On February 19, 2022, the newest statewide COVID-19 Supplemental Paid Sick Leave took effect.

California’s Division of Labor Standards Enforcement (DLSE) has published an FAQ Page to provide guidance regarding COVID-19 Supplemental Paid Sick Leave (SPSL).

The new FAQ page covers questions pertaining to the following:

  • Reasons for Taking Leave
  • Start Date and End Date
  • Requesting Leave from An Employer
  • Calculating an Employee’s Hours of Leave
  • Permissive Limits on Use and Verification
  • Credits
  • Payment of Leave, Record-Keeping, and Paystubs
  • Enforcement
  • Relation to Other Laws

There is some information in the FAQs that employers should take special note of.

Retroactive Payment

Retroactive payments are only required if the covered employee requests retroactive time for qualified absences prior to February 19, 2022.

Employers may request documentation if the employee is requesting retroactive leave for the employee or a qualifying family member testing positive for COVID-19.

This documentation could include, among other things, a medical record of the test result, an e-mail or text from the testing company with the results, a picture of the test result, or a contemporaneous text or e-mail from the employee to the employer stating that the employee or a qualifying family member tested positive for COVID-19.

If retroactive payment is being sought from the hours that an employee may use for any other qualifying reason employer may not deny a worker 2022 COVID-19 Supplemental Paid Sick Leave based solely on a lack of certification from a health care provider.

Wage Statement

The itemized wage statement or separate writing requirement ensures covered employees understand how many separate hours they have used for 2022 COVID-specific sick leave. The 2022 SPSL differs from the 2021 SPSL in that the paystub must list what has been used instead of what is available to use.  If no hours have yet been used then the paystub or other writing issued at the time wages are paid must indicate 0.

In addition, Labor Code Section 247.5 requires that records be kept for a three-year period on regular paid sick days and 2022 SPSL days accrued and used and that the records be made available to the Labor Commissioner or employee upon request.

Notice Requirement

Under California law, employers are required to display the required poster about 2022 SPSL in a place at the worksite where employees can easily read it.

If an employer’s covered employees do not frequent a workplace, the employer may satisfy the notice requirement by disseminating notice through electronic means.

If you have questions about 2022 COVID-19 Supplemental Paid Sick Leave or related issues, contact a Jackson Lewis attorney to discuss.

Last year, a divided Ninth Circuit panel found that the Federal Arbitration Act (FAA) did not completely preempt Assembly Bill (AB) 51, California’s ban on mandatory arbitration agreements. The U.S. Chamber of Commerce then filed a petition for rehearing en banc (Petition), which has been pending before the Ninth Circuit since October 2021.

On February 14, 2022, the Ninth Circuit issued an order deferring consideration of the Petition until the U.S. Supreme Court rules on Viking River Cruises, Inc. v. Moriana.  In Viking River Cruises, the U.S. Supreme Court will decide whether the FAA requires enforcement of representative action waivers in bilateral arbitration agreements, including waivers of claims brought under California’s Private Attorneys General Act (PAGA).

Although both Viking River Cruises and the legal challenge to AB 51 involve employment arbitration agreements, Judge Sandra Ikuta voted against the deferment, stating that Viking River Cruises does not raise issues relevant to the Petition.

Regardless, the wait for a decision will not be long as the U.S. Supreme Court has scheduled oral argument in Viking River Cruises for March 30, 2022. In the meantime, the preliminary injunction staying enforcement of AB 51 remains in effect pending a decision by the Ninth Circuit on the Petition, although employers should keep their eye on federal legislation awaiting President Biden’s signature that invalidates arbitration agreements and class action waivers related to sexual harassment and sexual assault claims.

Jackson Lewis attorneys will continue to track developments pertaining to employment arbitration agreements. If you have questions about these cases or issues related to arbitration agreements, contact a Jackson Lewis attorney to discuss.

On February 19, 2022, 2022 COVID-19 Supplemental Paid Sick Leave goes into effect. The legislation, similar to 2021 COVID-19 Supplemental Paid Sick Leave, requires employers with 25 or more employees to provide paid leave for reasons related to COVID-19, including the need to isolate or quarantine or to care for a family member who needs to isolate or quarantine.

