Contributors

Christian Scali

Founder and Managing Shareholder

In California, another year means another set of new employment laws that impose burdens on employers. The 2021 legislative session was no exception, with new laws passed and signed that address employment-related confidentiality agreements, wage theft, and family medical leave, to name a few areas. The good news for California employers is that none of the new laws make revolutionary changes to employee rights or employer responsibilities, but employers nonetheless need to understand these changes and adjust their policies to avoid potential liability in the future.

SB 331 - Nondisparagement Agreements

What the law currently requires

The STAND (Stand Together Against Non-Disclosure) Act, which California passed in 2018 in response to the #MeToo movement, barred settlement and nondisparagement agreements from preventing employees from speaking about sexual harassment, discrimination, or retaliation.

How this bill changes the law

This bill will nullify and make void provisions within any agreement entered on or after January 1, 2022 that prevent or restrict an employee from disclosing factual information on any type of harassment, discrimination, or retaliation.

It will also prohibit non-disparagement agreements or similar agreements required as a condition of employment or continued employment or as part of a severance agreement that deny an employee’s right to disclose information about unlawful acts in the workplace, unless the agreement includes a specific carve-out providing for the employee’s right to discuss workplace conduct the employee has “reason to believe” is unlawful.

Employers may continue to ask or require confidentiality and non-disparagement agreements, but will need to be much more careful in drafting them to avoid nullification.

AB 1033 – CFRA Leave and Small-Employer Arbitration

What the law currently requires

The California Family Rights Act (CFRA) guarantees protected unpaid leave for employees who must take time away from work to care for family members in specific circumstances.

In addition, in 2020, AB 1867 established a program for a more practical, streamlined procedure for implementing a small employer family leave mediation program. All family leave claims brought against small employers with five to 19 employees could be sent to mediation, instead of directly to court.

How this bill changes the law

This bill adds parents-in-law to the list of family members that employees may take time away from work to care for in covered circumstances.

The bill also fixes issues relating to the implementation of the small employer mediation program by:

• Improving how mediation is initiated under the program and ensuring mediation occurs within a timely manner;
• Requiring the DFEH to inform employees of this requirement, including instructions on how to initiate mediation on all right-to-sue notices; and
• Clarifying that a small employer may stay a civil lawsuit or arbitration proceeding to pursue mediation if the complaint should have been subject to the mediation pilot program.

SB 606 – Cal/OSHA Power Expansion

What the law currently requires

Existing law gives Cal/OSHA the power, jurisdiction, and supervision over every employee and place of employment in this state, which is necessary to adequately enforce and administer all laws requiring that employment and places of employment be safe, and requiring the protection of the life, safety, and health of every employee in that employment or place of employment.

How this bill changes the law

This bill will create a rebuttable presumption that a violation committed by an employer that has multiple worksites is enterprise-wide if the employer has a written policy or procedure that violates these provisions, except as specified, or the division has evidence of a pattern or practice of the same violation committed by that employer involving more than one of the employer’s worksites. The bill will authorize the division to issue an enterprise-wide citation requiring enterprise-wide abatement if the employer fails to rebut such a presumption. The bill will impose specified requirements for a stay of abatement pending appeal of an enterprise-wide citation. The bill will subject an enterprise-wide violation to the same penalty provision as willful or repeated violations.

This bill will also require Cal/OSHA to issue a citation for an egregious violation, as defined, for each willful and egregious violation determined by the division. The bill, except as specified, will require each instance of an employee exposed to that violation to be considered a separate violation for purposes of the issuance of fines and penalties. An egregious violation is defined as:

1. Intentional violation, through conscious, voluntary action or inaction and no reasonable effort to eliminate the known violation.
2. The violation resulted in worker fatalities, a worksite catastrophe, or a large number of injuries or illnesses.
3. The violation resulted in persistently high rates of worker injuries or illnesses.
4. The employer has an extensive history of prior violations of this part.
5. The employer has intentionally disregarded their health and safety responsibilities.
6. The employer’s conduct, taken as a whole, amounts to clear bad faith in the performance of their duties under this part.
7. The employer has committed a large number of violations so as to undermine significantly the effectiveness of any safety and health program that may be in place.

Finally, the bill will authorize Cal/OSHA to issue a subpoena if the employer or the related employer entity fails to promptly provide the requested information, and to enforce the subpoena if the employer or the related employer entity fails to provide the requested information within a reasonable period of time. The bill will authorize the division to seek an injunction restraining certain uses or operations of employment if it has grounds to issue a citation, as specified. The bill will expand grounds for granting a temporary restraining order to include grounds to issue a citation, as prescribed.

AB 1003 – Wage Theft as Grand Theft

What the law currently requires

The California Labor Code provides criminal penalties for intentionally depriving employees of their earned wages. Section 215 provides that any person who violates certain Labor Code sections requiring wage payments to employees is guilty of a misdemeanor.

