New Employer Laws 2018: After Two Quiet Years, California State Legislators Hammer Job Creators (Employers)

Summary:

• LC 1182.12 Reminder CA Minimum Wage Goes Up January 1, 2018
• Time To Redo Your Job Applications
  • AB 168 California Employers Cannot Ask for Salary Information or Rely On Salary Info In Hiring Decision or Salary Decision
  • AB 1008 California Employers Cannot Ask For Any Conviction History On Application
• SB 63 California Employers With 20+ Employees Must Allow Parental Leave
• SB 450 California Employers Now “Sanctuary Workplaces” Whether They Like It Or Not
• SB 490 California Employers Employing Barbers, Cosmetologists, Estheticians Now Subject To Unique Minimum Wage Law
• SB 306 Ever Expanding Powers of California Labor Commissioner

Reminder CA Minimum Wage Goes Up January 1, 2018

For employers with 26 or more employees that means $11/hour.

For employers with 25 or less that means $10.50/hour.

Keep in mind California minimum wage has a ripple effect:

1. For salary exempt employees, the salary must be the equivalent of at least twice the California minimum wage. That means the minimum salary must be $45,760 for employers with 26+ employees and $43,680 for employers with 25 or less employees. The math is 2x the minimum wage times 2080 hours per year (52 weeks x 40 hours per week). And remember just because you pay an employee a “salary,” does not make them exempt. There other legal requirements for an employee to be “exempt.” See our post: Paying A Salary Does Not Make Someone Exempt.
2. For employers that employ barbers, cosmetologists, estheticians and anyone else licensed under the Barbering & Cosmetology Act you may have to pay an hourly base wage of at least twice the minimum wage if you pay a certain way. See below California Employers Employing Barbers, Cosmetologists, Estheticians Now Subject To Unique Minimum Wage Law.

Time To Redo Your Job Applications

Two big no-nos starting January 1, 2018 during the application process: 1) asking for or relying on salary history/range; and 2) asking for convictions, including felony convictions.

Days are gone when you can ask about salary information prior to the hiring decision. Just don’t do it. It’s now a violation of California Labor Code section 432.3 (as of 1/1/2018). If applicant voluntarily coughs up salary info, that’s ok. If employee asks for salary/pay range employer must provide it.

Convictions, that’s out as well. Nada. California used to allow employers to ask about convictions, excluding certain marijuana convictions. As of January 1, 2018, employer can’t ask about convictions, period.

California employers can ask about convictions after making a conditional offer of employment. But then if you ask and you don’t like the answer, you have to follow a procedure before rescinding the offer.

In a nutshell, you must:

1. First consider whether the conviction is job related – no assumptions please – and conduct a “individualized assessment.” Government Code section 12952 requires you to: a) consider the nature/gravity of the offense or conduct; and b) lapse of time since the conviction. We would also encourage you to consider the nature of the offense against the job duties. For example, a vehicular manslaughter conviction 15 years prior when the applicant was 20 years old, might not be job related for a network systems analyst position. Change the facts, assessment can change.
2. If preliminary decision is to rescind conditional offer, you must provide written notice that identifies the conviction(s), provides a copy of the conviction report, if any, and informs applicant of right to respond with evidence challenging accuracy of the conviction(s), rehabilitation and/or mitigating circumstances.
3. Applicant has 5 business days to inform you of intent to rebut plus 5 more business days to provide rebuttal evidence.
4. Employer must consider any information timely submitted before making a final decision. If final decision is to deny, then employer must provide another writing saying the decision is final, informing applicant of any process to challenge the decision or request reconsideration, if any, and the right to file a complaint with the government.

California Employers With 20+ Employees Must Allow Parental Leave

California continues to make managing employee attendance difficult.

In the author’s experience, managing employee attendance in California is a Top 3 employee issue for employers. There are so many protected reasons for not working, California employers of any size have a hard time complying with all the laws while trying to keep customers happy.

Now, employers with 20 or more employees within 75 miles must allow up to 12 weeks of “new parent leave” to employees who have been employed at least 12 months and who have worked at least 1250 hours in the previous 12 month period.

Many of you will recognize these rules as similar to those of the federal Family Medical Leave Act (FMLA) and the California Family Rights Act (CFRA). You would be correct. Those laws allow up to 12 weeks protected leave to employees for birth or adoption of a child and “baby bonding” time within the first 12 months of birth/adoption among other reasons.

This “baby bonding” time that only used to apply to larger employers with 50 or more employees now applies to smaller California employers, those with 20 or more employees.

This “baby” FMLA/CFRA law applies to eligible employees for birth, adoption or foster care placement.

If both parents work for same employer, the maximum parental leave is 12 weeks to be split between them. While the law is silent as to domestic partners you should assume the law would apply to domestic partners who have a new child.

