In 2016 California passed legislation that employers who do not sponsor an employee-retirement plan must participate in a state-run retirement program. This program became known as CalSavers.

While there have been legal challenges to CalSavers, the program persists. CalSavers provides an opportunity for employees to defer wages, through payroll deductions by the employer, to a state-run individual retirement savings account program.

An employer is not required to participate in CalSavers if it sponsors or participates in a retirement plan such as a 401(k) plan or pension plan. To be exempt from CalSavers, an employer may sponsor a retirement plan for any of its employees; California employees need not enroll in the retirement plan for the employer to be exempt.

Previously, under the statute “eligible employer” was defined as a person or entity engaged in a business, industry, profession, trade, or another enterprise in the state, excluding specified federal, state, and local governmental entities, with 5 or more employees and that satisfies certain requirements to establish or participate in a payroll deposit retirement savings arrangement.

On August 26, 2022, Governor Newsom signed Senate Bill (SB) 1126, which expands the definition of eligible employer to include a person or entity, as described above, that has at least one eligible employee and that satisfies the requirements to establish or participate in a payroll deposit retirement savings arrangement, and would additionally exclude from the definition of “eligible employer” sole proprietorships, self-employed individuals, or other business entities that do not employ any individuals other than the owners of the business.

Also, the bill requires that eligible employers with 5 or more employees that do not offer a retirement savings program, to have a payroll deposit saving arrangement to allow employee participation in the program within 36 months after the board opens the program for enrollment. Moreover, by December 31, 2025, all eligible employers with one or more employees would need to have a payroll deposit savings arrangement, if they do not provide a retirement savings program.

If employers have questions about California’s retirement plan mandate or about employee benefits, contact a Jackson Lewis attorney to discuss.

On June 15, 2022, the U.S. Supreme Court ruled in Viking River Cruises, Inc. v. Moriana that bilateral arbitration agreements governed by the Federal Arbitration Act (FAA) may require arbitration of California Private Attorneys General Act (PAGA) claims on an individual basis only.

In early July, Moriana, the named plaintiff-employee at the center of Viking River Cruises, filed a petition for rehearing with the Court. Moriana argued that the Court’s opinion went beyond the federal question presented and involved the unbriefed issue of state-law contract interpretation and statutory construction that exceeded the Court’s authority.

On August 22, 2022, the high court denied the request for rehearing and issued a final judgment, leaving intact the Court’s analysis of the severability language in Viking River Cruise’s arbitration agreement, as well as the Court’s analysis of statutory standing under PAGA.

While the U.S. Supreme Court’s opinion is now final, the California Supreme Court has granted review in several cases pertaining to employment arbitration agreements and PAGA.  Through these cases, the California Supreme Court may shed additional light on when a plaintiff maintains statutory standing under PAGA.

The enforceability of arbitration agreements in California continues to evolve in other areas as well.  Notably, recently the Ninth Circuit withdrew its opinion pertaining to Assembly Bill (AB) 51 and granted a panel rehearing  of the appeal.  AB 51 is California’s law that purports to prohibit employers in California from requiring employees to sign as a condition of employment or employment-related benefits arbitration agreements concerning disputes arising under the California Fair Employment and Housing Act or California Labor Code. The Ninth Circuit’s move may indicate a likelihood that the Court will conclude the FAA preempts AB 51 in its entirety, potentially giving employers in California the green light to condition employment or employment-related benefits upon an employee’s signing an arbitration agreement.

Jackson Lewis will continue to track cases regarding arbitration agreements and PAGA. If you have questions about employment arbitration agreements in California or related issues, contact a Jackson Lewis attorney to discuss.

Cal/OSHA’s outdoor heat illness prevention standard is well known by employers with employees who commonly work outside. And while there is no official indoor heat illness standard, employers still need to consider heat hazards when evaluating workplace safety, especially in light of Fed/OSHA’s National Emphasis Program (“NEP”) for Outdoor and Indoor Heat-Related Hazards.

Although Cal/OSHA has been working on a proposed standard to cover Heat Illness Prevention in Indoor Places of Employment since 2017, to date the standard has not been approved. Despite no formal standard, Cal/OSHA is stepping up enforcement of indoor heat hazards, presumably due to the NEP, under California’s version of the General Duty Clause: Title 8 Cal. Code Regs., Section 3203.

Section 3203 requires employers to, among other things, identify and evaluate workplace hazards, and correct unsafe or unhealthy conditions based on the severity of the hazards. Employers should document their assessment pursuant to Section 3203.

In assessing indoor heat hazards, employers should consider the following issues:

  • High air temperature
  • High level of humidity
  • Poor air movement
  • Radiant heat sources such as furnaces or machinery

As with other workplace hazards, if heat hazards are identified indoors, employers should consider developing a written plan to protect employees and should include items such as training, personal protective clothing or equipment, engineering controls, administrative measures, and other measures to mitigate potential harm to employees. Although California employers may already have plans in place for employees who work outdoors, a written plan for indoor workers is a good idea, especially with increased enforcement by Cal/OSHA.

