fast-food council in addition to minimum wage

The FAQ highlights important aspects of the new fast-food minimum wage statute:

Posting Requirements

There is a supplemental posting to the minimum wage order that must be posted by covered employers. The supplemental posting is available on the Labor Commissioner’s page.

Covered Employees

The FAQs reiterate the definition of “fast-food restaurant employees” as follows:

 The law applies only to employees of “fast food restaurants.” To be considered a fast food restaurant, the restaurant must meet ALL of the below criteria:

  1. The restaurant must be a “limited-service restaurant” in California. A limited service restaurant is one that offers limited or no table service, where the customers order food or beverage items and pay for those items before the items are consumed.
  2. The restaurant is part of a restaurant chain of at least 60 establishments nationwide. An establishment is a single restaurant location offering food or beverages to customers. Off-site business locations (geographically separate from a restaurant location), at which employees perform administrative, warehouse, or preparatory food production tasks, are not counted as “establishments” toward the 60 establishment minimum.
  3. The restaurant is primarily engaged in selling food and beverages for immediate consumption.

Employees who work at different locations of the same fast food restaurant chain may not both be covered if one of the locations is exempt from the law, such as if just one location produces bread on-site.

Importantly, the FAQs confirm that the minimum wage set by the statute impacts the minimum salary threshold to be an exempt employee under California law. Under state law, the minimum salary threshold is currently $66,560 but it is now $83,200 for restaurant employees. However, if the exempt employee is working at a larger store with a fast-food component and other aspects, the FAQs provide that a blended rate may be appropriate between the fast food and non-fast food work calculated on a weekly basis based on the percentage of time spent on those tasks. An example is provided in the FAQs but employers should consult counsel if they decide to move forward with this blended rate approach.  

Fast Food Council

Though the minimum wage has been the most highly publicized aspect of the law, the Council will also meet regularly to develop other minimum employment standards for the fast food industry in California.

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If you have questions about California’s fast food minimum wage or related issues, contact a Jackson Lewis attorney to discuss.

California’s pro-employee employment regulations are often compared to those of the European Union. Recently, the California legislature borrowed another European idea for a proposed bill, “the right to disconnect from work.”

Assembly Bill (AB) 2751 would mandate that employers establish policies that allow employees to disconnect from employment communications during non-working hours.

Under the proposed law, employers would not be permitted to contact the employees outside of working hours except in the event of an “emergency” or “scheduling.”

Under the bill, an emergency is defined as “an unforeseen situation that threatens an employee, customer, or the public; disrupts or shuts down operations; or causes physical or environmental damage.”

Employees could file complaints with the California Labor Commissioner for alleged violations, and a pattern of violations would be punishable as a misdemeanor and a fine of not less than $100.00.

In its current form, the bill does not apply to employees covered by a valid collective bargaining agreement.

AB 2751 is still in the committee stages of the legislative process with this year’s legislative session ending on August 31, 2024.

Jackson Lewis will continue to track this and other legislation that affects employers in the Golden State. If you have questions about AB 2751 or related issues, contact a Jackson Lewis attorney to discuss.

Last year, California’s Governor signed Senate Bill (SB) 553, which requires most employers to establish, implement, and maintain an effective Workplace Violence Prevention Plan (WVPP). The law is enforceable on July 1, 2024. Cal/OSHA is responsible for enforcing the requirements of SB 553, now codified in California Labor Code Section 6401.9.

Recently, Cal/OSHA published a Frequently Asked Questions (FAQ) page to assist with compliance.

The FAQ reviews the following:

  • Definitions under the statute
  • Employer applicability
  • Requirements for the WVPP
  • Violent Incident Logs
  • Training
  • Recordkeeping
  • Effective date

While many questions remain, employers should take note of Cal/OSHA’s position on some issues in the FAQ:

  1. Employers need to provide initial training under their WVPP by July 1, 2024, when enforcement commences.
  2. Employers must ensure their written WVPP “is specific to the hazards and corrective measures for each work area and operation” and not a top-down “corporate plan.”
  3. Animal attacks and other “acts of violence or threat of violence” are included in the definition of workplace violence under the legislation.

If you have questions about compliance with SB 553 or related issues, contact a Jackson Lewis attorney to discuss.

