On September 30, 2020, Governor Newsom signed Assembly Bill 1947, which extends the period to file a discrimination or retaliation complaint to one year with the California Division of Labor Standards Enforcement (“DLSE”) or better known as the Labor Commissioner. Before the passage of this legislation, employees alleging they had been discharged or otherwise discriminated against in violation of any law enforced by the California Labor Commissioner were required to file a complaint with the Division of Labor Standards Enforcement within 6 months after the occurrence of the violation. The Labor Commissioner was required to commence an action to enforce labor standards within 3 years of their accrual.

The extension of the statute of limitations from 6 months to one year is applicable to claims for discrimination or retaliation against an employee regarding any law enforced by the DLSE. Employers should also be aware that there are different statute of limitations for employees to bring other types of claims at the DLSE. For example, an employee has three years to bring a claim for unpaid wages.

There may be an increase in employee claims for violations of Labor Code 1102.5. The statute also now authorizes reasonable attorney’s fees to a plaintiff who brings a successful action for violation of Labor Code 1102.5. Labor Code 1102.5 prohibits an employer from making or enforcing any rule, regulation, or policy that prevents employees from disclosing information that the employee reasonably believes is a violation of state or federal statute, or a violation of or noncompliance with a local, state, or federal rule or regulation.

Jackson Lewis will continue tracking state legislation that is relevant to employers. If you have questions about the effects of this or other recent legislation contact a Jackson Lewis attorney to discuss.

Governor Newsom signed Assembly Bill 2399 on September 30, 2020, which extended the definitions for Paid Family Leave under Sections 3302 and 3307 of the Unemployment Insurance Code to include additional coverage for active military members and their families.  The existing state Paid Family Leave program provided wage replacement benefits to workers who take time off to care for a seriously ill family member or bond with a minor child within one year of birth or placement.  Effective January 1, 2021,  Paid Family Leave will expand to now include a third category of covered time off for participation in a qualifying exigency related to the active duty or call to active duty of the individual’s spouse, domestic partner, child, or parent in the Armed Forces of the United States.

Existing law under other classifications required certain documentation of a qualifying exigency, including a copy of new active duty orders or other documentation, and this law will provide that new documentation requirement would now apply to a need for Paid Family Leave because of a qualifying exigency.

The new law revises definitions for the purpose of the qualifying exigency provisions, including “care recipient,” “care provider,” and “family care leave” and adds a definition of “military member.”

Jackson Lewis will keep tracking state legislation relevant to employers.  If you have questions about the effects of this or other recent legislation contact a Jackson Lewis attorney to discuss.

In a continued effort to reduce gender and racial pay gaps, on September 30, 2020, California Governor Gavin Newsom signed into law Senate Bill 973, which creates massive pay reporting requirements for employers.  In 2021, certain California employers will be required to submit annual information on its employees’ pay data by gender, race, and ethnicity to the state’s Department of Fair Employment and Housing (DFEH).  A similar bill was introduced last year (following the EEOC’s court battle), but it failed to clear the necessary hurdles before the end of the legislative session. This year, however, it crossed the finish line.

Specifically, the new law requires employers, (a) with 100 or more employees; and (b) that must file an annual Employer Information Report (EEO-1) under federal law, to submit an annual report to the DFEH that includes the number of employees (and the hours they worked):

  1. By race, ethnicity, and sex;
  2. In each of the Job Categories in the federal EEO-1 Report; and
  3. Whose annual earnings fall within each of the pay bands used by the United States Bureau of Labor Statistics in the Occupational Employment Statistics survey.

Employers with multiple establishments must submit a report for each establishment and a consolidated report that includes all employees.  The first report is due to March 31, 2021.

The journey to this new California requirement began in January 2016, when the EEOC announced a revision to the EEO-1 Report to include disclosure of aggregate employee pay data by gender, race, and ethnicity.  The EEOC required employers to begin using the new EEO-1 Report (including pay data) in 2018.  But, in 2017, the Trump Administration postponed this pay data collection indefinitely.  Pay equity advocates challenged this decision, and the Court ordered EEOC to reinstate the collection for the 2017 and 2018 filing years (filed jointly in 2019).  EEOC is currently studying the quality and utility of the pay data it collected.  In the meantime, the EEOC concluded that the burden on employers “far outweigh[s]” the pay data’s “unproven utility” and discontinued all pay data collection efforts.

