As we move into what many refer to as the holiday season, employers may have questions about handling wages and the holidays. Here are four things for employers to understand about holidays and pay for hourly (non-exempt) employees.

  1. Hours worked on a holiday, Saturdays or Sundays should be treated like hours worked on any other day. This means that employers do not have to pay a special premium for work performed on those days, other than the overtime premium required for work performed in excess of eight hours in a workday, 40 hours in a workweek, or for the first 8 hours worked on the seventh consecutive day. Depending on the number of hours worked each day of the workweek, a double-time premium for work performed may be required.
  2. Employers are not required to provide paid time off for holidays. An employer may be closed for the holidays and not pay employees or choose to operate even on days such as Thanksgiving.  
  3. Paid time off for holidays does not count toward the overtime requirement. If an employer elects to provide paid holidays off, the hours paid but not worked do not count toward overtime.
  4. If payday falls on a holiday, the employer may pay on the next business day after the holiday. Under California law, employers may pay on the next business day after the holiday. The California Government Code identifies the following holidays:
  • January 1 — New Year’s Day
  • Third Monday in January — Martin Luther King Jr. Day
  • February 12 — Abraham Lincoln’s Birthday
  • Third Monday in February — George Washington’s Birthday
  • March 31 – Cesar Chaves Day
  • Last Monday in May — Memorial Day
  • July 4 — Independence Day
  • First Monday in September — Labor Day
  • September 9 – Admission Day
  • Fourth Friday in September – Indigenous Peoples’ Day
  • Second Monday in October — Columbus Day
  • November 11 — Veterans Day
  • Fourth Thursday in November — Thanksgiving Day
  • December 25 — Christmas
  • Other days appointed by the governor for a public fast, thanksgiving, or holiday

If you have questions about handling employee holiday pay, or related issues contact a Jackson Lewis attorney to discuss.

In October, Governor Newsom signed Senate Bill (SB) 476, which requires food facility employers to pay an employee for any cost associated with the employee obtaining a food handler card, considering the time it takes for the employee to complete the training and certification program to be compensable as “hours worked.”

Under the Health and Safety Code, a food handler is required to obtain a food handler card within 30 days of their date of hire and maintain a valid card for the duration of their employment.  A food handler is defined as an individual who is involved in the preparation, storage, or service of food in a food facility, other than an individual holding a valid food safety certificate or an individual involved in the preparation, storage, or service of food in a temporary food facility.

To obtain a food handler card, an individual must complete a food handler training course and examination that meets certain requirements.

Under SB 476, employers are required to consider the time that it takes for an employee to complete the training and examination as compensable “hours worked.” Moreover, employers must reimburse for necessary expenditures.

SB 476 requires that employees are relieved of all other work duties while taking the training course and examination.

Finally, under the new legislation, an employer is prohibited from conditioning employment on the applicant or employee having an existing food handler card.

These changes take effect January 1, 2024.

If you have questions about SB 476 or related issues contact a Jackson Lewis attorney to discuss.

California’s 2023 legislative session ended on October 14, 2023, with a slew of new bills affecting employers. Governor Gavin Newsom signed more than 30 employment-related bills.

Highlights of the new laws affecting employers in California are summarized below. Most of the laws take effect January 1, 2024, unless otherwise indicated.

Read the Full Article on Jackson Lewis’ Legal Updates.

Depending upon many different factors, a state-wide minimum wage has been established for healthcare workers in California which will be phased in over time. On October 13, 2023, Governor Newsom signed Senate Bill (SB) 525, which enacts a multi-tiered statewide minimum wage schedule for health care workers employed by certain covered healthcare facilities. The new law established 5 different minimum wage schedules depending upon the nature of the employer.

This follows several California cities attempting to implement healthcare worker minimum wages. Additionally, the City of Inglewood has enacted a city-wide healthcare minimum wage law.

Categories of Employers

Senate Bill 525 establishes a comprehensive minimum wage schedule for “covered health care employees,” outlining schedules depending on how a facility is classified.   A hospital’s classification is determined by facility size, type, location, and governmental payor mix percentage.  SB 525’s definition of “covered health facility” applies to nearly every type of health care facility except those owned, controlled, or operated by the California Department of State Hospitals, tribal clinics exempt from licensure, and outpatient settings operated by federally recognized Indian tribes.

The law applies to “covered health care employee,” which also encompasses a broad array of positions, from patient care roles like nurses and physicians to support positions such as janitors and clerical workers. The law’s coverage extends to contracted or subcontracted employees when the healthcare facility has control over their wages, hours, or working conditions.

The law, however, excludes outside salespersons, public sector employees not primarily involved in healthcare, and delivery or waste collection workers not directly employed by the healthcare facility.   

In the context of this legislation, the focus is less on whether a healthcare facility is “covered,” as most are, and more on how a facility is classified for the purpose of implementing the phased minimum wage schedules.  SB 525 creates the following four classifications of healthcare employers:

  1. Large Employers and Integrated Health Systems: Covered healthcare facilities that: (1) have 10,000 or more full-time equivalent employees (FTEs); (2) are part of an integrated healthcare delivery system; and, (3) are county healthcare systems with 10,000 or more FTEs or operated by a county with a population of 5,000,000 or more, or (4) that is a dialysis clinic.   

