Slew of new employment laws to hit the books in 2013

Employment is one of the most highly regulated relationships that any business faces. Especially in California, where employer obligations and employee rights are expansive and constantly shifting, violations are often very costly, and monitoring new and modified legal requirements and complying with them is critical. Employers should pay special attention to the following bills signed by Gov. Jerry Brown that go into effect in 2013.

Wage and hour

SB 1255: Labor Code Section 226 requires an employer to furnish an itemized wage statement to each employee semi-monthly or at the time of each payment of wages. The obligation to provide a statement applies even if the employee has authorized payment by automatic deposit to a bank account. Section 226 sets forth a number of required categories of information that a compliant wage statement must contain. Previously, an employee who did not receive a compliant statement could recover penalties in an amount up to $4,000 if that employee could demonstrate "injury" as a result of the employer's knowing and intentional failure to comply with Section 226. However, SB 1255 amends Section 226 to state that the employee is deemed to suffer injury if the employer fails to issue compliant wage statements. Thus, the new law enables an employee who receives a noncompliant wage statement (or does not receive a wage statement at all) to more easily collect substantial penalties from the employer. Employers should carefully review their policies and pay practices with respect to issuing wage statements to ensure they are compliant with Section 226.

AB 1744: AB 1744 amends Labor Code Sections 226 and 2810.5 and adds Section 226.1. The bill requires, effective July 1, 2013, temporary employers to include in the itemized wage statements the rate of pay and the total hours worked for each assignment. Furthermore, the new law requires temporary service employers to include the name, physical address of the main office, mailing address if different, and telephone number of the legal entity for which the employee will perform work, and any other information the Labor Commissioner deems material and necessary on the Wage Theft Notice every employer must provide to each new employee.

AB 2103: AB 2103 amends Labor Code Section 515 with respect to the payment of a fixed salary to nonexempt employees. Specifically, AB 2103 provides that payment of a fixed salary to a nonexempt employee shall be deemed to provide compensation only for the employee's regular hours, notwithstanding any private agreement to the contrary. In other words, a fixed salary to a nonexempt employee may not include any overtime pay to which the employee might be entitled. An employer may not purport to hire a nonexempt employee based on a fixed salary, e.g., $800 per week, and later claim that the salary included overtime worked and paid. Employers using a fixed salary should use the amount of that salary in calculating the regular rate of pay, convert that into an hourly rate and multiply that rate by 1.5 for hours exceeding 8 hours per day or 40 per week or by 2 for hours in excess of 12 hours per day in computing overtime. The overtime rate and pay should be separately identified on the employee's pay statement.

AB 2675: AB 2675 amends Labor Code Section 2751 regarding employment contract requirements for employees paid on a commission basis. Existing law requires that employment contracts contemplating commission payments must be in writing and must set forth the method by which the commissions are to be calculated and paid. The new law exempts from this requirement any temporary and/or variable incentive payments that increase, but do not decrease, payment under the written contract.

AB 2396: AB 2396 amends Labor Code Section 1308.10 regarding the employment of infants on a motion picture set. Existing law prohibits the employment of an infant under the age of one month unless a board-certified pediatric physician and a surgeon certify that certain health requirements have been met. AB 2396 requires that a medical certification be provided before a temporary permit for the employment of the infant may be issued.

EEO compliance

AB 1964: Under existing law, the California Fair Employment and Housing Act (FEHA) requires an employer to reasonably accommodate the religious belief or observance of an individual unless the accommodation would be an undue hardship on the conduct of the business of the employer or other entity. AB 1964 includes religious dress practices or religious grooming practices as beliefs or observances covered by the FEHA. The new law requires employers to provide a reasonable accommodation of an individual's religious dress practice or religious grooming practice absent undue hardship. The accommodation cannot require that the employee be segregated from the public or other employees. The extent to which the enforcement of employers' uniform dress codes and appearance standards and wearing of safety equipment and clothing will conflict with AB 1964 and result in litigation remains to be seen.

AB 2386: Existing federal and state law requires employers to provide a reasonable accommodation for lactating mothers. California Labor Code Sections 1030, et seq., require all employers to provide breaks for lactating women as well as use of a room or other location, other than a toilet stall, in close proximity to the employee's work area, for the employee to express milk in private. Furthermore, the FEHA prohibits discrimination on the basis of "sex." Under existing law, "sex," for purposes of the FEHA, includes gender, pregnancy, childbirth, and medical conditions related to pregnancy or childbirth. This new law provides that, under the FEHA, the term "sex" also includes breastfeeding or medical conditions related to breastfeeding. Thus, in addition to accommodating lactating employees, the new law insulates lactating employees as a protected class that cannot be harassed, retaliated against, or discriminated against. Employers also will be required to provide employees with an update to their anti-discrimination/harassment notice.

Social media privacy

AB 1844: AB 1844 prohibits an employer from requesting or requiring an employee or job candidate to disclose that individual's username and/or password to personal social media sites. Similarly, the bill forbids employers from requesting an employee or job candidate to access a personal social media site in the employer's presence. Finally, the bill prohibits an employer from retaliating against an employee or candidate for not complying with a request or demand by the employer that violates these provisions.

Personnel records

AB 2674: AB 2674 amends Labor Code Sections 226 and 1198.5 regarding inspection of personnel records by employees. In addition to requiring employers to furnish itemized wage statements, existing law requires employers to keep a copy of the statement and a record of any wage deductions on file for three years. Existing law also provides an employee the right to inspect the personnel records an employer maintains with respect to the employee's performance or to any grievance concerning the employee. AB 2674 requires the employer to maintain personnel records for three years following an employee's separation from employment. It also permits current and former employees to inspect and receive copies of their personnel records within 30 days of submitting a records request. Furthermore, under the new law, an employer is not required to comply with more than one request per year by a former employee or with more than 50 requests per month by employees' representatives, with certain exceptions. Finally, an employer must develop a written form that employees may use to request inspection and a copy of personnel files and furnish this form to employees upon request.

Conclusion

As California employment laws multiply and become even more complex, employers should consider the equivalent of an "annual physical," that is a thorough audit of all personnel practices to ensure that guidelines and practices meet current standards.