How this bill changes the law

This law adds Section 487m to the Penal Code, making it the crime of grand theft to engage in intentional theft of wages, including gratuities, “in an amount greater than nine hundred fifty dollars ($950) from any one employee, or two thousand three hundred fifty dollars ($2,350) in the aggregate.” Grand theft is generally punishable either as a misdemeanor by imprisonment in a county jail for up to one year or as a felony by imprisonment in county jail for 16 months or two or three years.

SB 646 – Janitorial Employees

What the law currently requires

The Labor Code Private Attorneys General Act of 2004, authorizes an aggrieved employee to bring a civil action to recover specified civil penalties that would otherwise be assessed and collected by the Labor and Workforce Development Agency on behalf of the employee and other current or former employees for the violation of certain provisions affecting employees. Existing law requires a person or entity that employs one or more janitors or otherwise engages by contract, subcontract, or franchise agreement for the provision of janitorial services, as specified, to register with the Labor Commissioner as a property service employer annually and prohibits them from conducting business without a registration.

How this bill changes the law

This bill will except from PAGA a janitorial employee represented by a labor organization that has represented janitors before January 1, 2021, and employed by a janitorial contractor who registered with the commissioner as a property service employer in calendar year 2020, with respect to work performed under a valid collective bargaining agreement in effect any time before July 1, 2028, that contains certain provisions, including, among others, a grievance and binding arbitration procedure to redress violations that authorizes the arbitrator to award otherwise available remedies. The bill will require a janitorial contractor who has entered into an agreement as prescribed to share, within 60 days of entering the agreement, specified information about the agreement with the Labor and Workforce Development Agency. The bill will specify that its provisions do not apply to existing cases filed before the effective date of the bill and does not prevent a janitorial employee from filing certain actions. The bill will authorize the exception until the collective bargaining agreement expires or until July 1, 2028, whichever is earlier, and would repeal the bill’s provisions on July 1, 2028.

SB 657 – Electronic Notices to Employees

What the law currently requires

Existing law requires businesses to post specific information about employee wages, hours, and working conditions in a physical location in the workplace.

How this bill changes the law

This bill allows employers to send information they are required to physically post to employees by email with the information attached.

SB 62 – Garment Manufacturing

What the law currently requires

Existing law makes garment manufacturers liable for guaranteeing payment of wages to the employees of their contractors, even when those garment manufacturers do not employ the employees of their contractors.

Existing law also requires every employer engaged in the business of garment manufacturing to keep certain records for 3 years, including, among other things, contract worksheets indicating the price per unit agreed to between the contractor and manufacturer.

Existing law precludes any employer, or other person or entity, who may be liable for a violation of any provision of the Labor Code from introducing as evidence, in an administrative proceeding contesting a citation or writ proceeding under specified provisions, books, documents, or records that are not provided pursuant to a duly served written request by the Labor Commissioner within the time the Labor Commissioner requests those books, documents, or records be produced.

How this bill changes the law

This bill expands the definition of garment manufacturing to include dyeing, altering a garment’s design, and affixing a label to a garment. The bill will prohibit any employee engaged in the performance of garment manufacturing to be paid by the piece or unit, or by the piece rate, except as specified. The bill will impose compensatory damages of $200 per employee against a garment manufacturer or contractor, payable to the employee, for each pay period in which each employee is paid by the piece rate.

This bill will define “brand guarantor” for purposes of these provisions as a person contracting for the performance of garment manufacturing, , regardless of whether the person with whom they contract performs manufacturing operations or hires a contractor or subcontractor to perform manufacturing operations. This bill will specify that a garment manufacturer, contractor, or brand guarantor who contracts with another person for the performance of garment manufacturing operations shares joint and several liability with any manufacturer and contractor for the full amount of unpaid wages, and any other compensation, including interest, due to any and all employees who performed manufacturing operations for any violation, attorney’s fees, and civil penalties, as specified. The bill will also make garment manufacturers and contractors liable for the full amount of damages and penalties for any violation, as specified.

This bill will create a rebuttable presumption in a claim filed with the Labor Commissioner to recover unpaid wages and associated penalties, if an employee has provided the Labor Commissioner with labels or other information that the commissioner finds credible relating to the identity of any brand guarantor or garment manufacturer that the brand guarantor or garment manufacturer is liable with the contractor for any amounts found to be due to the employee. The bill will also give the Labor Commissioner authority to enforce these provisions by issuing a stop order or a citation.

This bill will also require every employer engaged in the business of garment manufacturing and brand guarantors to keep all contracts, invoices, purchase orders, work orders, style or cut sheets, and any other documentation pursuant to which garment manufacturing work was, or is being, performed for 4 years.

Finally, this bill will expand the provisions excluding evidence not produced to the Labor Commission, records relating to the payment of wages for the performance of garment manufacturing.

COVID-19 Laws and Regulations

NOTE: As of our publication date, the federal mandate is on hold due to litigation. Cal/OSHA has therefore not yet adopted a vaccination mandate. For now, California employers should prepare to implement this mandate, but the start date for the mandate will likely be after January 4.