Minimum Wage Schedule

  • From June 1, 2024, to May 31, 2025: $23 per hour
  • From June 1, 2025, to May 31, 2026: $24 per hour
  • From June 1, 2026, until indexed to the lower of inflation or 3.5%: $25 per hour
  1. Hospitals with High Government Payer Mix, Rural Independent Facilities, or County Run Facilities in Low Population Counties: Independent hospitals with elevated governmental payer mix (75% or more), hospitals with a very high governmental payor mix (90% or more), rural independent covered health care facility, or covered health care facilities owned, affiliated, or operated by a county with a population of 250,000 or less.

Minimum Wage Schedule

  • From June 1, 2024, to May 31, 2033: $18 per hour, with 3.5% increases annually.
  • From June 1, 2033, until indexed to the lower of inflation or 3.5%: $25 per hour
  • Primary Care, Free, Community, and Rural Clinics: Primary care clinics, Free clinics not run by governmental entities, community clinics along with their associated intermittent clinics, rural health clinics, and urgent care clinics owned and operated by primary care clinics.

Minimum Wage Schedule

  • From June 1, 2024, to May 31, 2026: $21 per hour
  • From June 1, 2026, to May 31, 2027: $22 per hour
  • From June 1, 2027, until indexed to the lower of inflation or 3.5%: $25 per hour
  1. Other Covered Health Care Facilities: All other covered health care facility employers that don’t fall into the above three categories, including hospitals, skilled nursing facilities as specified, integrated delivery systems, ambulatory surgical centers, urgent care clinics, medical groups, medical foundations, county mental health facilities, and county correctional health facilities.

Minimum Wage Schedule

  • From June 1, 2024, to May 31, 2026: $21 per hour
  • From June 1, 2026, to May 31, 2028: $23 per hour
  • From June 1, 2028, until indexed to the lower of inflation or 3.5%: $25 per hour

Appeals and Waiver Program

For a limited period of time before January 1, 2025, employers will have the ability to challenge the accuracy of the classification of covered health care employers according to the numbers of full-time equivalent employees, system affiliation, payor mix, and any other relevant information with the California Department of Health Care Access and Information.

The Department of Industrial Relations, in consultation with relevant healthcare departments, will also offer waivers to certain healthcare facilities. To be eligible for this waiver, the healthcare facility must prove that compliance with the new wage laws would put its continued operations in jeopardy. Facilities can renew their waivers 180 days before the current one expires.

State Preemption

The bill preempts local ordinances, regulations, or administrative actions that relate to wages, salary, or compensation for covered health care facility employees. Any such local laws enacted after September 6, 2023, are void and cannot be enforced.

If you have questions about SB 525 or related issues contact a Jackson Lewis attorney to discuss.

California’s Governor signed Assembly Bill (AB) 1076 on October 13, 2023, which adds new Business & Professions Code §16600.1, making it unlawful to impose non-compete clauses on employees – which contractual restrictions already are void under Business & Professions Code §16600. 

AB 1076 codifies existing case law in Edwards v. Arthur Andersen LLP (2008) 44 Cal.4th 937, regarding the prohibition on noncompete agreements being broadly construed to void such agreements and clauses in the employment context when they do not meet specific exemptions.

New Section 16600.1 states, in full:

16600.1. (a) It shall be unlawful to include a noncompete clause in an employment contract, or to require an employee to enter a noncompete agreement, that does not satisfy an exception in this chapter.

(b) (1) For current employees, and for former employees who were employed after January 1, 2022, whose contracts include a noncompete clause, or who were required to enter a noncompete agreement, that does not satisfy an exception to this chapter, the employer shall, by February 14, 2024, notify the employee that the noncompete clause or noncompete agreement is void.                                          

(2) Notice made under this subdivision shall be in the form of a written individualized communication to the employee or former employee, and shall be delivered to the last known address and the email address of the employee or former employee.

(c) A violation of this section constitutes an act of unfair competition within the meaning of Chapter 5 (commencing with Section 17200).

AB 1076 follows the passage of another bill reiterating California’s ban on restrictive covenants, Senate Bill 699, which provides that the ban extends to agreements regardless of the state in which it was signed and or the state in which the employee worked.  SB 699 also creates a private right of action.

Under AB 1076, employers must notify current employees and former employees (employed after January 1, 2022), that any noncompete agreement or noncompete clause contained within an agreement the current or former employee signed is void unless the agreement or clause falls within one of the statutory exceptions set forth in Business and Professions Code section 16600, et seq.  

Such notices must be an individualized communication to the employee or former employee, delivered to the last known address and email address the employee provided to the employer, and must be provided by next Valentine’s Day, February 14, 2024.

AB 1076 also provides that a violation of the prohibition on noncompete agreements in employment also constitutes unfair competition under California’s Unfair Competition Law, Business & Professions Code section 17200, et seq.

New Business & Professions Code §16600.1 takes effect on January 1, 2024.

If you have questions about AB 1076 or related issues, contact a Jackson Lewis attorney to discuss.

