California Employment Law Update: 2018 Is Here. Are You Ready? January 17, 2018 Universal City, California Sponsored by Jackson Lewis, P.C. Tracy Wei Costantino, Esq. Susan E. Groff, Esq. #IHCC12 1
Lawyer s Disclaimer Jackson Lewis P.C. has prepared the materials contained in this presentation for the participants reference and general information in connection with education seminars presented by the firm and its attorneys. Attendees should consult with counsel before taking any actions that could affect their legal rights and should not consider these materials or discussions about these materials to be legal or other advice regarding any specific matter. 090701_2 2
Susan E. Groff Susan E. Groff is a Principal in the Los Angeles, California, office of Jackson Lewis P.C. She advises and counsels management on various employment related issues and is Co-Leader of the California Advice and Counsel Resource Group. Susan advises employers on complying with federal and California requirements for disability accommodation and protected leaves of absence. She also counsels employers on a host of other employment issues, including wage and hour laws, harassment and discrimination complaints, workplace investigations, reductions in force, and discipline and termination questions. Susan further conducts training and seminars on employment related issues, including sexual harassment prevention training. 090701_3 3
Tracy Wei Costantino Tracy Wei Costantino is a Principal in the Los Angeles, California, office of Jackson Lewis P.C.. Tracy s defends employers in wage and hour class action litigation and wrongful termination claims based upon the FEHA and Title VII in both California state and federal courts. She also counsels employers regarding these issues as well in order to help clients reduce risk in terms of future litigation and best practices. Tracy also conducts sexual harassment trainings, seminars, and internal wage and hour trainings for employers. 090701_4 4
About Jackson Lewis Represents management exclusively in every aspect of employment, benefits, labor, and immigration law and related litigation More than 800 attorneys in 58 locations nationwide Current caseload of over 6,000 litigations approximately 800 class actions Founding member of L&E Global A leader in educating employers about the laws of equal opportunity, Jackson Lewis understands the importance of having a workforce that reflects the various communities it serves 090701_5 5
Strategically Located Throughout the Nation to Serve Employers Needs 57 Locations Nationwide* *Jackson Lewis P.C. is also affiliated with a Hawaii-based firm www.jacksonlewis.com 090701_6 6
CA HIRING AND WARN DEVELOPMENTS 7 090701_7
CA Salary Information Labor Code 432.3 Prohibits employers from relying on salary information as a factor in determining: (1) Whether to offer employment; or (2) What salary to offer Prohibits employers and their agents from seeking salary history from applicants Would require private employers to provide the pay scale for a position upon an applicant s request Voluntarily Disclosures? Allowed, but must be truly voluntary NO PROMPTING Information can be considered in determining salary for applicant 090701_8 8
San Francisco Salary History Ordinance Effective July 1, 2018 - All employers Prohibits consideration of applicants salary history as a factor in determining whether to offer employment or salary offer Cannot inquire about applicant s salary history Cannot release salary history of a current or former employee to a prospective employer without written authorization unless required by law, unless salary is determined by a CBA Does not prohibit use of voluntarily disclosed information, but salary history alone cannot justify differences in pay 090701_9 9
Ban the Box Cal. Gov. Code 12952 Effective January 1, 2018 Prohibits employers with 5 or more employees from inquiring about criminal convictions on any application for employment or before making a conditional job offer Exceptions for: Positions for which a state or local agency is otherwise required by law to conduct a conviction history background check Positions with a criminal justice agency Farm Labor Contractors Positions where an employer or agent thereof is required by any state, federal, or local law to conduct criminal background checks for employment purposes or to restrict employment based on criminal history 090701_10 10
Ban the Box Gov. Code 12952 Requires an individualized assessment before rejecting an applicant based on a criminal conviction Individualized assessment must consider: Nature and gravity of the offense or conduct; Time that has passed since offense and completion of sentence; and The nature of job held or sought Must notify applicant of preliminary decision to disqualify in writing and give an opportunity to respond before final decision 090701_11 11