The new statute also requires employers to post a notice regarding the new leave entitlement. The Division of Labor Standards Enforcement (DLSE) has published a model notice, which details the reasons leave is permitted and the amount of leave employees are entitled to take.

If employees do not frequent a physical workplace, the notice may be sent to employees electronically. This aligns with a law passed last year permitting the distribution of required postings via email to employees in addition to posting at the worksite.

The DLSE is also going to publish an FAQs page regarding the new leave, though currently the page only indicates “updates are coming soon.”

If you have questions about 2022 COVID-19 Supplemental Paid Sick Leave or related issues, contact a Jackson Lewis attorney to discuss.

In a recent decision, Peck v. Swift Transportation, the 9th Circuit dismissed an objector’s appeal of the district court’s approval of a Private Attorney General Act (PAGA) settlement.

The parties reached a proposed class and PAGA settlement. A truck driver who was not a party to the action, Lawrence Peak (Peak), objected to the PAGA settlement. The district court overruled Peak’s objection to the PAGA settlement.

On appeal, the 9th Circuit held Peak could not maintain the appeal because he was not a party to the underlying PAGA action. The 9th Circuit panel held Peak failed to demonstrate that he had a right to appeal the district court’s approval of the PAGA settlement; as one of the justices stated at oral argument, Peak was “late to the party”.

The panel rejected Peak’s arguments as to why he may appeal the PAGA settlement. While Peak was a class member in the class action, a PAGA action is distinct from a class action, and objectors to a PAGA settlement are not “parties” to a PAGA suit in the same sense that absent class members are “parties” to a class action. The fact that Peak may ultimately receive a portion of the PAGA settlement did not make him a party to the PAGA action. A PAGA action has “no individual component.” Finally, Peak’s filing of a separate PAGA action did not make him a party to this PAGA action.

This decision further separates PAGA actions from class actions, differentiating between class members in a class action, and allegedly aggrieved persons who may benefit from a PAGA action who are not deemed “parties.”

If you have questions about this decision or need assistance in defending a PAGA action, please contact the authors or another Jackson Lewis attorney.

In a recent decision, the California Court of Appeal held that a non-solicitation covenant was enforceable based on an exemption under California Business & Professions Code section 16601. The court stated, “contractual provisions that prevent a person from engaging in a profession, trade or business are generally void.” However, in the underlying case, the court affirmed a statutory exception to the prohibition against such contractual provisions, i.e., when an individual is selling the goodwill of a business and/or disposing of all their ownership interest in a business entity. In such situations, the individual may agree with the buyer to refrain from carrying on a similar business.

In the underlying case, Gregory S. Owen transferred his ownership interest in several real estate and construction-related firms he had founded to a new entity, Blue Mountain Enterprises, LLC (Blue Mountain). Owen became the company’s chief executive officer as part of the transfer.

As part of his employment contract, Owen agreed to abide by certain restrictive covenants, including a covenant barring him from soliciting Blue Mountain’s customers for three years following the termination of his employment. In April 2016, Owen was terminated from Blue Mountain for cause.

Months later, Owen established a new construction services company to compete with Blue Mountain. He sent a letter to several companies within the building and construction trades describing this new venture, including existing customers of Blue Mountain.

Blue Mountain successfully obtained preliminary and permanent injunctive relief prohibiting Owen from soliciting Blue Mountain’s customers and prevailed on its motion for summary adjudication of its breach of contract claim.

On a consolidated appeal, Owen challenged the trial court’s order granting summary adjudication in favor of Blue Mountain and contended that the non-solicitation covenant was unenforceable because it did not meet the requirements for a statutory exemption under California Business & Professions Code section 166601. The Court of Appeal disagreed with Owen and upheld the motion for summary adjudication.

If you have questions on non-solicitation agreements or related issues, contact a Jackson Lewis attorney to discuss.

 

On February 9, 2022, California Governor Gavin Newsom signed Senate Bill (SB) 114 which resurrects COVID-19 Supplemental Paid Sick Leave (SPSL) for 2022.

The following are answers that employers need to their questions regarding the latest edition of California SPSL.

When does SPSL become effective?

