California employment law landscape for 2023

The California legislature was active as ever in 2022, and the outcome is a myriad of new obligations for employers in 2023 and beyond. While employers in the Golden State continue to focus on the effects of the COVID-19 pandemic on the workplace, they must also adjust to new laws in the areas of leaves, benefits, privacy rights and more. Employers should consider reviewing these legislative changes and consult with legal counsel to make necessary adjustments to workplace policies and practices.

SB 951: Increased benefits under the state disability insurance program

On Sept. 30, 2022, Gov. Gavin Newsom signed SB 951, which most notably will revise the formulas used for calculating the weekly benefits available for qualified applicants under California's family temporary disability insurance program. Starting in 2025, this increases the disability benefits, including paid family leave, that low-wage earners may apply for while out on unpaid leaves, such as under the California Family Rights Act (CFRA) and the federal Family Medical Leave Act (FMLA).

AB 1949: Bereavement leave is now mandatory, and may be paid

Under Assembly Bill (AB) 1949, effective Jan. 1, 2023, it will be illegal for employers with five or more employees to deny employees up to five days of unpaid bereavement leave upon the death of a family member, so long as: (1) the employee seeking leave was employed for at least 30 days before the commencement of leave, and (2) for private employers, the employer has five or more employees. There are separate requirements for public employers. Notably, eligible private employees do not include those under collective bargaining agreements when their agreements expressly provide: (1) equivalent bereavement leave and for the wages, hours of work, and working conditions of the employees, and (2) premium wages for all overtime hours worked, where applicable, and a regular hourly rate of pay for those employees of not less than 30 percent above the state minimum wage.

If an employer already has a bereavement leave policy in place, they can still have their employees take leave under that existing policy, but if the policy provides less time off than under AB 1949, then additional time off must be granted to align with the new legislation. While bereavement leave can be taken on non-consecutive days, it must be completed within three months of the death of the family member. Under the legislation, family members are defined to include: (a) spouses, (b) children, (c) parents, (d) siblings, (e) grandparents, (f) grandchildren, (g) domestic partners, and (h) parents-in-law.

While AB 1949 appears to be a simple expansion of the unpaid leave already afforded to employees under the CFRA, the new law goes further. Instead of strictly unpaid leave, it allows employees to use both accrued and available paid sick leave, as well as vacation time, for bereavement purposes. AB 1949 changes bereavement leave from optional for employers to mandatory.

SB 523: The Contraceptive Equity Act of 2022 will expand reproductive health care protections for employees and health care options for insureds

While reproductive health care in 2022 was thrust into the spotlight in large part due to the U.S. Supreme Court's ruling in Dobbs v. Jackson Women's Health Organization, California has not shied away from making legislative decisions that expand protections related to reproductive care. SB 523, known as the Contraceptive Equity Act of 2022, rolls out significant changes to California's employment laws to take effect on Jan. 1.

The new legislation expands protections related to reproductive health decision-making. Under California's Fair Employment and Housing Act (FEHA), the list of protected categories is now expanded to include "reproductive health decision-making," which, under the new law, "includes, but is not limited to, a decision to use or access a particular drug, device, product, or medical service for reproductive health." This means that employers are forbidden from discriminating against an employee or applicant based on "reproductive health decision-making" or requiring employees to disclose information related to "reproductive health decision-making" as a "condition of employment, continued employment, or a benefit of employment."

AB 2693: COVID-19 notice requirements are extended but also eased to allow for posting notices

AB 2693 extends existing legislation regarding COVID-19 exposure notification requirements. Now, an employer's duty to provide such notification continues for an additional year, until January 2024. Notably, AB 2693 also amends the notice requirements. Previously, employers were required to provide individual written notice within one business day of exposure. Now, employers have the option to post a notice of potential exposure instead. The notice must be "prominently" displayed for 15 days "in all places" where workplace rules are customarily posted. Employers who opt to post a notification must maintain for three years a log of all dates the notice was posted and make the log accessible to the Labor Commissioner.