In its recent opinion in Huerta v. CSI Electrical Contractors, the California Supreme Court addressed three inquiries posed by the 9th Circuit. These inquiries specifically relate to the definition of “hours worked” within the context of the California wage order applicable to the construction, drilling, logging, and mining industries, as well as the California labor code.

In the underlying action, employees were working on a solar power facility located on privately owned land that had limited access on and off the highway.  As a result, the employees’ entry was sometimes delayed, with having to go through gates, security checkpoint (s) (which moved during the scope of the project) and having to drive slowly to protect endangered species in the area.

The first question from the 9th Circuit was: Is time spent on an employer’s premises in a personal vehicle and waiting to scan an identification badge, have a security guard peer into the vehicle, and then exit the security gate compensable as “hours worked”?

To this question, the California Supreme Court held that time spent on an employer’s premises awaiting and undergoing an employer-mandated exit procedure was compensable as “hours worked.”

The second question: Is time spent on the employer’s premises in a personal vehicle, driving between the security gate and the employee parking lots subject to certain rules from the employer “hours worked”?

The California Supreme Court stated to the second question that travel time from the security gate to employee parking lots is compensable if the security gate was the first location where the employee was required for an employment-related reason. However, this travel time is not counted as work hours because an employer’s standard rules during employees’ drive to the worksite in a personal vehicle do not establish sufficient employer control.

The Court stated in its opinion, “We decline to reduce the control test to a categorical rule of compensability for any time that an employee spends traveling on work premises. Rules designed to ensure safe, lawful, and orderly conduct while traveling on an employer’s premises, such as the general Site rules and the ‘rules of the road’ at issue here, do not impose a level of control that renders the time compensable. … Because an employee’s drive on the access road is not a form of exertion that a manager would recognize as work on the Site, the drive time is not compensable under the suffer or permit clause.”

The third question: Is time spent on the employer’s premises, when workers are prohibited from leaving but not required to engage in employer-mandated activities, hours worked when it is designated as an unpaid meal period under a qualifying collective bargaining agreement (CBA)?

For the final question, the California Supreme Court held that when an employee is covered by a CBA that complies with Labor Code section 512 and the wage orders and provides the employee with an unpaid meal period that time is nonetheless compensable as “hours worked” if the employer prohibits the employees from leaving the employer’s premises or designated area during the meal period and if the prohibition prevents the employee from engaging in otherwise feasible personal activities.  

However, the Court stated “[w]e interpret Wage Order No. 16, section 10(D) and (E) to permit employees to bargain for a voluntary paid on-duty meal period. In other words, an exemption from section 10(D) permits workers to negotiate a contract for on-duty meal periods even when “the nature of the work” does not “prevent[] the employee from being relieved of all duty.”

If you have questions about the application of the California Supreme Court’s decision or related issues, contact a Jackson Lewis attorney to discuss.

On March 26, 2024, Governor Newsom signed Assembly Bill (AB) 610, which amends the definition of “fast food restaurant” to exempt restaurants in airports, hotels, event centers, theme parks, museums, and certain other locations from the requirements set forth under the Fast Food Council requirements.

Last year, Newsom signed AB 1228, which repeals the FAST Recovery Act but establishes a modified version of the Fast Food Council (Council) until January 1, 2029. The bill also sets forth the minimum wage increases for fast food workers, with an increase to $20.00 effective April 1, 2024. 

The bill includes an urgency clause which means it takes effect immediately. As such the exempted businesses will not need to comply with the minimum wage requirements past in 2023.

If you have questions about AB 610 or related issues, contact a Jackson Lewis attorney to discuss.

At the end of February, the Los Angeles County Board of Supervisors passed an ordinance adding several compliance requirements to the California Fair Chance Act requirements for employers considering the criminal history of applicants and employees in making employment decisions.

The Fair Chance Ordinance (FCO) applies to employers with 5 or more employees in unincorporated areas of Los Angeles County.

The ordinance takes effect March 28, 2024, and is operative September 3, 2024.  

The following is a summary of some of the ordinance’s requirements.