With this new law, it appears the Golden State balances these interests differently.  According to the legislature, California believes continued data collection will permit the state to “more efficiently identify wage patterns and allow for targeted enforcement of equal pay or discrimination laws.”  Time will tell.

But until then, California employers have a new annual reporting obligation that mirrors the former EEO‑1 pay data report.  Just about everything else, however, is less clear:  What will the form look like?  How many employees must an employer have in California to be covered?  And if an employer is covered, must it report on workforces outside of California as well? 

While there are some uncertainties, there is hope that the state will release additional guidance to assist employers with compliance.

We encourage employers who are interested in taking steps to ensure their pay systems are equitable to contact Jackson Lewis’s Pay Equity Resource Group.

On September 30, 2020, Governor Newsom signed Assembly Bill (“AB”) 979, which requires publicly held corporations headquartered in California to diversify their boards of directors with directors from “underrepresented communities” by December 31, 2021. This bill is similar to Senate Bill 826, signed into law in 2018, which required publicly held corporations headquartered in California to include women on their boards.

AB 979 defines “director from an underrepresented community” as “an individual who self-identifies as Black, African American, Hispanic, Latino, Asian, Pacific Islander, Native American, Native Hawaiian, or Alaska Native, or who self-identifies as gay, lesbian, bisexual, or transgender.”  Foreign and domestic publicly held corporations with principal executive offices in California must have at least one director from an underrepresented community on their boards by December 31, 2021.  By December 31, 2022, covered corporations with boards of nine or more directors must have a minimum of three directors from underrepresented communities on their boards, and covered corporations with boards of more than four but less than nine directors must have a minimum of two directors from underrepresented communities.  Corporations may increase the number of directors on their boards to comply with these requirements.

Starting no later than March 1, 2022, the California Secretary of State will publish annual reports on its website documenting compliance with these diversification requirements. Companies that fail to timely comply will be fined $100,000 for the first violation and $300,000 for subsequent violations.

Takeaways

Similar to SB 826, which required gender diversity on boards, AB 979 will likely be challenged on constitutional and other grounds.  Nonetheless, covered corporations and their boards of directors should begin planning for the December 31, 2021 compliance deadline.  Moreover, AB 979 provides covered corporations an opportunity to complement existing diversity and inclusion strategies if the changes are implemented with intentionality by selecting candidates that fit the organization’s business needs and help the organization achieve its diversity and inclusion goals.

Jackson Lewis will continue tracking state legislation that is relevant to employers. If you have questions about the effects of this or other recent legislation contact a Jackson Lewis attorney to discuss.

California law already prohibits employers from taking certain employment actions against an employee for refusing to work in some circumstances where there is a real or apparent safety hazard to the employee or other employees. On September 29, 2020, Governor Newsom signed Assembly Bill 2568, which extends that protection to include domestic work employees or employees that perform household services for an individual, such as cleaning, household maintenance, cooking, laundry, ironing, provide care for others, or run household errands.  Before the passage of this legislation, household domestic service workers were not viewed as having the same protections as other employees under California law because of how the concept of an employee was defined in California’s labor code.

This law impacts both individuals and businesses who employ domestic service workers in three important ways.  First, Labor Code section 6310 now explicitly prohibits employers from retaliating against domestic work employees who either (i) complain to a government agency responsible for ensuring employee health and safety (e.g., Division of Occupational Safety and Health (“Cal OSHA”)); (ii) initiate or participate in a proceeding relating to employee health and safety (e.g., participate in a Cal OSHA investigation or inspection or participate in a health and safety committee); (iii) report a work-related fatality, injury, or illness; or (iv) request access to occupational injury or illness reports and records.

Second, Labor Code section 6311 prohibits employers from laying off or terminating domestic work employees who refuse to work in violation of an occupational health and safety law that creates a “real and apparent” hazard to the employee or to fellow employees.  Labor Code section 6310 and 6311 exclude, however, employees who perform household domestic service that is publicly funded.

Third, Labor Code 6311.5 now prohibits employers from “willfully and knowingly” directing a domestic work employee to remain in or enter an area that poses a public health or safety concern.   An employer’s violation of this provision in the Labor Code constitutes a misdemeanor and is subject to criminal penalties under California’s Penal Code.