Ban the Box Gov. Code 12952 Notice to Applicant shall contain all of the following: (1) Notice of the disqualifying conviction(s) that is the basis for the decision to rescind the offer (2) A copy of the conviction history report, if any (3) An explanation of the applicant s right to respond before the decision becomes final, including the deadline to respond The applicant shall have at least five (5) business days to respond to the notice If applicant timely notifies the employer in writing that the applicant disputes the accuracy of the conviction history report, then the applicant shall have five (5) additional business days to respond to the notice 090701_12 12
Ban the Box Gov. Code 12952 Employer must consider any information from the applicant before making a final decision Final decision must include: (1) The final denial or disqualification (2) Any existing procedure the employer has for the applicant to challenge the decision or request reconsideration. (3) The right to file a complaint with the DFEH. The employer may, but is not required to, justify or explain the reasoning for the final decision 090701_13 13
City of Los Angeles Ban the Box Ordinance Became effective January 22, 2017. Employers had until July 1, 2017, before penalties may be imposed. Prohibits private employers with at least 10 employees from inquiring into an applicant s criminal history until after a conditional offer of employment. If an employer inquires into an applicant s criminal history after a conditional offer and determines such information warrants an adverse action, the employer must follow the Fair Chance Process. The Ordinance s notice and posting requirements provide that employers must state in all job advertisements that they will consider for employment qualified applicants with criminal histories in a manner consistent with the requirements of this [Ordinance]. 090701_14 14
NEW CAL WARN CASE International Brotherhood of Boilermakers v. NASSCO Holdings, Inc. (Nov. 30, 2017), 2017 Cal. App. LEXIS 1061 (Fourth Appellate Dist.) Employer provided no CA WARN notice before ordering about 90 employees not to return to work for 4 or 5 weeks. Found CA WARN notice required, even if the layoffs were not permanent and for less than 6 months. Court disagreed with the employer that CA WARN was inapplicable because employer s action was a temporary furlough. 090701_15 15
NEW CA LEAVE LAWS 16 090701_16
SB 63 Parental Leave (Effective Jan. 1, 2018) Current law provides up to 12 weeks of leave for bonding for those who: Have 12 months of service with employer Worked at least 1,250 hours in the prior 12-months Work at a worksite with 50 or more employees within a 75 mile radius Under new law, threshold changes to 20 or more employees within a 75-mile radius. Changes definition of employer to be a person who employs 20 or more employees. 090701_17 17
Changes Coming in 2018 One week waiting period for PFL claims will be eliminated Increases benefit formula for some employees for both SDI and PFL Those who earn one-third or more of the state s average quarterly wage during the base period receive the greater of either: (1) 60% of wages; or (2) 23.3% of the state average weekly wage Those who earn less than one-third of the state s average quarterly wage during the base period 70% of wages Amount received from the state is important to know for integration of paid leaves and SF Paid Parental Leave Ordinance 090701_18 18
Sick Leave Laws and Ordinances 090701_19 19
Updated CA PSL FAQs Attendance Policies Cannot assign an occurrence or point for using protected sick leave Can give an occurrence or point if employee does not have accrued/ available paid sick leave and the employee has an unscheduled absence for a reason covered under state law State law, does not protect all time off taken by an employee for illness or related purposes; it protects only an employee s accrued and available paid sick leave as specified in the statute 090701_20 20
Domestic Violence Leave Labor Code section 230.1 - victims of domestic violence, sexual assault or stalking have the right to take protected leave To seek medical attention Obtain services or psychological counseling Participate in safety planning or to seek judicial intervention Effective July 1, 2017 Employers must provide written notice of rights at time of hire and upon request http://www.dir.ca.gov/dlse/victims_of_domestic_viol ence_leave_notice.pdf 090701_21 21
