California employers should take steps to ensure compliance with several new employment laws that take effect January 1, 2016. This article covers important provisions in some of those laws. 

1. Wage and Hour Laws 

• The Fair Pay Act (Senate Bill 358)

SB 356, known as the Fair Pay Act, significantly changes the California Equal Pay Act related to gender wage inequality. The bill prohibits an employer from paying any of its employees at wage rates less than the rates paid to employees of the opposite sex for substantially similar work, except where the employer demonstrates the pay differential is based on 

a) A seniority system;
b) A merit system; 
c) Productivity;
d) A “bona fide factor other than sex” (for example, education, training, or experience), if the employer can demonstrate the factor is not based on or derived from a sex-based differential in compensation, is job related with respect to the position in question, and is consistent with a business necessity).

The bill imposes substantial penalties on an employer found to violate the law, including double the difference in wages and attorney’s fees incurred by an employee if a lawsuit is under the law is brought. The bill also prohibits discharging, discriminating, or retaliating against an employee for invoking rights under the law. 

We discussed the Fair Pay Act here: What California’s New Fair Pay Act Means for Employers. 

• State-Wide Minimum Wage Increases to $10.00 (Assembly Bill 10 (2013))

AB 10, passed in 2013, raised the minimum wage in California in two increments: from $8.00 to $9.00 per hour on July 1, 2014, and from $9.00 to $10.00 per hour on January 1, 2016. 

The increase has several impacts on California employers, including increasing the minimum salary threshold for an employee to qualify for the “white collar” overtime exemption. On January 1, 2016, the minimum annual salary for an employee to qualify for the exemption will be $41,600. 

• Right to Fix Pay-Stub Errors for Employers (Assembly Bill 1506)

AB 1506 amends portions of California’s Private Attorneys General Act of 2004 (PAGA) to provide relief to employers guilty of technical violations of California’s wage statement laws. Those laws require that certain information be included on employee pay stubs, including the name and address of the employer, wages earned, hours worked, deductions, and the inclusive dates of the pay period. (SeeLabor Code § 226(a).) Employers failing to meet section 226’s requirements can be liable for penalties under PAGA. 

The law amends PAGA to give employers the right to cure certain pay stub violations; namely the failure to include the employer’s name and address and inclusive dates of the payroll period on the pay-stub. The law gives employers 33 days from the date of the employee’s notice to the California’s Labor and Workforce Development Agency to provide compliant wage statements. The bill limits the employer’s right to cure alleged violations to once in a 12-month period. 

For further discussion, see: New Law Gives CA Employers Limited Right to Fix Pay-Stub Errors

• Piece-Rate Compensation (Assembly Bill 1513)

AB 1513 clarifies the pay requirements for piece rate workers for nonproductive time and rest and recovery period time. Specifically, AB 1513 requires employers pay piece rate workers for rest and recovery periods, at the higher of the employee’s average hourly wage or the minimum wage. It also provides for payment of other “nonproductive” time – defined as “time under the employer’s control, exclusive of rest and recovery periods, that is not directly related to the activity being compensated on a piece-rate basis” – at an hourly rate no less than the applicable minimum wage. 

The law also establishes a process through which employers can make back wage payments for uncompensated rest and recovery periods and nonproductive time from July 1, 2012, to December 31, 2015, in exchange for relief from statutory penalties and other damages.

2. Employee Protections & Leave Laws 

• Protections for Employees Requesting Reasonable Accommodations (Assembly Bill 987)

AB 987 prohibits an employer from retaliating or otherwise discriminating against a person for requesting accommodation of his or her disability or religious beliefs, regardless of whether the accommodation request was granted. The amendment overrules the holding in Rope v. Auto-Chlor System of Washington, Inc. (2013) 220 Cal.App.4th 635, which held that request for an accommodation does not, without more, constitute grounds for a retaliation claim under the California Fair Employment Housing Act.

• Protections for Family Members of Employees for Engaging in Protected Activity (Assembly Bill 1509)

AB 1509 prohibits an employer from retaliating or otherwise discriminating against a person who is a family member of a person who engaged in protected conduct. 

• Protection From Discrimination by Business Establishments on the Basis of Citizenship, Primary Language, and Immigration Status (Senate Bill 600)

SB 600 adds three additional protected categories to California’s Unruh Civil Rights Act, which provides for full and equal accommodations in all business establishments: citizenship, primary language, or immigration status. The bill provides that verification of immigration status and any discrimination based upon verified immigration status, where required by federal law, shall not constitute a violation of the law. In addition, the bill provides that it shall not be construed to require the provision of services or documents in a language other than English, beyond what is otherwise required by other provisions of federal, state, or local law. 

• Kin Care & Child-Related Activities Leave Expanded (Senate Bill 579) 

SB 579 makes significant changes to California’s “kin care” law (Labor Code § 233), by expanding the definition of “family member,” to align with the definition used in the new Paid Sick Leave law, and expanding the circumstances which an employee may use one-half of their annual accrued sick leave for (a) the diagnosis, care, or treatment of an existing health condition of, or preventive care for, an employee or the employee’s family member; and (b) an employee who is a victim of domestic violence, sexual assault, or stalking. 

The bill also expands California’s Child-Related Activities Leave law (Labor Code § 230.8) to include additional reasons an employee may take job-protected time off from work. The bill provides for up to forty hours of unpaid time off for employees to participate in school and childcare activities, including (a) to find, enroll, or reenroll their children in school or licensed child care provider or to participate in activities of the school or licensed child care provider of his or her child, and (b) to address a child care provider or school emergency. 

3. Other

• Restrictions on Use of E-Verify (Assembly Bill 622)

AB 622 expands the definition of an unlawful employment practice to prohibit an employer from using the federal E-Verify system to check the employment authorization status of an existing employee or an applicant before they are offered a position, except as required by federal law. The bill provides for a civil penalty of $10,000 for each violation of the law.

• Job Protection for Grocery Workers (Assembly Bill 359)

AB 359 establishes a worker retention requirement upon a change in control of a grocery store. The law requires an incumbent employer to prepare a list of specified eligible grocery workers for a new employer, and requires the new employer to hire from this list during a 90-day transition period. The bill requires the new employer to retain eligible grocery workers for a 90-day period, prohibits the new employer from discharging those workers without cause during the 90-day period, and, upon the close of the 90-day period, requires the new employer to “consider” offering continued employment to those workers.

For further coverage of this bill, see: CA Adopts New Job Protections for Grocery Workers

Employers should familiarize themselves with the new laws and review their policies and practices to ensure compliance. Employers are encouraged to partner with experienced legal counsel in resolving any issues that arise and in responding to questions they have when trying to keep up with California’s changing employment law landscape.

For more information contact:

Gary E. Scalabrini, Esq. 
Gibbs Giden Locher Turner Senet & Wittbrodt LLP 
1880 Century Park East 12th Floor
Los Angeles, CA 90067
email: gscalabrini@gibbsgiden.com

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