Following the passage of this legislation, businesses, such as staffing agencies, who employ nannies, childcare providers, caregivers, personal attendants, housekeepers, cooks, and other household workers can face significant liability for a violation of the Labor Code, including civil liability for damages from lost wages, and criminal penalties.

Jackson Lewis will continue tracking state legislation that is relevant to employers. If you have questions about the effects of this or other recent legislation contact a Jackson Lewis attorney to discuss.

On September 29, 2020, Governor Newsom signed Assembly Bill 2537, which significantly expands upon employers’ existing baseline obligations for providing a safe and healthful work environment.  The new bill creates specific requirements regarding general acute care hospitals’ distribution and supply of personal protective equipment (PPE).  Its purpose is to protect healthcare workers from COVID-19.

Before the passage of this legislation, California broadly required that employers provide safe and healthful places of employment and to maintain effective injury prevention programs.  The new statute, applies to both public and private employers, operating general acute care hospitals as defined in California Health and Safety Code Section 1250(a).   Under the statute, general acute care hospitals are required to provide PPE to their employees who provide direct patient care or provide services directly supporting personal care.

The bill also requires those employers to maintain specific stockpiles of specified respirators, particulate filters or cartridges, surgical masks, isolation gowns, eye protection, and shoe coverings. Specifically, beginning April 1, 2021, those employers must maintain a 3-month supply of the specified equipment.  Further, the bill requires employers to establish and implement effective written procedures for periodically determining the quantity and types of equipment used in its normal consumption.

In addition, general acute care hospitals must be prepared to report their highest 7-day consecutive daily average consumption of PPE during the 2019 calendar year to the Department of Industrial Relations.  Employers violating the PPE supply requirement may incur a civil penalty of up to $25,000 for each violation.  However, hospitals may not incur the penalty if the failure to meet the requirements is due to issues beyond their control.

Jackson Lewis will continue tracking state legislation that is relevant to employers. If you have questions about the effects of this or other recent legislation contact a Jackson Lewis attorney to discuss.

On September 29, 2020, the Governor signed Assembly Bill 1963 which amends Section 11165.7 of the Penal Code, relating to mandated reporters of child abuse.

The existing law, the Child Abuse, and Neglect Reporting Act, requires a mandated reporter, as defined, to report whenever they, in their professional capacity or within the scope of their employment, have knowledge of or observed a child whom the mandated reporter knows or reasonably suspects has been the victim of child abuse or neglect.  Failure by a mandated reporter to report an incident of known or reasonably suspected child abuse or neglect is a misdemeanor punishable by up to six months of confinement in a county jail, by a fine of $1,000, or both.  Under existing law, employers are strongly encouraged to provide their employees who are mandated reporters with training in these duties, including training in the identification and reporting of child abuse and neglect.

This bill adds a human resource employee of a business with five or more employees that employ minors to the list of individuals who are mandated reporters.  The bill also adds, for the purposes of reporting sexual abuse, an adult whose duties require direct contact with and supervision of minors in the performance of the minors’ duties in the workplace of a business with five or more employees to the list of individuals who are mandated reporters.  The bill requires those employers to provide their employees who are mandated reporters with training on identification and reporting of child abuse and neglect.  By imposing the reporting requirements on a new class of persons, for whom failure to report specified conduct is a crime, this bill would impose a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state.  Statutory provisions establish procedures for making that reimbursement.  This bill provides that no reimbursement is required by this act for a specified reason.

What does this bill mean for California employers?

Any California employer with five or more employees that employ minors will have to provide training on identification and reporting of child abuse and neglect to the following two new classes of mandated reporters – (1) all human resources employees and (2) all adults whose duties require direct contact with and supervision of minors in the performance of the minors’ duties in the workplace.

Also, although this new law imposes a state-mandated local program on local agencies and school districts by requiring training on identification and reporting of child abuse and neglect, California employers who are subject to this new law will not be able to seek reimbursement for the costs of such training.

Jackson Lewis will continue tracking state legislation that is relevant to employers. If you have questions about the effects of this or other recent legislation contact a Jackson Lewis attorney to discuss.

On September 28, 2020, Governor Newsom signed Assembly Bill 1731 (“AB 1731”), which creates an alternative process for employers to submit and be approved for work-sharing plan programs. Previously some employees would be eligible for unemployment benefits if they were working less than their usual weekly hours and their employer was participating in a work-sharing plan that met specified requirements and was approved by the Director of Employment Development. Employers were required to submit to the director a signed, written work-sharing plan application form that met specific requirements.