CA Fair Employment and Housing Act Accommodations for EE Family Members?! In Castro Ramirez, the employee alleged that he was terminated from employment after he made complaints about changes to his work schedule which impacted his ability to be at home during his disabled son s dialysis treatments. The Court of Appeal held that the California Fair Employment and Housing Act (FEHA) makes it unlawful to discharge a person based on physical disabilities or other characteristics, including the association with a person who has or is perceived to have any of those characteristics. Arguably imposed obligations to accommodate employees with respect to their disabled family members. Castro Ramirez v. Dependable Highway Express, Inc. (2016) 2 Cal. App. 5th 1028 090701_22 22
WAGE AND HOUR 23
One Day of Rest in Seven Labor Code 551 Every person employed in any occupation of labor is entitled one day s rest therefrom in seven. Labor Code 552 - No employer of labor shall cause his employees to work more than six days in seven. Limited exception for part-time employees Employment does not exceed 30 hours in any week or six hours in any one day. Reminder there is no longer an agricultural worker exception (eliminated on January 1, 2017) 090701_24 24
Mendoza v. Nordstrom California Supreme Court Decision found the day of rest is measured by the workweek defined by the employer, not a 7-day rolling calendar basis Limited exception for part-employees requires: (1) Not work more than 6 hours a day; AND (2) Not work more than 30 hours in a workweek Employees may voluntarily decide to work more than six days in seven 090701_25 25
Take-Aways Document when employees volunteer to work seven consecutive days. Make sure your policy has a defined workweek. Companies with overnight shifts may need to modify the definition of a workweek for those employees Violations of the day of rest statutes can expose an employer to civil penalties of $200 per employee per pay period under California s Labor Code Private Attorneys General Act ( PAGA ), plus an award of attorney s fees and costs against the employer to recover those penalties for all employees. 090701_26 26
Rest Breaks Non-exempt employees who work 3 ½ or more hours per day must be provided a rest break of 10 minutes for each four hours (or major fraction thereof) worked. Major fraction means any time greater than two hours. Rest periods are considered time worked and must be paid. Schedule rest breaks as near as practical to the middle of the work period. Restroom breaks may not be counted towards 10 minute break. 090701_27 27
Augustus v. ABM Security Services Security guards were required to keep radios and pagers on, remain vigilant and respond when needed California Supreme Court held employers can not require employees to be on-call during their rest periods Employers must relinquish all control over how employees spend their break time AND relieve their employees of all duties, including the obligation that an employee remain on call 090701_28 28
Reversal by DLSE Based upon Augustus, the DLSE has officially reversed its position with respect to employers being able to require employees remain on the premises for rest breaks. 090701_29 29
Vaquero v. Stoneledge Furniture LLC Compensation plan provided for a draw of $12.01 per hour that was advanced against future commissions No separate payment for non-selling time, such as time attending meetings or rest breaks Appellate Court found that Wage Order requires employers to separately compensate non-exempt commissioned employees for rest breaks and other non-productive time Appellate Court held that a compensation plan that does not pay employees directly for rest periods undermines the public policy of encouraging employees to take their rest breaks 090701_30 30
What does this mean? Commission-based compensation agreements are still valid in California. BUT employees paid by commissions should also be separately compensated for rest breaks and other non-productive time. This same analysis applies to any other compensation system that does not separately account for rest breaks and other nonproductive time. 090701_31 31
California Minimum Wage 26 or More Employees Currently - $10.50 an hour Will increase each year: January 1, 2018 - $11.00 per hour January 1, 2019 - $12.00 per hour January 1, 2020 - $13.00 per hour January 1, 2021 - $14.00 per hour January 1, 2022 - $15.00 per hour As minimum wage increases, so does minimum salary for exempt employees 090701_32 32
Local Minimum Wage Ordinances 090701_33 33
Agricultural Workers Overtime will be owed as follows: 2019 over 9.5 hours in a day or 55 hours in a week; 2020 over 9 hours in a day, or 50 hours in a week; 2021 over 8.5 hours in a day, or 45 hours in a week; and 2022 over 8 hours in a day, or 40 hours in a week Beginning in 2022, expands double time compensation for time worked over 12 hours in a day. Each phase delayed by 3 years if less than 25 employees Applies to those employed in an agricultural occupation in California, as defined in Wage Order No. 090701_34 34
DISCRIMINATION AND HARASSMENT 35 090701_35