AB 1632: Employee restroom access for individuals with medical conditions

This Bill requires businesses that are open to the general public for the sale of goods to share their employee restrooms with individuals who have medical conditions such as Crohn's disease, ulcerative colitis, irritable bowel syndrome, or any other medical condition that requires immediate access to a toilet facility.

Notable industry-specific laws

AB 1601: Cal/WARN layoff requirements now apply to call center employers

As with other federal statutes, California has its own version of the federal Worker Adjustment and Retraining Notification (WARN) Act, dubbed Cal/WARN. Cal/WARN applies to industrial and commercial facilities employing 75 or more employees. It mandates that employers of such facilities provide advance written notice of mass layoffs, relocations or terminations of operations. Effective in 2023, Cal/WARN will also apply to call center employers.

The bill defines a "call center" as "a facility or other operation where employees, as their primary function, receive telephone calls or other electronic communication for the purpose of providing customer service or other related functions." It defines "relocation of a call center" as "when the employer intends to move its call center, or one or more facilities or operating units within a call center comprising at least 30 percent of the call center's or operating unit's total volume when measured against the average call volume for the previous 12 months, or substantially similar operations to a foreign country."

The Employment Development Department (EDD) will publish a list of call center employers that provide notice under Cal/WARN. If an employer is on the EDD's list or fails to provide the requisite notice, it will be ineligible for state grants, loans and tax credits.

AB 1788: Civil penalties for hotels with knowledge of sex trafficking

Under AB 1788, hotels will be subject to civil penalties if a supervisory employee knew or acted with reckless disregard of sex trafficking activity within the hotel and failed to inform law enforcement, the National Human Trafficking Hotline, or another appropriate victim service organization. Penalties may also be imposed if any hotel employee was acting within the scope of their employment and knowingly benefited from participating in a venture that the employee knew, or acted in reckless disregard of the activity constituting sex trafficking.

For violations of this new law, a city, county, or city and county attorney may file a lawsuit against the hotel for equitable relief, as well as civil penalties ranging between $1,000 to $10,000 per violation. AB 1788 has a five-year statute of limitations, from the date of the violation or the date a minor victim turns 18 years old.

AB 2183: Voting changes create an easier path for farm workers to unionize

The Agricultural Labor Relations Voting Choice Act (AB 2183) makes it easier for farm workers to organize into unions by allowing workers to vote by mail or ballot card drop-off, also known as a "card check." Previously, such union elections required in-person voting. Gov. Newsom had originally declined to sign AB 2183, but did an about-face after President Joseph Biden announced his strong support for the bill. The governor conditioned his signature on an agreement with the United Farm Workers president and the California Labor Federation to pass clarifying language in next year's legislative session.

AB 1102 was not passed: Employers will have significant new privacy obligations under the CPRA

Last but far from least, California employers will soon be required to comply with the privacy obligations set forth in the California Privacy Rights and Enforcement Act (CPRA). The CPRA takes effect Jan. 1, 2023, and amends the California Consumer Privacy Act (CCPA). Critically, the state legislative session ended without the passage of AB 1102, a bill that would have extended the employer exemptions under the CCPA and prevented them from expiring at the end of the year. Therefore, employers must come into compliance with the CPRA's obligations regarding employee/applicant data, including specific notifications about personal information that is collected and disclosed, and honoring employees' and applicants' rights concerning the collection, correction, deletion, portability, and disclosure of their personal data. The CPRA will be enforced by a newly established California Privacy Protection Agency. Employers should consult with counsel to ensure proper compliance with these new and significant privacy obligations.

Conclusion

The multitude of new California laws going into effect in January 2023 and beyond will reshape the state's employment law landscape. It is wise for employers to stay on top of these developments and collaborate with legal counsel to update workplace policies and procedures.