In December 2022, the City of Berkeley passed the Fair Workweek Employment Standards Ordinance. The ordinance will become operative on January 12, 2024.

The Berkeley ordinance is similar to the City of Los Angeles’s Fair Work Week Ordinance which took effect April 1, 2023,and other local ordinances regarding how employees are scheduled and the flexibility of scheduling provided to employees.

Covered Employers and Covered Employees

The ordinance applies to any employer in the City of Berkeley with 10 or more employees in the city that is:

  • primarily engaged in the building services, healthcare, hotel, manufacturing, retail, or warehouse services industries, and employs 56 or more employees globally; or
  • primarily engaged in the restaurant industry, and employs 100 or more employees globally; or
  • a franchisee primarily engaged in the retail or restaurant industries and is associated with a network of franchises with franchisees employing in the aggregate 100 or more employees globally; or
  •  a not-for-profit corporation organized under Section 501 of the United States Internal Revenue Code in the industries specified under subsection (a)(1), (2), and (3) and employs 100 or more employees globally.

The ordinance applies to non-exempt employees who perform at least two hours of work within Berkeley for a covered employer.

Obligations of Covered Employers

The ordinance includes several obligations for covered employers pertaining to scheduling, including the following:

  • Provide each employee with a good faith estimate in writing of the employee’s work schedule. The employee may submit a written request to modify the estimated work schedule.  A covered employer, in its sole discretion, may accept or reject the employee’s request.  The covered employer is required to notify the employee of the covered employer’s determination in writing prior to or on the commencement of employment.
  • Provide employees with at least two weeks’ notice of their work schedules by doing one of the following:
    • Posting the work schedule in a conspicuous place at the workplace that is readily accessible and visible to all employees; or
    • Transmitting the work schedule by electronic means, so long as all employees are given access to the electronic schedule at the workplace.
  • Provide employees with predictability pay for scheduling changes under certain circumstances.
  • Provide new employees with an initial work schedule prior to or on their first day of employment. Thereafter, the covered employer shall include the new employee in an existing schedule with other employees.
  • Provide an employee written notice of any change to the employee’s posted or transmitted work schedule within 24 hours of a schedule change. This notice requirement shall not apply to any schedule changes the employee initiates.

If you have questions about the Berkeley ordinance or related issues, contact a Jackson Lewis attorney to discuss.

California’s Governor signed Senate Bill (SB) 54, which requires a venture capital company to report annually to the California Civil Rights Department (CRD) on its funding determinations related to companies primarily founded by diverse founding team members.

Under the law, a venture capital company is covered by the requirements if it meets either of the following criteria:

  • Primarily engages in the business of investing in, or providing financing to, startup, early-stage, or emerging growth companies.
  • Manages assets on behalf of third-party investors, including, but not limited to, investments made on behalf of a state or local retirement or pension system.

And meets any of the following criteria:

  • The company is headquartered in California.
  • The company has a significant presence or operational office in California.
  • The company makes venture capital investments in businesses that are located in or have significant operations, in California.
  • The company solicits or receives investments from a resident of California.

Under the new law, covered venture capital companies will be required to report to the CRD on an annual basis starting March 1, 2025, regarding the makeup of founding teams and businesses to which funding is provided by the company.

The statute provides for enforcement by the CRD.

If you have questions about SB 54, or other diversity disclosure requirements, contact a Jackson Lewis attorney to discuss.

Senate Bill (SB) 848, scheduled to go into effect on January 1, 2024, requires employers with 5 or more employees to provide employees who have worked for at least 30 days with up to five days of reproductive loss leave.

Under the new law, it is unlawful for a covered employer to refuse to grant a covered employee with five days of leave following a reproductive loss. As defined by SB 848, a “reproductive loss” includes a miscarriage, failed surrogacy, stillbirth, unsuccessful “assisted reproduction” (such as artificial insemination or embryo transfer), or failed adoption. In the event an employee suffers more than one reproductive loss within a 12-month period, his/her employer is not obligated to grant a total amount of leave in excess of 20 days within 12 months.

An employee must be permitted to take the leave on nonconsecutive days and the leave must be completed within three months of the reproductive loss. The leave time can be unpaid unless the employer has a policy stating otherwise. However, SB 848 authorizes an employee to use certain other leave balances otherwise available to them, including accrued and available paid sick leave. The bill makes leave under these provisions a separate and distinct right from any other right under the California Fair Employment and Housing Act.

The bill also prohibits retaliation against an individual who uses this leave or shares information about the leave and requires employers to maintain employee confidentiality relating to reproductive loss leave. 

Covered Employers

Employers with 5 or more employees are required to provide the leave.  

Covered Employees

In order to be entitled to the leave, employees must have been employed for at least 30 days prior to the commencement of the leave.

Reproductive Loss Defined

Under the new law, reproductive loss includes a failed adoption, failed surrogacy, miscarriage, stillbirth, or an unsuccessful assisted reproduction.

If you have any questions about SB 848 or related issues, a Jackson Lewis attorney will be happy to help answer your questions or tailor your Company’s policies to ensure compliance with the new law.