Gender-Neutral Bathroom Rules Effective March 1, 2017 Single-occupancy restrooms to have signs indicating they are gender-neutral Applies to all single-occupancy restrooms in businesses, government buildings, and places of public accommodation 090701_36 36
New FEHA Training and Notice Requirements Effective January 1, 2018 Mandatory sexual harassment training programs must include discussion on preventing harassment based on gender identity, gender expression, and sexual orientation Employers must display a poster issued by California s Department of Fair Employment and Housing regarding transgender rights in a prominent and accessible location in the workplace 090701_37 37
Transgender Regulations Effective July 1, 2017 Prohibits discrimination against a person who is transitioning Employers cannot request information related to sex, including gender expression or gender identity, unless disclosed voluntarily for recordkeeping purposes Cannot ask for proof of gender, gender express, gender identity or sex Requires that employers abide by an employee s request to be identified with a preferred gender, name, and/or pronoun Exception allows use of gender or legal name as reflected on government-issued identification is necessary to meet legallymandated obligations 090701_38 38
Investigations Potential Rise In Claims with the #MeToo Movement and #TimesUp In-house staff (HR or counsel, for example) may conduct investigations in California, special rules apply when a California employer chooses to hire an external investigator. Under the California Business & Professions Code Sections 7520-7539, an external consultant hired to conduct a workplace investigation must be a state-licensed private investigator or statelicensed attorney. Human resource consultants who are not licensed attorneys or private investigators cannot legally conduct such investigations. Insurance adjusters do not qualify either. 090701_39 39
Zetwick v. County of Yolo Correctional officer claimed sexual harassment based on more than 100 hugs, and a kiss at least once, in a 12-year period Employer alleged that the conduct was not objectively severe or pervasive enough to establish a hostile work environment, but merely innocuous, socially acceptable conduct." District Court granted summary judgment for employer Ninth Circuit reversed 090701_40 40
Zetwick v. County of Yolo Court held the behavior could be harassment depending on "the number of times or the period of time" the events occurred. Jury could find the conduct out of proportion to 'ordinary workplace socializing'" and "abusive." Court rejected the efforts to reduce the number of hugs to a mathematical formula and noted that the district court failed to consider: whether a reasonable juror would find that hugs, in the kind, number, frequency, and persistence described by Zetwick, create a hostile environment ; and "the potentially greater impact of harassment from a supervisor and, indeed, the highest ranking officer in the department." 090701_41 41
Lesson Learned Efforts to improve or foster a genial corporate culture must be tempered with maintaining a professional work environment. 090701_42 42
Santillan v. USA Waste of California Garbage truck driver was terminated after four accidents in a 10-month period Employer hired a younger employee to fill position Driver filed a grievance challenging termination Employer settled grievance by agreeing to reinstate if he passed a drug test, physical exam, criminal background check and proof of right to work through e-verify Employee provided driver s license, social security card, work authorization number, but no expiration date for authorization Employer terminated because it could not complete electronic employment verification without the expiration date 090701_43 43
Santillan v. USA Waste of California Employee alleged age discrimination and retaliation for having an attorney during the settlement negotiations District court granted summary judgment for employer Ninth Circuit reversed and rejected the employer s claim of a legitimate business reason for termination due to failure to provide an expiration date for his work authorization Ninth Circuit found that the employer had an incorrect view of the Immigration Reform and Control Act of 1986 Employee had provided the appropriate documents to prove his right to work Employee was continuing employment ; he was not a new employee Also held that conditioning reinstatement on verification of immigration status violated CA public policy 090701_44 44
14 th Annual In-House Counsel Conference January 17, 2018 (Universal City, CA) www.acc.com/chapters/socal/ 45 000000_45
090701_46 THANK YOU TRACY W. COSTANTINO Tracy.Costantino@jacksonlewis.com SUSAN E. GROFF Susan.Groff@jacksonlewis.com JACKSON LEWIS P.C. 725 S. FIGUEROA ST., #2500 LOS ANGELES, CA 90017 (213) 689-0404