SPSL becomes effective February 19, 2022, 10 days after enactment. However, the statute applies retroactively to January 1, 2022.

How long will SPSL be in effect?

SPSL requirements will remain in effect until September 30, 2022.

Which employers are covered?

Employers with 26 employees or more must provide leave under the latest edition of SPSL.

Which employees are covered?

An employee of a covered employer who is unable to work or telework because of covered reasons. There is no length of service requirement.

What are the covered reasons for using SPSL?

The following are covered reasons for using SPSL:

  1. The covered employee is subject to a quarantine or isolation period related to COVID-19 as defined by an order or guidance of the State Department of Public Health, the federal Centers for Disease Control and Prevention (CDC), or a local public health officer who has jurisdiction over the workplace.
  2. The covered employee has been advised by a health care provider to isolate or quarantine due to COVID-19.
  3. The covered employee is attending an appointment for themselves or a family member to receive a vaccine or a vaccine booster for protection against COVID-19.
  4. The covered employee is experiencing symptoms or caring for a family member experiencing symptoms, related to a COVID-19 vaccine or vaccine booster that prevents the employee from being able to work or telework.
  5. The covered employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
  6. The covered employee is caring for a family member who is subject to an order or guidance or who has been advised to isolate or quarantine.
  7. The covered employee is caring for a child, whose school or place of care is closed or otherwise unavailable for reasons related to COVID-19 on the premises.

How many hours of SPSL are employees entitled to take?

A full-time covered employee is entitled to 40 hours of SPSL for the reasons detailed above. A part-time covered employee is entitled to a proportionate number of hours of SPSL based on the type of schedule the employee maintains for the reasons detailed above.

Both full and part-time employees are entitled to an additional amount of time, equal to their allotment for the reasons detailed above if the employee or family member for whom the employee is caring for tests positive for COVID-19 (e.g., full-time employees are entitled to an additional 40 hours). Employers are permitted to require documentation of the positive test to provide leave for this reason.

The maximum amount of SPSL a full-time employee can take during the period from January 1 to September 30, 2022, is 80 hours.  If an employee is eligible for exclusion pay under the Cal/OSHA Emergency Temporary Standard, SPSL hours cannot be used to offset any exclusion pay obligation.

Are there permitted limitations on the use of SPSL?

While SPSL allows for time off for vaccination, including receiving a booster, employers may limit the leave for symptoms for each vaccination or booster to 3 days or 24 hours unless the employee provides verification from a health care provider that the employee (or their family member) is continuing to experience adverse symptoms.

Are employers permitted to request documentation of an employee testing positive for COVID-19?

If an employee requests leave because they tested positive for COVID-19 or to care for a family member who tested positive for COVID-19, then the employer may request documentation of the positive test.

What type of notice do employers need to provide to employees regarding SPSL?

Employers must provide employees with written notice that sets forth the amount of SPSL the employee has used through the pay period in which it was due on either the employee’s itemized wage statement or in a separate writing provided on the designated pay date. The employer shall list zero hours used if a worker has not used any SPSL.

Employers are required to post a notice to be developed by the Labor Commissioner about this new SPSL benefit. If an employer’s covered employees do not frequent a workplace, the employer may satisfy this requirement by disseminating the notice through electronic means, such as e-mail.

What is the rate of pay that a non-exempt employee is compensated for SPSL?

Non-exempt employees shall be compensated based on one of the following:

  • Calculated in the same manner as the regular rate of pay for the workweek in which the employees uses SPSL.
  • Calculated by dividing the total wages, not including overtime premium pay, by the total hours worked, in the full pay periods of the prior 90 days worked.

What is the rate of pay that exempt employees are compensated for SPSL?

SPLS used by an exempt employee shall be paid in the same manner as other forms of paid leave time.

Is there a maximum amount the employer can be required to pay for SPSL?

Yes, an employer shall not be required to pay more than $511 per day and $5,110.00 in aggregate to a covered employee.

* * * *

If you have other questions regarding COVID-19 Supplemental Paid Sick Leave or need assistance with compliance, please do not hesitate to contact a Jackson Lewis attorney to discuss.