Job Postings

Under the FCO employers shall not prevent or discourage applicants or employees with criminal history from applying or responding to job solicitations, postings, announcements, and advertisements (together referred to as “job postings”) including:

  • Include in all job postings language stating that qualified applicants with arrest or conviction records will be considered for employment.
  • Shall not include statements in job postings that no person with a criminal history will be considered for hire or should not apply.
  • Specify in all job postings any local, state, or federal laws that impose restrictions or prohibit the hiring of individuals with specified criminal history.
  • Specify in the job postings the employer’s intention, if any, to conduct a review of an employee’s criminal history in connection with a conditional offer and include a list of all material job duties of the specific job position which the employer reasonably believes that the criminal history may have a direct, adverse and negative relationship potentially resulting in the withdrawal of the conditional offer of employment.

Background Checks

Covered employers are prohibited from inquiring about criminal history prior to extending an applicant or employee a conditional offer of employment unless legally required to do so. This includes not asking or encouraging an applicant or employee to disclose information about their criminal history or rejecting applications because criminal history was not provided.

If conducting a background check after a conditional offer, the employer must provide notice in writing that includes the following:

  • A statement that the conditional offer of employment is contingent upon the review of the individual’s criminal history.
  • A statement that the employer has good cause to conduct a review of criminal history for the specific job position with supporting justification. A general statement without supporting justification is not deemed sufficient.
  • A complete list of all types of information, background, or history that will be reviewed in addition to the applicants’ or employees’ criminal history, including but not limited to education, social media history, employment history, motor vehicle or driving history, reference checks, credit history, license or credential verification, drug testing, or medical examinations.

In obtaining a criminal background check, an employer may not ask the applicant or employee to provide information orally or in writing regarding the applicant or employee’s criminal history, unresolved arrests, or prior convictions, including asking the applicant or employee to fill out a criminal history questionnaire, prior to the employer’s receipt of the criminal background check report.  Such report must be provided to the applicant or employee before an employer discusses any criminal history information, or requests further criminal history information from, the applicant or employee.

If an employer intends to deny an applicant or employee a position of employment, rescind a condition offer, or take any other adverse action against an employee solely or in part because of the applicant’s criminal history, the employer must first conduct an initial individualized assessment that is documented in writing, of whether the applicant’s criminal history has a direct adverse and negative bearing on the applicant’s ability to perform the duties necessary for the position.

Preliminary Notice and Notice of Adverse Action

If after the initial individualized assessment, the employer intends to withdraw or rescind a conditional offer of employment and/or take any other adverse employment action, the employer shall provide the applicant or employee with a preliminary notice of the adverse action, which must be sent by both regular mail and email, if an email address is available, and contain the following:

  • Notice of intent to withdraw or rescind condition offer of employment and/or take any other adverse employment action due to criminal history.
  • An explanation of the applicant’s right to respond to the notice before the decision becomes final, including the waiting periods and timelessness to respond as specified in the FCO.
  • A copy of the initial individualized assessment
  • Notice of the disqualifying convictions
  • A copy of the criminal background check report

The employer must give the applicant or employee five business days to respond to the preliminary notice of adverse action before making a final decision.  The applicant or employee must be given at least ten additional business days either: (a) to respond to the preliminary notice if the applicant notifies the employer in writing that they dispute the accuracy of the background check and is taking steps to obtain evidence or needs additional time to obtain written evidence if rehabilitation or mitigating circumstances, or (b) to present evidence of rehabilitation or mitigating circumstances orally at a meeting between the applicant or employee and the employer.

The employer must consider all of the information and documents, whether written or oral, timely submitted before making a final decision or taking an adverse action and the employer must complete a second individualized assessment.  If after a second individualized assessment, the employer makes the final decision to withdraw the conditional offer or take adverse employment action, the employer shall notify the applicant or employee by both regular mail and electronic mail of the following:

  • Notice that the employer has made a final decision to withdraw the conditional offer
  • A copy of the second individualized assessment
  • Notice of the disqualifying conviction
  • Information regarding existing procedures the employer has for the applicant to challenge the decision or request reconsideration.
  • Notice of the applicant’s or employee’s right to file a complaint with the Los Angeles County Department of Consumer & Business Affairs.

The employer must provide the final notice of adverse action within 30 calendar days after the applicant or employee timely responds to the preliminary notice.  Otherwise, it will be presumed the delay was untimely and in violation of the section. In order to rebut this presumption, the employer must provide a written explanation justifying the delay.

Recordkeeping

Employers must maintain and preserve any and all records relating to this ordinance for a minimum of four years following receipt of an application.

If you have questions about the Los Angeles County Fair Chance Ordinance or related issues with background checks, contact a Jackson Lewis attorney to discuss.