California Employers Now “Sanctuary Workplaces” Whether They Like It Or Not

Last I checked your workplace was your private property, whether owned (or leased). If you wanted to allow persons on your property (or not), seems that should be your prerogative.

Not anymore. California has made all businesses “sanctuary workplaces” whether the owner likes it or not. Sure a California employer may choose to engage in “civil disobedience.” But it could come at a price: $2,000-$5,000 for a first offense, $5,000 – $10,000 for each subsequent one.

As of January 1, 2018, AB 450 makes it a violation of state law for an employer to voluntarily allow a federal immigration enforcement agent to enter any “nonpublic areas of a place of labor” without a judicial warrant. Same goes for access, review, acquisition of employee records without a subpoena or judicial warrant.

Yes, there are exceptions. For I-9 inspections/audits, a California employer may comply but must post the notice of inspection/audit at least 72 hours before the inspection/audit date (of course to warn any undocumented workers to get out of dodge).

Also, the law has a general exception to all provisions, “except as otherwise required by federal law.” Interesting as immigration law is the sole province of federal law. Seems this California law makes California employers pawns in the state’s chess match with the federal government.

One takeaway: The I-9 process is a federal legal requirement. Just do them correctly within 3 business days 100% of the time. Don’t hire undocumented workers. That way, while this new California law might offend your principles (or not), the reality is it won’t matter if you don’t have any undocumented employees. When California becomes its own sovereign nation then you can blow off United States law.

California Employers Employing Barbers, Cosmetologists, Estheticians Now Subject To Unique Minimum Wage Law

If you own a hair salon or spa that employs barbers, cosmetologists or estheticians, you no doubt are aware of AB 1513 (now Labor Code section 226.2).

Prior to AB 1513, many salons paid their stylists as a percentage of revenues generated by the stylist. For example, if a stylist generated $4,000 in revenue during a two week pay period, a salon might pay the stylist 40% of the $4,000, or $1,600.

Some salon owners believed AB 1513, which applies to “employees . . . compensated on a piece rate basis,” applied to this compensation method. If paying a percentage of revenue is paying on a “piece rate basis,” then AB 1513 requires salons/spas in addition to the percentage of revenue to: 1) pay all “non-productive” time (i.e. time not providing a service to clients, such as wait time or clean up time) at minimum wage or greater; and 2) pay separately for rest/recovery periods at essentially a weighted average rate.

As a result, the author is informed and believes some within the salon industry sponsored and pushed SB 490 through the California Legislature. This law passed without opposition and was enrolled October 15, 2017. It allows use of a “commission” but with strings attached.

First, SB 490 defines “commission” in this context as “a percentage or a flat sum portion of the sums paid to the employer by the client recipient of such service.” It then says, employer can pay a “commission” in addition to a “base hourly rate.” The catch: the “base hourly rate” must be at least “two times the state minimum wage rate for all hours worked.” Hours worked means all hours under the employers control, and includes not only time when performing services, but also what AB 1513 calls “non-productive time,” and rest/recovery period time.

Bottom line: if you want to pay your barber, cosmetologist or esthetician a “commission” then the bidding starts at $22/hour (as of January 1, 2018, or $21 if you happen to have 25 or less employees) as a base for all hours worked.

We suggest you find some other way to pay them. Whatever you do, you shouldn’t pay on a “piece rate” basis (unless you want to comply with AB 1513) or a “commission” as defined by SB 490.

Or, raise your prices to cover the increased labor cost.

Expanding Powers Of California Labor Commissioner To Rule On Wrongful

Termination/Retaliation/Discrimination Resulting from Labor Code Violations

This is nothing new. California has been on a tear to expand wage and hour obligations on California employers. Hard to keep up with it all, not only for California employers but those who are supposed to enforce them.

Employees can sue in court (state and federal) and before the California Labor Commissioner. They can already sue for themselves only or on behalf of themselves and their similarly situated coworkers, either via a representative action (Private Attorney General Act (PAGA)) or class action.

Anecdotally, the author believes 75-80% of the employee litigation in California courts are for “wage and hour” claims. These claims include claims for unpaid minimum wage, overtime, rest and meal period penalties, wage statement errors (Labor Code section 226), waiting time penalties (Labor Code section 203). More recently California has added Paid Sick Leave (Labor Code section 246) to the list of obligations on California employers.

Labor Code section 98.7 has traditionally required an employee complaint of retaliation before the Labor Commissioner could investigate. SB 306 amends that section to allow the Labor Commissioner to act even without a complaint by the employee if the Labor Commissioner believes if retaliation or discrimination is suspected during a wage claim or investigation. And this goes for “unfair immigration practices” as defined in Labor Code sections 1019 and 1019.1.

Any questions or concerns, call us 855-534-5504 for an attorney experienced and knowledgeable in employment and labor law. Vision Law® Legal Counsel and Protection for Employers.