I hope you were able to listen to the discussion this morning on KQED regarding the Domestic Workers Bill of Rights. Unfortunately I was not able to address an area of the law that gives me the greatest concern: This bill would unduly broaden the definition of employer, unnecessarily increase who will be considered an employee, and create additional burdens on homeowners and occupants with respect to non-caregiver workers. I apologize in advance for the length of this post (I usually try to keep them brief), but there is some background that I think is necessary.
Putting aside the issue of whether personal attendants/caregivers should or should not be entitled to overtime, AB889 broadens the definition of an employer. Under most wage orders, an employer is anyone who exercises control over the wages, hours or working conditions of the employee. (See Martinez v. Combs.) Court decisions have agreed that corporate officers and directors are not considered employers. AB889, however, includes corporate officers or executives who directly or indirectly through third parties exercise control over wages, hours or working conditions of employers. In essence, the bill eradicates the typical corporate shield that is a significant benefit of the corporate structure.
Let’s consider how this broad definition could impact the typical independent contractor relationship most homeowners have with non-caregivers. I’m talking about the gardener, the roofer, the pool cleaner, etc.. If you, as the homeowner, control the working conditions, then you are the employer. If you decide on the wages you will pay or what hours the person will come into your home, then you are the employer. You will not be able to hire a sole proprietor with no employees because otherwise you are arguably controlling the wages, hours and working conditions of the employee. If you hire a company with employees, then hopefully the company will control the hours and wages, but I’m not so sure about the working conditions.
Additionally, AB889 modifies the workers’ compensation laws to apply to any person who performs any work at or on your home regardless of how long they work at the home. Labor Code Section 3351 defines who is an employee for workers’ compensation purposes. Workers’ Compensation laws not only require workers’ compensation insurance coverage for all employees, but also requires employers to provide notice of certain rights under the Workers’ Compensation laws. Currently, Labor Code Section 3352(h) excludes person employed by the homeowner for less than 52 hours in the 90 calendar days preceding the date of injury from the definition of employee. AB889 deletes the 3352(h) exemption. What that means is that you, as a homeowner, will need to carry workers’ compensation insurance for any person providing services to your home, such as gardeners, construction workers, pest control servicemen, cable installers, etc. You will have to have workers’ compensation insurance for them even if they only come to your house one day for a couple of hours and even if they are covered by their own workers’ compensation insurance. You will also have to provide them notification of their workers’ compensation rights.
AB889 deletes a similar provision in Labor Code Section 226. Labor Code Section 226 requires employers to provide itemized pay stubs to all employees. The pay stubs must have specific information such as hours worked, wage rates, last four digits of the employee’s social security number, etc. Currently, there is an exemption to that rule for employees employed by the owner or occupant of a residential dwelling whose duties are incidental to the ownership, maintenance or use of the dwelling. AB889 takes away that exemption. Like the Workers’ Compensation laws discussed above, that means you will have to provide a pay stub to your gardener, cable installer, home improvement contractor, etc.
Regardless of which side of the aisle you are on regarding overtime entitlements for caregivers, the other changes proposed by AB889 create a significant burden on everyone, overly broadens the definition of employer, and imposes unwieldy requirements in situations that do not need reform. I encourage you to read the bill. Talk about the issue with your friends, families and co-workers, and come to your own conclusions regarding whether this bill is the appropriate way to resolve the problems. Then, write your representative and let them know your thoughts. That’s what I’m going to do.The Law Office of Phillip J. Griego 95 South Market Street, Suite 520 San Jose, CA 95113 Tel. 408-293-6341 Original article by Robert E. Nuddleman, former associate of The Law Office of Phillip J. Griego. Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney. Your use of this blog does not create an attorney-client relationship between you and the Law Office of Phillip J. Griego. The use of the Internet or this blog for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be posted in this blog and the Law Office of Phillip J. Griego cannot guarantee the confidentiality of anything posted to this blog.Phillip J. Griego represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.
Most employers have some sort of vacation policy. Under California law, if an employee has unused accrued vacation at the end of his/her employment, the employer must pay out the unused but accrued vacation. Several companies also offer a sabbatical program, which typically offers a longer period of paid time off after a particular length of employment. While traditionally sabbaticals were designed to allow professors and the like to gain new experiences and knowledge that would enhance the reputation of the colleges offering the sabbaticals, as private non-educational employers began offering sabbatical programs employees were allowed to take sabbaticals merely to “recharge their batteries.” Unlike vacation plans, an employer can have a “use it or lose it” sabbatical policy.
So, what’s the difference between a sabbatical and vacation, and can employers simply call their vacation plan a sabbatical in order to avoid the end-of-employment payment required by vacation plans? That’s what Paton v. Advanced Micro Devices, Inc. had to decide.
After going through a short history of the sabbaticals, as well as several DLSE opinion letters on the issue, the court announced a four-part test to determine whether a sabbatical really is a sabbatical:
- The sabbatical leave should be granted infrequently and intended to retain experienced employees who have devoted a significant period of service to the employer. The court suggested a 7-year rule, allowing employees to take sabbatical every 7 years, but acknowledged that greater or shorter periods might be appropriate depending on industry standards.
- The length of sabbatical should be longer than that “normally” offered as vacation. Since regular vacation time may be used for rest, a sabbatical ought to provide the extended time off work that regular vacation does not. The court did not indicate what length of time would suffice, but in Paton the employee was entitled to a four-month sabbatical and the court believed there was sufficient question as to the validity of the sabbatical policy for a jury to decide the issue.
- The sabbatical must be in addition to regular vacation. According to the court, [b]ecause an employer could offer a minimal vacation plan and reward senior staff with sabbaticals as a way to avoid the financial liability of a more generous vacation plan, the employer’s regular vacation policy should be comparable to the average vacation benefit offered in the relevant market.”
- The sabbatical program should incorporate some feature that demonstrates that the employee taking the sabbatical is expected to return to work for the employer after the leave is over. This was an element implied by the Labor Commissioner, but not explicitly enunciated as a requirement for a valid sabbatical program.
The court rejected the idea that the sabbatical must be for specified purposes (i.e., continued education, career development, etc.) and be limited to upper management (an element previously identified by the Labor Commissioner as necessary for a true sabbatical.
Another interesting tidbit, while many recent decisions refuse to follow Labor Commissioner opinion letters, the Paton court acknowledged that the court is not required to reject those opinions. Unfortunately, employers and employees won’t know which opinions are correct and which are not good law until the courts review each opinion letter.
If your company uses sabbaticals as a way to reward long-term employees, speak with an employment attorney to ensure the company policies follow the law.The Law Office of Phillip J. Griego 95 South Market Street, Suite 520 San Jose, CA 95113 Tel. 408-293-6341 Original article by Robert E. Nuddleman, former associate of The Law Office of Phillip J. Griego. Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney. Your use of this blog does not create an attorney-client relationship between you and the Law Office of Phillip J. Griego. The use of the Internet or this blog for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be posted in this blog and the Law Office of Phillip J. Griego cannot guarantee the confidentiality of anything posted to this blog.Phillip J. Griego represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.
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