AB 1731 mandates that the Director of Employment Development must accept an application to participate in, or renew participation in, the work-sharing program that is submitted electronically and would require the Employment Development Department (“EDD”) to create a portal on its website for the receipt of applications for work share. Moreover, for work-sharing plan applications submitted by eligible employers between September 15, 2020, and September 1, 2023, the bill requires that, upon approval by the director, they are deemed approved for one year, except as specified. The bill also requires the EDD to make online claim forms available to the approved employer for each participating employee within five business days following approval of the application if an employer submitted its work-sharing plan application online. Upon completion of the documents in the claim packet, the department would establish an unemployment insurance claim pursuant to applicable requirements.

Jackson Lewis will continue tracking state legislation that is relevant to employers. If you have questions about the effects of this or other recent legislation contact a Jackson Lewis attorney to discuss.

On September 28, 2020, Governor Newsom signed Senate Bill 1384, which (1) expands the California Labor Commissioner’s representation to arbitrations for claimants who cannot afford counsel, (2) requires employers to serve petitions to compel arbitration on the Labor Commissioner, and (3) allows the Labor Commissioner to represent claimants in proceedings to determine whether arbitration agreements are enforceable.

SB 1384 modifies Labor Code section 98.4, which previously provided only that the Labor Commissioner could represent indigent claimants in de novo proceedings (appeals of Labor Commissioner wage claim awards).  SB 1384 keeps Section 98.4’s original language but adds two new subparts, which provide at (b) and (c), respectively:

  • Where a claimant cannot have their wage claim adjudicated by the Labor Commissioner under Sections 98 and 98.1 due to a court order compelling arbitration, at the claimant’s request, the Labor Commissioner must represent the claimant in the arbitral proceeding if (1) the claimant is financially unable to afford counsel, and (2) the Labor Commissioner determines, upon conclusion of an informal investigation, that the claim has merit; and
  • Petitions to compel arbitration of Section 98, 98.1, or 98.2 claims must be served on the Labor Commissioner and, upon request, the Labor Commissioner may represent claimants in proceedings to determine the enforceability of the arbitration agreement (regardless of whether arbitrability is determined by a judge or an arbitrator).

Going forward, employers will need to be sure to serve petitions to compel arbitration of Section 98, 98.1, and 98.2 wage claims on the Labor Commissioner and can expect to see an increase in challenges to the arbitration of such claims, as well as increased legal representation in the arbitration of such claims.

The subpart (b) provision regarding the Labor Commissioner’s informal investigation to determine the claim’s merits is a new provision for which there is presently no specific precedent or guidance.  Jackson Lewis will track how this investigation provision is applied and will continue tracking state legislation that is relevant to employers. If you have questions about the effects of this or other recent legislation contact a Jackson Lewis attorney to discuss.

On September 28, 2020, Governor Newsom signed Assembly Bill 2017, which revises Labor Code § 233 (also known as the “Kin Care” law) to provide that an employee has the right to designate sick leave as for kin care; or for the employee’s own health condition or for obtaining relief if the employee is a victim of domestic violence, sexual assault, or stalking. As such, employers should revise sick leave policies to ensure that employees are aware of their right to designate.

By way of background, employers are currently required to permit employees to take up to half of their accrued sick leave to care for a family member (also known as “kin care”). “Family member” for purposes of kin care is defined by Labor Code §§ 233 and 245.5(c) to include an employee’s child, parent or guardian, spouse or registered domestic partner, grandchild, grandparent, and sibling.

To avoid an employer’s erroneous designation of the use of sick days as kin care (and the depletion of kin care) when the sick days were actually taken for personal sick leave, Assembly Bill 2017 provides employees with the right to designate what type of sick days they are taking.

Assembly Bill 2017 does not alter Labor Code § 233 insofar as employers remain prohibited from taking discriminatory action against an employee for requesting or using sick leave.

Any employee aggrieved by a violation of these provisions is entitled to reinstatement and actual damages or one day’s pay, whichever is greater, and to appropriate equitable relief.

Jackson Lewis will continue tracking state legislation that is relevant to employers. If you have questions about the effects of this or other recent legislation, please contact a Jackson Lewis attorney to discuss.