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New 2015 Employment Laws

2015 Employment Law Update For California Businesses

Once again the California legislature and courts have been extremely busy trying to provide additional protections for employees. This year, we’ve also seen a number of citywide ordinances that will impact the wages and benefits companies provide their employees. Employers need to be aware of the changes, so they can modify their policies to comply with state, federal and local laws.

The following is a quick summary of the most significant changes in the law impacting California businesses.

Paid Sick Leave for All California Employees

Effective July 15, 2015, AB 1522 requires employers doing business in California to provide paid sick days to almost all employees. Employees will accrue 1 hours of paid sick leave for every 30 hours worked, regardless of whether the employee is full-time or part-time. Unlike many city ordinances, California’s paid sick leave begins accruing as soon as the employee starts to work (or July 15, 2015, whichever is later), although an employer can prohibit an employee from using accrued paid sick leave in the first 90 days of employment. Employers may also “limit an employee’s use of paid sick days to 24 hours or three days in each year of employment.” Unused paid sick days carry over to the following year, but employers can place a 6-day cap on the paid sick day accrual. Be aware that some cities have ordinances that allow a higher cap, and employers have to comply with whichever laws are most favorable to employees. Employers must also provide written notice of the accrued and used sick leave, either on the pay stub or in a separate document, with every paycheck.

City Paid Sick Leave Ordinances

San Francisco, Oakland and San Diego passed city-wide ordinances requiring paid sick leave for certain employees. The city ordinances are similar to California’s new paid sick leave law, but sometimes provide additional benefits for employees working within city limits. If you have employees working in any city that has adopted a paid sick leave ordinance, you should review your current paid sick leave policies to ensure compliance. We expect other cities to follow suit.

Federal Regulations Regarding Companions Goes Into Effect

Although the Department of Labor has said it will not enforce the new regulations until mid-year, companions will be entitled to overtime when they work more than 40 hours in a week unless otherwise exempt from the Fair Labor Standards Act. While some personal attendants may still be exempt if the household owner employs the companion directly and the duties are limited to providing companionship and protection, caregivers employed by third-party employers and caregivers that provide care in addition to companionship and protection are now covered by the FLSA. Although personal attendants in California have been entitled to overtime after 9 hours in a day or 45 hours in a week, Californians using caregivers may need to pay weekly overtime after 40 hours in a week beginning January 1st.

Unpaid Interns Are Protected from Unlawful Harassment

The Fair Employment and Housing Act was amended to extend protection to unpaid interns. This is a good time to remind employers that the Labor Commissioner and the Department of Labor only allow unpaid interns in a few situations, typically when the intern is receiving school credit and the employer receives very little benefit from the work. If you use interns, now is a good time to examine whether the interns are actually entitled to wages.

Anti-Bullying Module for Sexual Harassment Prevention Training

All employers with 50 or more employees are required to provide 2 hours of sexual harassment prevention training to all supervisory employees every 2 years. Although “bullying” is not strictly prohibited by law, AB 2053 now requires the sexual harassment prevention training to include a module on anti-bullying. When booking your sexual harassment prevention training, ask your provider whether they include an anti-bullying module. We recommend sexual harassment prevention training for most employers, even if you have less than 50 employees, to ensure employees know how to seek assistance.

No Discrimination Against Workers with Special Drivers Licenses

The DMV must issue an original driver’s license even if the person cannot submit satisfactory proof that the applicant’s presence in the United States is authorized under federal law if he or she meets all other qualifications for licensure and provides satisfactory proof to the department of his or her identity and California residency. AB 1660 prohibits discrimination against an individual because he or she holds or presents a driver’s license issued under these provisions or to require a person to present a driver’s license, except in specific situations. Additionally, FEHA’s definition of “national origin” now includes discrimination on the basis of possessing a driver’s license granted under Section 12801.9 of the Vehicle Code. The new laws do not alter an employer’s rights or obligations under Section 1324a of Title 8 of the United States Code regarding obtaining documentation evidencing identity and authorization for employment. Any action taken by an employer that is required by the federal Immigration and Nationality Act (8 U.S.C. Sec. 1324a) is not a violation of law. Driver’s license information obtained by an employer must be treated as private and confidential, is exempt from disclosure under the California Public Records Act, and can not be disclosed to any unauthorized person or used for any purpose other than to establish identity and authorization to drive.

Employers Using Third-Party Employers Are Liable for Wages and Workers’ Compensation Insurance

Labor Code section 2810.3 requires a “client employer” to share with a “labor contractor” all civil legal responsibility and civil liability for all workers supplied by that labor contractor for the payment of wages and the failure to obtain valid workers’ compensation coverage. In other words, if your company receives workers through a contracting agency, and that agency fails to pay the worker or fails to maintain valid workers’ compensation coverage, your company could be responsible for any unpaid wages or workers’ compensation claims. Employers can still include indemnification language in their contracts, but they cannot avoid liability by hiring the worker through a third-party employer.

Longer Statute of Limitations for Liquidated Damages and Failure to Timely Pay Final Wages

Existing law provides for criminal and civil penalties for certain wage violations and authorizes the Labor Commissioner to recover liquidated damages for minimum wage violations. AB 1723 expands Labor Code section 1197.1 to allow the Labor Commissioner to issue citations and seek penalties for the willful failure to timely pay wages of a resigned or discharged employee.

Several Cases Cause Employers to Reconsider Mandatory Arbitration Provisions

For years employers had difficulty requiring employees to agree to resolve all dispute through arbitration. Recent U.S. Supreme Court and California court decisions make it easier for employers to require binding arbitration for some employment law claims. Employers should evaluate whether binding arbitration is the right decision for their business. There are many pros and cons to resolving cases through binding arbitration, and employers must still be careful when drafting arbitration agreements. Just because you find an arbitration agreement on line does not mean it will be enforceable.

Minimum Wage Increase By Various Cities

Dissatisfied with California’s minimum wage (currently $9.00 per hour), several cities passed their own ordinances requiring a higher minimum wage for employees working within certain geographical limits. The following cities will have the following minimum wage requirements this year:

New Minimum Wage Laws

We expect to see more cities adopt similar legislation, and California legislators are trying to pass a higher California minimum wage by the end of the year (currently slated to increase to $10.00 per hour on January 1, 2016).

Employers need to update their employment handbooks and their policies to comply with the new laws. There is no better time to review your policies and practices with a knowledgeable employment attorney. The New Year affords employers the opportunity to start the year in compliance, and avoid potentially costly mistakes.

If you have any questions about the new laws, or any employment-related matter, contact our office and speak with one of our attorneys. Let us help you figure out how to employ your workers correctly, so you can focus on growing your business.

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