In January the California Department of Public Health (CDPH) extended universal masking indoors through February 15, 2022, due to a continued COVID-19 surge. In advance of the expiration, Governor Newsom announced that universal masking would not be extended again. The CDPH also published mask guidance for after February 15th.

Effective February 16, 2022, universal indoor masking will end. However, all individuals regardless of vaccination status will still be required to wear masks in the following indoor settings:

  • On public transit
  • Indoors in K-12 schools and childcare
  • Emergency shelters and cooling and heating centers
  • Healthcare settings
  • State and local correction facilities and detention centers
  • Homeless shelters
  • Long term care settings and adult and senior care facilities

In addition, unvaccinated individuals will be required to wear masks in indoor public settings and businesses. Vaccinated individuals are recommended, but will not be required, to wear masks indoors when the risk may be high.

The CDPH guidance states that for businesses where only unvaccinated individuals must wear masks, the business may choose to:

  • Provide information to all patrons, guests, and attendees regarding vaccination requirements and allow vaccinated individuals to self-attest that they are in compliance prior to entry.
  • Implement vaccine verification to determine whether individuals are required to wear a mask.
  • Require all patrons to wear masks.

Cal/OSHA’s Amended COVID-19 Emergency Temporary Standard (ETS) went into effect on January 14, 2022. Under the current ETS, unvaccinated individuals in the workplace must wear a mask. If an employer is not tracking vaccination status, then it must treat all employees as unvaccinated – meaning all employees would have to wear a mask. Employers should be mindful of other mask requirements under the ETS, including, but not limited to, screening, return to work, outbreak situations, and when required by the CDPH.

Finally, employers should check local health orders and ordinances regarding masking as some local public health departments have set plans to continue universal masking mandates despite the coming expiration of the state requirements.

Employers should continue to monitor local health departments, the California Department of Public Health, and Cal/OSHA for changes to COVID-19 workplace requirements. Employers can check Jackson Lewis’ COVID-19 Advisor for updates on workplace requirements in California and around the country.

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

The Private Attorneys General Act (PAGA) has been in the news lately with a proposed state Proposition seeking to reform it, and the Supreme Court taking up a case regarding PAGA and arbitrations. Though recent developments give hope to employers that some limitations will be placed on PAGA claims, the filing of PAGA claims continues to rise, with over 6,000 PAGA notices filed in 2021.

While PAGA claims are often compared to class actions, many of the rules and regulations governing class actions are not present such as the certification process. PAGA provides employees with a private right of action against an employer in order to collect civil penalties for California Labor Code violations on behalf of the state’s Labor and Workforce Development Agency (LWDA) and other aggrieved employees.

Notice and Cure Period

PAGA requires that claim notices, responses, and certain court documents be filed with the LWDA. Notice Letters are submitted pursuant to PAGA, which authorizes current and former employees to file state-wide, representative actions on behalf of themselves and similarly situated employees.

Some alleged violations can be cured.  Under PAGA, a defendant company has 33 days from the postmarked date of the notice to cure these alleged violations of the Labor Code. If these violations can be cured within the 33-day period, the claims can be barred.  If these violations are not cured, the Plaintiff-employee may initiate a lawsuit under PAGA. Because of this limited cure period, companies need to be alert to receipt of the notices and contact employment counsel quickly.

Otherwise, as to other alleged violations of the Labor Code, a Plaintiff may initiate a lawsuit under PAGA once 65 days have elapsed from the filing of the notice with the LWDA.

Things Employers Should Do to Protect Themselves

  1. Conduct Wage and Hour Audits: Employers may be hesitant to conduct audits for a variety of reasons. However, with the threat of collective actions like PAGA, employers must discover problems before a claim is brought.
  2. Review company policies and procedures: Ensuring the company has compliant policies can potentially reduce claims but also assist in the defense of the company if claims are brought.
  3. Ensure wage statements and time-keeping systems are compliant: As relatively small issues could potentially cost the company millions of dollars when multiplied across all “aggrieved employees.”

If you have questions about PAGA or have received a PAGA notice, reach out to Jackson Lewis’ California Class and PAGA Action team or the Jackson Lewis attorney with whom you regularly work.