If you have questions about indoor heat or related workplace safety issues, please reach out to the Jackson Lewis attorney with whom you often work or any member of our Workplace Safety and Health Team.

The current Cal/OSHA COVID-19 Emergency Temporary Standard (ETS) expires at the end of 2022. But Cal/OSHA is not done with COVID-19 regulations. There is a Non-Emergency Regulation in process. The Standards Board recently published its proposed non-emergency regulation and announced a public hearing for September 15, 2022.

Though the proposal is a non-emergency regulation, the proposed text states the requirements would only remain in effect for two years, except for certain recordkeeping requirements.

Here are other highlights of the proposed regulation:

  • Directs employers to include COVID-19 procedures in their written Injury and Illness Prevention Program (IIPP) or as a separate document.
  • As part of an employer’s COVID-19 procedures, an employer must provide training to employees regarding COVID-19
  • Employers must have effective methods and procedures for responding to COVID-19 cases in the workplace such as exclusion and quarantine requirements.
  • Employers will still have certain notice requirements regarding positive cases in the workplace.
  • Face covering requirements shall still follow California Department of Public Health requirements

One notable omission from the proposed regulation is exclusion pay, which was a very contentious requirement under the ETS.

Jackson Lewis will continue to track developments regarding Cal/OSHA’s non-emergency COVID-19 regulation. If you have questions about COVID-19 workplace safety or related issues contact the Jackson Lewis attorney with whom you often work or any member of our Workplace Safety and Health Team.

A bill to increase pay transparency in California steps closer to becoming law.

Senate Bill 1162, introduced in February and with some amendments since its initial form, passed the Assembly Appropriations Committee on August 11. Only a few steps are left before it could become law this legislative session: (1) a full Assembly vote; (2) reconciliation with the Senate; and (3) the governor’s signature.

SB 1162 continues to focus on enhanced pay transparency. In its current form, the bill requires employers with at least 15 employees to include the position’s pay scale in any job posting, including those posted through a third party. This reflects larger pay transparency trends nationally, including the requirements in Colorado, New York City, and Washington. The California bill also requires employers to provide the pay scale for a position to applicants and employees upon request.

Read the full article on Jackson Lewis’ Pay Requity Advisor Blog.

On June 15, 2022, the U.S. Supreme Court ruled in Viking River Cruises, Inc. v. Moriana that bilateral arbitration agreements governed by the Federal Arbitration Act (FAA) may require arbitration of California Private Attorneys General Act (PAGA) claims on an individual basis only.

However, Justice Sotomayor’s concurring opinion in Viking River Cruises also seemingly included an invitation for California’s legislature and courts to clarify standing issues related to PAGA actions when an employee is required to arbitrate their individual PAGA claims in accordance with an enforceable arbitration agreement.

The California Supreme Court has accepted this invitation and agreed to review several cases on the issue, including Wing v. Chico Healthcare & Wellness Centre (Wing) and Sanchez v. MC Painting (Sanchez).  The specific question presented in these cases is: whether an aggrieved employee who has been compelled to arbitrate claims under PAGA that are premised on Labor Code violations actually sustained by the aggrieved employee maintains statutory standing to pursue PAGA claims arising out of events involving other employees in court or in any other forum the parties agree is suitable.

In Wing, the employee agreed to an alternative dispute resolution policy as a condition of her employment. The policy included a waiver of class or representative actions. The employee then filed a complaint that included PAGA claims. The employer asked for the PAGA claims to be stayed while the individual claims proceeded to arbitration, but the employee refused. The trial court subsequently denied the employer’s motion to compel arbitration of the PAGA claims, and the California Court of Appeal upheld the denial based on California Supreme Court precedent in Iskanian v. CLS Transportation Los Angeles LLC, which held that an employee’s right to pursue a representative PAGA action cannot be waived, and this conclusion was not preempted or foreclosed by the FAA.

In Sanchez, the employee signed an arbitration agreement at the time of hire, which included language that all issues of validity, enforcement, and interpretation of the agreement would be governed by the FAA and that the employee waived the right to bring representative actions. As in Wing, the employer appealed the trial court’s denial of a petition to compel arbitration of a PAGA claim based on the California Supreme Court’s reasoning in Iskanain.

The California Supreme Court has clearly signaled its intention to clarify Iskanian’s status in light of the U.S. Supreme Court’s decision in Viking River Cruises, Inc. v. Moriana. In the meantime, we also await the high court’s decision regarding a potential rehearing in Viking River Cruises.

Jackson Lewis will continue to track cases regarding arbitration agreements and PAGA. If you have questions about employment arbitration agreements in California or related issues, contact a Jackson Lewis attorney to discuss.

In June, the City of Los Angeles passed an ordinance designed to increase safety protections for hotel workers in hotels, limit daily workload, and raise hotel worker wages.

