2017 brings modifications to employee wage, benefit and discrimination laws among others

By Joseph Ortiz, Partner, Best Best & Krieger LLP.

Californians are starting to feel the effects of new labor and employment laws passed in 2016 that raise the state’s minimum wage, aim to erase wage gaps, protect immigrant and disabled workers, as well as establish gender-neutral public bathroom regulations.

Below, we’ve broken down some of the biggest changes employers and employees will see in 2017 and beyond. Employers should take note of the changes to ensure compliance and plan for changes to come.

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Senate Bill 3: California Minimum Wages Rises to $10.50, More Increases to Come

With the Fair Wage Act of 2016 signed into law, California’s minimum wage raises from $10 an hour to $10.50 an hour for employers with more than 25 employees. SB 3 does not raise the minimum wage by 50 cents for employers with less than 25 employees until January 2018.

The Act lays out a minimum wage increase schedule that incrementally raises California’s base standard of pay to $15 an hour by 2022. It also grants the governor temporary authority to suspend increases based on certain economic factors.

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Assembly Bill 488: Extended Anti-Discriminatory Protections for Workers with Disabilities

Californians employed under a special license permitting employment at wages lower than the minimum wage will now have greater protection against workplace discrimination and sexual harassment under AB 488.

The bill extends Fair Employment and Housing Act protections to individuals working in a nonprofit sheltered workshop, day program or rehabilitation facility to guarantee they receive the same safeguards against discrimination based on the characteristics of race, religion, sex, gender expression, national origin, ancestry, marital status, age or sexual orientation that other workers are granted.

Such workplaces have long been considered temporary centers providing specialized job training for individuals with disabilities but often see long-term employment. Under the bill, employees are able to bring action against employers for forms of harassment and discrimination prohibited under FEHA.

The same workplace protections were extended to unpaid interns and volunteers back in 2014.

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Assembly Bill 1676: Applicant Salary History Cannot Justify Gender Wage Gaps

With AB 1676, California continues to lead the nation in closing the gender wage gap.

As of 2015, the nation’s gender wage gap stood at 80 cents to the dollar, according to data from the U.S. Census Bureau — a wage inequality that worsens for women of color. The bill amends California’s Fair Pay Act, which took effect in 2016, to state an applicant’s prior salary cannot — by itself — justify paying different wages based on gender.

The law aims to guarantee both employers and workers a seat at the bargaining table where a salary can be negotiated and set based on job requirements, expectations and qualifications rather than on prior pay that could reflect pervasive gender-based wage disparities.

Thus, employers cannot use discriminatory pay rates to validate ongoing wages differences.

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Senate Bill 1063: Equal Pay for Equal Work Expansion Targets Race, Ethnicity

This year saw further changes to the Fair Pay Act.

As a compensation gap exists among men and women, so too does an inequality between races and ethnicities. The Wage Equality Act of 2016, or SB 1063, moves California toward eliminating wage disparities by increasing equal pay requirements beyond sex to incorporate race and ethnicity.

Word-for-word, the Fair Pay Act’s provisions were extended to account for a person’s race and ethnicity.

The law restricts employers from paying any employee at a rate less than another performing “substantially similar” work, unless the company has a validated defense. In keeping with the Fair Pay Act, SB 1063 necessitates businesses exhibit the following factors in justifying a wage difference:

  1. A seniority system
  2. A merit system
  3. A system measuring earnings by quantity or quality of production

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Assembly Bill 1732: Gender-Neutral Signs Required for Single-User Toilets

Single-occupancy restroom facilities in businesses, government agencies, schools and public places must be designated with gender neutral signage under AB 1732.

The law reinforces California’s nation-leading role in protecting gender identity and gender expression.

Compliance simply requires changing signage on restroom doors. The law becomes effective in March 2017.

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Assembly Bill 1843: Juvenile Crimes Off Limits for Potential Employers

California employers can no longer ask potential employees to disclose juvenile crimes.

AB 1843 prohibits potential employers from inquiring about information related to a job applicant’s “arrest, detention, processing, diversion, supervision, adjudication or court disposition” that occurred in the juvenile justice system.

It also bars employees from using this information as a condition of employment.

California Labor Code already prohibits public- and private-sector employers from asking applicants to disclose — or use as a factor in determining employment — information about an arrest or detention that did not result in a conviction or a conviction that has been judicially dismissed or sealed.

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Assembly Bill 2337: Employee Awareness of Time Off Right Related to Domestic Violence, Assault

Existing California law provides victims of domestic violence, sexual assault or stalking the right to take time off work without discrimination or retaliation from their employers.

