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News & Analysis
Latest legal news and recent law changes.

California Updates Several Employment Laws: Effective January 1, 2022

1. The Definition of “Family” Officially Changed to Include Your In-Laws.

One of the more interesting changes comes from AB 1033 (available here). A straightforward law, the California Family Rights Act is amended so that “family” includes an employee’s parents-in-law.

Current law makes it unlawful for an employer to refuse to grant a request by an employee to take up to 12 workweeks of unpaid protected leave during any 12-month period for family care and medical leave.

Existing law defines family care and medical leave to include, among other things, leave to care for a parent. This is now expanded to include your parents-in-law.

2. Arbitration Invoices Shall be Due the Same Day They Are Issued

SB 760 (available here) amends the current law to remove the thirty (30) day leeway given to employers (or technically whomever the drafting party is) to pay initial arbitration fees so arbitration can begin. The new law requires the arbitration provider to provide invoices for the fees, in their entirety, to all parties to the arbitration on the same day and by the same means.

In other words, employers who have mandatory arbitration clauses in their contract must pay their arbitration invoices immediately upon receipt or they waive their right to enforce arbitration.

Notably, the law allows for the arbitration agreement to expressly provide for “a different time for payment”; thus this provision can be easily contracted around.

3, Theft of Wages, Gratuity, or Other Compensation is Escalated from a Civil Misdemeanor to Grand Theft.

AB 1003 (available here) escalates the “intentional theft” of an employee’s “wages, gratuities, benefits, or other compensation” equal to $950 or over for an individual, or $2,350 or above for two or more employees, to a grand theft crime. The employer’s actions need not occur all at once and can cumulatively occur through any 12-month period.

In other words, employers who “knowingly” miss a paycheck, take a cut of their employee’s tips, or refuse to properly provide any benefits required by law or any further compensation due to their employees, risk “imprisonment in a county jail for up to 1 year or as a felony by imprisonment in county jail for 16 months or 2 or 3 years.”

Now is a good time to make sure your Human Resources and Payroll departments are in good shape.

4. California Cracks Down on Emotional Support Animals.

AB 468 (available here) cracks down on the liberal allowance for emotional support animals and has two main parts.

First, it restricts health care practitioners from providing documentation relating for an emotional support animal unless the health care practitioner:

    1. Holds a valid license;
    2. Established a client-provider relationship with the individual for at least 30 days prior to providing the documentation;
    3. Completes a formal clinical evaluation of the individual regarding the need for an emotional support animal; and
    4. Provides verbal or written notice to the individual that knowingly and fraudulently representing themselves as the owner or trainer of a guide, signal or service dog (which is not the same thing as an emotional support animal) is a misdemeanor.

Second, it requires businesses that sell dogs to provide a written notice to the buyer or recipient of the dog stating that the dog does not have the special training required to qualify as a guide, signal, or service dog and is not entitled to the rights and privileges accorded by law to a guide, signal, or service dog.

5. Employment Posting Law Joins the 21st Century

SB 657 (available here) is a curious law, in that it provide legal permission for something every employer already does, and doesn’t actually do anything to make things better.

California law requires the posting of a variety of notices (wages, workers’ comp, etc.) in the workplace. The changes provide that in any instance in which an employer is required to physically post information, that employer may also distribute that information to employees by email with the document or documents attached.

Notably, the bill specifies that the employer must still physically display the required posting; it just allows them to email it as well. It is unclear why this needed to be codified in law, except perhaps to clarify that email was supplemental and not an alternative, and also to help remote workers; however, again, electronic posting is only allowed, and not required.

6. Nondisclosure Agreements and Other Related Non-Disparagement Agreements Cannot Cover Any Harassment or Discrimination.

SB 331 (available here) expands the topics protected by employee free speech, in that it expands the scope of matters which employers are prohibited from forcing an employee to refuse to divulge through a non-disparagement agreement. A non-disparagement agreement is when an individual has agreed that they won’t say anything negative about a company or its products, services, or leaders and generally covers all forms of communication. Employees will customarily sign such agreements as a condition for employment or as part of a settlement after a failed employment.

Previously, the law only protected sexual discrimination, meaning that you could never force an employee to refrain from divulging a previous circumstance of sexual misconduct or bias in the workplace; however, the law has been vastly expanded to include all forms of harassment, discrimination and/or retaliation. Furthermore, all employees must be made aware of this requirement for any non-disparagement contract to include the “magic words”:

Nothing in this agreement prevents you from discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination or any other conduct that you have reason to believe is unlawful.