The new ordinance took effect on August 12, 2022.

Under the ordinance, a hotel employer must place on the back of the entrance door to each guest room and restroom facility in a hotel a sign written in a font size of no less than 18 points, that includes the heading “The Law Protects Hotel Workers From Threatening Behavior.”

Moreover, hotel employers must provide written notice of the rights set out in the ordinance to each hotel worker at the time of hire or within 30 days of the effective date of the ordinance.

The City of Los Angeles Office of Wage Standards has posted model notices for both postings and providing to employees in both English and Spanish. The following are links to the model notices required under the law:

The City of Los Angeles also published regulations pertaining to the ordinance that covers the following:

  • Determining who is a hotel employer
  • Determining who is a hotel worker
  • Specifying which aspects of the ordinance apply to which hotel employers, based on
  • Security protection for hotel workers
  • Rights related to the personal safety device
  • Measures for fair compensation
  • Exemptions and waiver
  • Enforcement
  • Retaliation

If you have questions about the Los Angeles Hotel Workers Protection Ordinance, whether similar provisions apply in other jurisdictions or related issues, you may contact the author of this article or the Jackson Lewis attorney with whom you regularly work.

California’s Healthy Workplace, Healthy Family Act (the Act) requiring most employers to provide paid sick leave for covered employees went into effect in 2015. However, in 2017 and 2021, two separate California federal district courts concluded that the Act was not applicable to rail workers due to preemption by the federal Railroad Unemployment Insurance Act (RUIA). The RUIA is a federal law that provides the exclusive source of unemployment and sickness benefits to railroad employees.

On July 26, 2022, the U.S. Court of Appeals for the 9th Circuit in National Railroad Passenger Corp, et al. v. Su upheld the district court rulings. The question before the court was whether the RUIA preempted California law as to rail workers. The 9th Circuit stated that the RUIA contains an express preemption provision disallowing railroad employees from having any right to sickness benefits under a sickness law of any State. Given that the Act provides sickness benefits, the Act falls within the express terms of the RUIA preemption.

The 9th Circuit indicated the California Labor Commissioner’s argument that the Act should not be preempted because it offers a different kind of benefit than the RUIA was unpersuasive.

If you have questions about California’s paid sick leave coverage or related issues, contact a Jackson Lewis attorney to discuss.

California voters almost had the opportunity to vote on an $18 minimum wage in November 2022. The State has a unique administrative process by which California citizens can propose laws and constitutional amendments without the support of the state government.

The $18 an hour proposition called, “The Living Wage Act of 2022,” was intended to be put before California voters in November 2022. It proposed to continue the State’s stair-step increase of the minimum wage as follows:

Year Employers with 25 or fewer employees Employers with 26 or more employees
2023 $15.00 per hour $16.00 per hour
2024 $16.00 per hour $17.00 per hour
2025 $17.00 per hour $18.00 per hour
2026 $18.00 per hour $18.00 per hour

However, this proposed timeline will now need to be adjusted as The Living Wage Act failed to qualify for the 2022 ballot due to the late submission of verified signatures to the California Secretary of State.  The Proposition has been cleared for the 2024 ballot.

Advocates of the measure filed a lawsuit pushing to place the Proposition on the 2022 ballot, but the court found the proponents’ arguments “unpersuasive.”

A separate Proposition aimed at amending the California Private Attorneys General Act (PAGA) was also delayed until November 2024.

Jackson Lewis continues to track legislation, regulations, and ballot measures affecting employers. If you have questions about minimum wage compliance or related issues, contact a Jackson Lewis attorney to discuss.

In March 2022, the California Department of Public Health (CDPH) dropped universal indoor masking, though masking was still required in certain places. By April 2022, most counties had also ceased universal indoor masking requirements. However, recently, the Los Angeles County Department of Public Health (LACDPH) stated if the uptick in cases and hospitalizations continued, then the County would implement a new indoor universal mask mandate effective July 29, 2022.

On July 28, 2022, the LACDPH announced it would not proceed with a new universal masking mandate due to a reduction in transmission and hospitalizations. However, LA County’s current order still requires masks in the following situations:

  • On all forms of public transportation in LA County. This includes trains, buses, taxis, and ride-shares.
  • In all indoor transportation hubs in LA County, including airport and bus terminals, train and subway stations, seaports or other indoor port terminals, or any other indoor area that serves as a transportation hub.
  • In healthcare settings
  • In long-term care settings and adult/senior care facilities
  • In state and local correctional facilities and detention centers
  • Shelters and cooling centers

Currently, no counties in California require indoor universal masking. However, employers should review state and local orders to determine if different requirements apply to their industry.

Employers should also be aware that in certain circumstances, employees may be required to wear a face covering after testing positive for COVID-19, having a close contact with someone who has tested positive, or during an outbreak.

If you have questions about current mask requirements or issues related to COVID-19 in the workplace, contact a Jackson Lewis attorney to discuss.