Businesses across the country that have 100 or more employees will need to require COVID-19 vaccinations for all employees or regularly test unvaccinated employees for the disease by January 4, 2022. On September 9, 2021, President Biden announced that he was directing the Department of Labor’s Occupational Safety and Health Administration to adopt Emergency Temporary Standards (ETS) on vaccination and testing, but did not announce a compliance deadline at that time. Now, business can get through the holidays without implementing the mandate, but will need to have it in place at the start of the New Year.

Who does this apply to?

If your business employs 100 or more people, it must comply with this mandate by January 4, 2022. This definition of employ counts each full and part time employee as a single employee, regardless of hours worked. It also counts all of the employees of affiliates, so if the combined employees of multiple affiliates is 100 or more, the parent company and its affiliates must comply. However, the ETS does not apply to employees who exclusively work from home, outdoors, or at a workplace that has no other employees or customers, though those employees still count towards the employee total.

What does the mandate require?

With limited exceptions, covered businesses must require that employees be fully vaccinated for COVID or regularly test for COVID starting January 4. To determine whether an employee is fully vaccinated, employers must obtain “acceptable proof” of vaccination status, which includes the following:

• A record of immunization from a health care provider or pharmacy
• A copy of the COVID-19 Vaccination Record Card
• A copy of medical records documenting the vaccination
• A copy of immunization records from a public health, state, or tribal immunization system
• A copy of any other official documentation that shows the type of vaccine administered, dates of administration, and name of the health care professional or provider that administered the vaccines
• When an employee is unable to provide the above, a signed and dated statement by the employee attesting to vaccination status, that they are unable to provide documentation, and a specific statement of accuracy specified in the text of the ETS

Employers must treat an employee who does not provide acceptable proof as not fully vaccinated. Employers must maintain records of each employee’s vaccination status and copies of the “acceptable proof.” This is a big departure from California law, which has to date only required attestation to vaccination status. However, if prior to this ETS an employer documented an employee’s fully vaccinated status through attestation or other proof, the employer need not go back and request “acceptable proof” from the employee.

Employers must also provide support for employees seeking vaccination. This includes providing employees with up to 4 hours paid time off at the employee’s regular rate of pay to travel to and obtain a vaccine. It also includes reasonable time and paid sick leave to recover from side effects of vaccination. OSHA has stated that two days is presumably reasonable to overcome the vast majority of vaccination symptoms.

Employees who are not fully vaccinated and who report to a workplace where coworkers or customers are present must test for COVID at least once every 7 days and provide documentation of test results no later than the 7th day following the last provided test result. If an employee teleworks or reports to a workplace less frequently than once every 7 days, the employee must test within 7 days prior to reporting to the workplace and provide documentation of the test result upon return.

Employees may submit COVID test results from any test approved by the FDA, whether viral or antigen. If a test is both self-administered and self-tested (i.e. the employee both collects and tests the sample), the results meet these requirements if the employer or a health proctor watched the test. If a test is self-administered then the sample sent to a lab for testing, then the self-administration need not be observed by any party.

The ETS states that it does not require employers to pay for these COVID tests, but notes that other laws may require employers to do so. For California employers, that almost certainly means that they will need to pay for COVID tests, as California law requires employers to pay for goods and services they require employees to use in most cases.

Finally, the ETS follows the Cal/OSHA requirement that all unvaccinated employees must wear a face covering while indoors or inside a car with another person for work purposes. The only exceptions are when an employee is alone in a room with floor to ceiling walls and a closed door or when the employee is eating or drinking.

What should I do next?

The mandate is currently stayed pending litigation, which means that the mandate is unlikely to go into effect on January 4, 2022. Nonetheless, now is the time for employers to develop their compliance plans. Businesses should prepare.

SB 336 – Health Notices

What the law currently requires

Current law gives local governments and health departments broad authority to take actions to protect public health.

How this bill changes the law

This bill will require publication of local public health orders and create an email list for stakeholders to ensure they are kept apprised of any changes.

AB 110 – Fraudulent Claims Prevention

This bill will require the Department of Corrections and Rehabilitation to provide the name, known aliases, birth date, social security number, and booking date and expected release date, if known, of a current inmate to the Employment Development Department for the purposes of preventing payments on fraudulent claims for unemployment compensation benefits. The bill will require this information to be provided to the Employment Development Department on the first of every month and upon the Employment Development Department’s request.

 

SB 390 – EDD Recession Plan

This bill will require the department to develop and, upon appropriation by the Legislature, implement a recession plan to prepare for an increase in unemployment insurance compensation benefits claims due to an economic recession. The plan must detail how to respond to economic downturns with a predetermined strategy that has considered the full effect on the department’s operations, and include, but not be limited to, identifying the lessons learned from previous economic downturns, identifying ways to improve self-serve services to avoid long wait times to speak to staff, and enhancing claims processing tools to ensure that the department’s identity verification processes are as robust as possible.