In other words, employers cannot prevent an employee from disclosing any harassment, discrimination and/or retaliation they reasonably believe occurred in the workplace. Furthermore, employers must make their employees aware of this for any nondisclosure agreement to be valid.

7. Cal OSHA Expands Their Ability to Issue Workplace Health and Safety Violations

The Division of Occupational Safety and Health (Cal OSHA) retains the power, jurisdiction, and supervision over every employment and place of employment in California. SB 606 (available here) makes it so that employers who have specific violations within two or more locations are considered to have that violation “enterprise-wide” and Cal OSHA can cite them as such (meaning their entire operation, not just where they found the violations). This enterprise-wide presumption is rebuttable, so employers can bring evidence that the violations are narrowly limited to specific sites.

The law also allows Cal OSHA to cite employers for “egregious” violations, for repeated, negligent, or intentional violations which show clear bad faith by the employer. Only one of the following needs to be proven true for a violation to now be considered “egregious”:

    1. The employer, intentionally, through conscious, voluntary action or inaction, made no reasonable effort to eliminate the known violation;
    2. The violations resulted in worker fatalities, a worksite catastrophe, or a large number of injuries or illnesses. For purposes of this paragraph, “catastrophe” means the inpatient hospitalization, regardless of duration, of three or more employees resulting from an injury, illness, or exposure caused by a workplace hazard or condition;
  • The violations resulted in persistently high rates of worker injuries or illnesses;
    1. The employer has an extensive history of prior violations of this part;
    2. The employer has intentionally disregarded their health and safety responsibilities;
    3. The employer’s conduct, taken as a whole, amounts to clear bad faith in the performance of their duties under this part; or
  • 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.

8. Subcontractors and Manicurists get a Three-Year Extension on the “ABC” Independent Contractor Test.

AB 1561 (available here) is simple in that it stops the “ABC” test from expiring on January 1, 2022, and extends it until January 1, 2025 for manicurist or a subcontractors. The ABC test is what the government uses to determine if an individual is an employee or an independent contractor. The statute summary itself clearly explains the test:

Existing law requires a 3-part test, commonly known as the ‘ABC’ test, to determine if workers are employees or independent contractors for purposes of the Labor Code, the Unemployment Insurance Code, and the wage orders of the Industrial Welfare Commission. Under the ABC test, a person providing labor or services for remuneration is considered an employee rather than an independent contractor unless the hiring entity demonstrates that the person is:

    1. free from the control and direction of the hiring entity in connection with the performance of the work,
    2. the person performs work that is outside the usual course of the hiring entity’s business, and
    3. the person is customarily engaged in an independently established trade, occupation, or business [source (edited for clarity)].

9. Extension of the Statute of Limitations for Alleged Violations of the Fair Employment and Housing Act

SB 807 (available here) requires employers to preserve personnel records for employees and applicants for four (4) years from the date of creation and extends the time that the Department of Fair Employment and Housing (DFEH) has to bring a civil action for unlawful employment practices.

Previously, the DFEH had 150 days to file an action, but this has been extended to two (2) years. Moreover, the statute of limitations for the alleged aggravated party’s right to file a case is extended by however long it takes the DFEH to decide if they will sue.

In other words, an individual’s right to sue their employer for an alleged unlawful employment practice has been extended by up to two (2) years.

10. Warehouse Workers Given Expanded Rights in Meeting Their Quotas

AB 702 (available here) applies to warehouses with 1,000 or more employees in total or 100 employees in a single warehouse. It requires such employers to provide to each employee information regarding performance quotas—namely, all working objectives based on productivity speed, a quantified number of tasks, or a required amount to be handled or produced. In other words, for any employee with a performance quota, such employers must:

    1. Provide the employee with a written description of each quota to which the employee is subject upon hire or within 30 days of January 1, 2022 (the effective date of the law);
    2. Describe the quantified number of tasks to be performed or materials to be produced/handled;
    3. Define the time period within which the quota must be completed; and
    4. Describe any potential adverse action that could result from failure to meet the quota.

Furthermore, a quota must:

    1. Allow the employee to take a legally required meal or rest break;
    2. Be compliant with occupational health and safety laws; and
    3. Be clearly discussed with the employee.

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