The unanimously passed AB 2337 ensures all employees are informed of this right by requiring employers to provide written information to new hires and to other employees upon request. The bill also directs the Labor Commissioner to draft a template that employers can use for this purpose by July 2017. Employers will not be required to come into compliance until the form is released.

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Assembly Bill 2532: Eliminating Legal Status Verification Requirement for Employment Services

California has taken measures to enact further protections for immigrant workers.

AB 2532 repeals existing state law requiring government agencies to verify an individual’s legal status prior to providing employment services.

The law does not change work eligibility requirements but does remove anti-immigrant language from state law. Federal regulations continue to require an individual’s legal status or authorization to work be verified before employment services for a fee are provided.

This law specifically applies to any state and local government agencies, as well as private employers contracting with such public agencies.

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Assembly Bill 2843: Public Workers Exempt from Personal Contact Information Disclosure

The California Public Records Act exempts from public disclosure the home addresses and telephone numbers of state, school district and county office of education employees but did not expressly extend this exemption to other public employees. AB 2843 alters that.

The bill updated the public records law exception to include cell phone numbers and birthdays while extending the personal information disclosure exemption to all public employees.

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Assembly Bill 2899: New Requirements for Employers Challenging Minimum Wage Violations

Employers in violation of local minimum wage laws, who have been issued a citation, are assessed civil penalties, restitution of wages, liquidated damages and any other applicable penalties.

Such citations can be contested before the Labor Commissioner. Under AB 2899, any employer who chooses to contest a Labor Commissioner violation through writ of mandate must first post a bond in amount equal to the total minimum wages, liquidated damages and overtime owed.

The bill also mandates if an employer fails to pay total of minimum wages, liquidated damages or overtime compensation owed within 10 days of a judgment’s entry, dismissal or withdrawal of writ, then the entire bond is forfeited to the aggrieved employee or employees.

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Senate Bill 1001: Limits Employers from Extending Federal Requirements to Verifying Statues

SB 1001 makes it unlawful for employers to request information different from, or in addition to, already existing federal requirements for purposes of employment authorization.

The law prohibits employers from:

  1. Requesting more or different documents than required under state law
  2. Refusing to honor documents tendered that on face value reasonably appear to be genuine
  3. Refusing to honor documents or work authorization based upon the specific status
  4. Reinvestigating an employee’s authorization to work using unfair immigration-related practices

Aggrieved employees can file complaint with the Department of Labor Standards Enforcement. Penalties can be up to $10,000.

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Assembly Bill 908: Paid Family Leave Benefits See Expansion in 2018

State lawmakers took action this year to ease financial burdens facing workers who take time off to care for a new baby or ill family member.

Under AB 908, Californians qualifying for paid family leave will see their weekly wage-replacement benefits increase from the current threshold of 55 percent to 60 and 70 percent depending on income level. The bill was aimed to address inequities partial pay posed for lower-income workers.

The PFL program is exclusively funded by worker contributions — much like Social Security. It is jointly administered by the Employment Development Department and State Disability Insurance program. California’s SDI program will see similar increases under AB 908.

These expansions take effect in January 2018.

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Assembly Bill 1066: Phasing in New Thresholds for Farmworker Overtime Pay 

The Phase-In Overtime for Agricultural Workers Act of 2016, or AB 1066, will gradually lower the agricultural worker’s current overtime threshold for work exceeding eight hours in a single day.

Beginning in 2019, the 10-hour-day threshold for overtime pay will be reduced by 30 minutes until it reaches the eight-hour standard seen across the State’s labor sectors in 2022. A 40-hour workweek will also be phased in for the first time.

The four-year breakdown for employers with more than 25 employees who will have to be paid time and a half for work exceeding the newly set threshold is:

  • 5 hours per day or 55 hours per week (January 2019)
  • 9 hours per day or 50 hours per week (January 2020)
  • 5 hours per day or 45 hours per week (January 2021)
  • 8 hours per day or 40 hours per week (January 2022)

The bill also authorizes the governor to temporarily suspend this phase-in schedule if minimum wage increases are also suspended based on economic conditions.

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ortiz_joseph-c2Joseph Ortiz is a partner with Best Best & Krieger, based in the firm’s Riverside office. An experienced trial and human resources attorney, Ortiz represents municipal and private employers in all types of employment law-related matters, including HR consultations, labor negotiations, administrative hearings and litigation. He can be reached at joseph.ortiz@bbklaw.com.