Under federal law, there is the Worker Adjustment and Retraining Notification Act (WARN) which sets forth certain requirements for businesses who are closing locations and/or proceeding with large-scale reductions in force. As is typical for the state, California has separate WARN regulations often referred to as Cal-WARN.

Here are some of the important differences between the federal and California WARN Acts:

  Federal WARN Cal-WARN
Covered Employers

Applicable only to employers with 100 or more full-time employees* who must have been employed for at least 6 months of the 12 months preceding the date of required notice in order to be counted.

 

* Or 100 or more employees (including part-time employees) who in the aggregate work at least 4,000 hours per week (exclusive of overtime)

Any industrial or commercial facility or part thereof that employs, or has employed within the preceding 12 months, 75 or more persons.

 
Plant Closing (Termination), Layoff, or Relocation Requiring Notice

Plant closings involving 50 or more employees (excluding part-time employees) during a 30-day period. Layoffs within a 30-day period involving 50 to 499 full-time employees constituting at least 33% of the full-time workforce at a single site of employment. Layoffs of 500 or more full-time employees are covered regardless of the percentage of the workforce.

Does not cover employees who may otherwise be affected by relocations or consolidations of parts or all of the business if there is no more than a six-month break in employment and the employer offers a transfer to the employee within a reasonable commuting distance, or the employee accepts the transfer regardless of distance within 30 days of the offer or the closing or layoff, whichever is later.

 Plant closure affecting any number of employees. Layoff of 50 or more employees within a 30-day period regardless of % of the workforce. Relocation of at least 100 miles affecting any number of employees.
Notice Requirement An employer must provide written notice 60-days prior to a plant closing or mass layoff to employees or their representative, the State dislocated worker unit (the Employment Development Department, Workforce Services Division in California), and the chief elected official of local government within which such closing or layoff is to occur. An employer must give notice 60-days prior to a plant closing, layoff, or relocation. In addition to the notifications required under federal WARN, notice must also be given to the Local Workforce Development Board, and the chief elected official of each city and county government within which the termination, relocation, or mass layoff occurs.

 

California’s Employment Development Department (EDD) also has an FAQ page that may be useful for employers.

If you need assistance with a mass layoff and related issues, contact a Jackson Lewis attorney to discuss.

January 31st was the last day for the California legislature to approve bills that had been initially introduced in 2021 before they are shelved for good. The FAST Recovery Act (Assembly Bill (AB 257) was such a bill.

AB 257 would create an 11 member Fast Food Sector Council appointed by the Governor and state legislators to review and create workplace standards for fast food employees – including standards on wages, working conditions, and training – and to issue, amend, and repeal rules and regulations pertaining to fast food employment as appropriate.  The Council would be required to hold public hearings every six months and to conduct a full review of the adequacy of minimum fast-food restaurant health, safety, and employment standards at least once every three years.  The bill would also permit a county, or a city with a population greater than 200,000, to establish a Local Fast Food Sector Council authorized to provide recommendations to the state Council and would prescribe requirements for the state Council in connection with these recommendations.

In addition, AB 257 would have significant implications for franchisers as it would require that fast food restaurant franchisers be responsible for ensuring that their franchisees comply with a variety of employment, worker, and public health and safety laws and orders, including those related to unfair business practices, employment discrimination, the California Retail Food Code, labor regulations, emergency orders, and standards issued by the Council.  If passed, the bill would make a franchiser jointly and severally liable for violations of its franchisees and would provide that specified laws may be enforced against a franchiser to the same extent that they may be enforced against a franchisee.  Further, AB 257 would make any agreement by a franchisee to indemnify its franchiser for liability void and unenforceable as contrary to public policy and would allow franchisees to file an action against their franchisers for monetary or injunctive relief in connection with the franchisee’s compliance with specific laws.

Last year, the author of AB 257 sent the bill to the inactive file, but it was pulled out this year, amended, and passed by the California State Assembly on January 31st. The bill now has to pass California’s Senate and be signed by the Governor to become law.

Jackson Lewis tracks legislation relevant to employers in California and across the nation. If you have questions about the FAST Recovery Act or related issues, contact a Jackson Lewis attorney to discuss.