Lara H. Shortz
Partner, Michelman & Robinson LLP
Phone: (310) 299-5500
Email: lshortz@mrllp.com
Lara advises management regarding employment and labor law issues, including state and federal employment acts, hiring, firing, discrimination, harassment and wage and hour compliance. Lara also handles executive employment contract disputes and conducts workplace training, investigations and compliance as well.
Derrick Fong-Stempel
Associate, Michelman & Robinson, LLP
Phone: (310) 299-5500
Email: dfong-stempel@mrllp.com
Derrick focuses his practice on counseling and litigating on behalf of employers in cases involving discrimination, harassment, wrongful termination, reduction in workforce, hiring, wage and hour issues, misclassification, overtime and meal/rest breaks.
A bevy of new employment-related laws are set to come online in 2022. What follows is an overview of the most significant legislation that goes into effect in the New Year.
ARBITRATION FEES
Another hurdle for employers seeking arbitration
Senate Bill 762 prevents employers from causing delays in arbitration proceedings by failing to pay the fees associated with arbitration in a timely manner or by asking for payment extensions. The new law also provides that any time specified in a contract of adhesion for the performance of an act required to be performed shall be reasonable, which suggests that the party drafting an arbitration agreement cannot provide for an unreasonably long period of time to pay arbitration fees.
Effective January 1, SB 762 requires arbitration providers to "immediately provide an invoice" for arbitration initiation and hearing fees once the requirements necessary to initiate an arbitration have been met. Payment in full would be due from the given employer immediately and not later than 30 days after the invoice is issued unless the arbitration agreement in question provides a reasonable number of days to pay any required fees or costs.
COVID-19
Employers' notification, benefits and disinfecting requirements after COVID-19 exposure have been clarified
Assembly Bill 654, which is now in effect, clarifies the steps employers must take after learning of a notice of potential workplace exposure to COVID-19. The new law requires employers to notify employees who were "on the premises at the same worksite as the qualifying individual within the infectious period" (as opposed to employees who may have been exposed to the virus). Further, AB 654 revises the time frame in which employers must give notice of COVID-19 outbreaks to local public health agencies from "within 48 hours" to "within 48 hours or one business day, whichever is later." Also, among other things, the bill exempts certain licensed health care facilities from reporting requirements in the wake of an outbreak since those facilities are already bound by other legal reporting obligations.
LEAVE LAWS
The scope of family care and medical leave rights has been expanded
AB 1033 adds parents-in-law to the definition of a "parent" for purposes of family care and medical leave under the California Family Rights Act and allows employees to take leave to care for "designated persons." Of note, designated persons can be identified at the time of leave and a new person can be so designated every 12 months. As such, AB 1033 expands the scope of CFRA leave. It also significantly modifies the notice provisions of the small employer family leave mediation pilot program applicable to employers with between five and 19 employees. The new law requires that employees contact the Department of Fair Employment and Housing prior to filing civil actions for alleged CFRA violations.
NONDISCLOSURE AND CONFIDENTIAL SETTLEMENT AGREEMENTS
Prohibition of nondisclosure provisions in settlement agreements is expanded
SB 331, the "Silenced No More Act," nullifies and serves to void provisions within any settlement or severance agreement that prevent or restrict an employee from disclosing factual information regarding workplace harassment, discrimination or retaliation. The new law, which takes effect on January 1, expands upon prior disclosure prohibitions that were limited to facts regarding sexual assault, sexual harassment, harassment or discrimination based on sex. As otherwise stated, acts of workplace harassment or discrimination not based on sex are now contemplated under the amended statute. However, the restrictions do not apply to negotiated settlements stemming from lawsuits, administrative actions or an employer's internal complaint process.
Consistent with existing law, SB 331 allows for provisions prohibiting the disclosure of settlement amounts, facts that could reveal a claimant's identity, and confidential employer information. Likewise, the law prohibits an employer from requiring an employee to sign a nondisparagement agreement or other documents in exchange for a raise or bonus, or as a condition of employment or continued employment. Translation: An agreement cannot be forced upon an employee that serves to deny his or her right to disclose unlawful acts in the workplace.
Lastly, SB 331 requires that when separation agreements are offered to current or former employees, they must be notified of their right to consult an attorney and be given at least five business days to do so.
RECORDKEEPING
Employers will need to retain personnel records for longer periods of time
SB 807 extends current personnel records retention requirements from three to four years. And when litigation has been filed, employers must retain these records until the applicable statute of limitations has run or through the conclusion of the litigation, whichever occurs later. The new law, which becomes effective on January 1, also makes several changes to the filing and tolling deadlines for bringing claims for certain civil rights violations, including claims on behalf of a class.
WAGE & HOUR
Intentional wage theft will be punishable as grand theft
Pursuant to AB 1003, any employer found to have engaged in the intentional theft of wages, gratuities, benefits or other compensation, in an amount greater than $950 from any one employee, or $2,350 in the aggregate from two or more employees, in any consecutive 12-month period may be convicted of grand theft. For purposes of this law, independent contractors are included within the meaning of employee, and those hiring them to qualify as employers.
Food delivery and facility personnel will keep all of their tips
Among other things, AB 286 prohibits food delivery platforms from retaining any portion of tips paid to those delivering food and beverages, whether those tips are for the delivery driver or for the food facility.
Warehouse distribution centers will be required to disclose quotas to nonexempt employees
Effective January 1, AB 701 requires warehouse distribution centers to provide to each nonexempt employee, upon hire, with a written description of each quota to which the employee is subject to, including the quantified number of tasks to be performed or materials to be produced or handled, within the defined time period, and any potential adverse employment action that could result from failure to meet the quota. Pursuant to the new law, an employee is not required to meet a quota that prevents compliance with meal or rest periods or occupational health and safety laws. AB 701, which will be enforced by the Labor Commissioner, permits current or former employees to bring actions for injunctive relief to obtain compliance with its requirements.
Brand guarantors and garment manufacturers prevented from paying piece-rates, required to maintain records for four years, and may be held jointly and severally liable for unpaid wages to contractors
SB 62, titled the "Garment Worker Protection Act," mandates hourly wages for garment workers; prohibits the practice of paying workers per garment (often resulting in less than $3 per hour); penalizes manufacturers and brands for wage theft and illegal pay practices; and requires garment manufacturers and brand guarantors to maintain all work-related documentation (read: contracts, invoices, purchase orders and the like) for four years.
Employers will be permitted to distribute required employment-related posters via email
SB 657 authorizes employers to send as email attachments to employees information they are required to physically post at the worksite. The new law does not absolve an employer of its obligation to physically display required postings under other state or federal laws.
WORKPLACE SAFETY
Cal/OSHA's can issue citations for two new categories of health and safety violations
SB 606 significantly expands the enforcement power of Cal/OSHA for with two new violation categories: "enterprise-wide" violations and "egregious" violations (where an employer has willfully and egregiously violated an occupational safety or health standard, order, special order or regulation based on at least one of seven factors defined in the statute). The new law creates a rebuttable presumption that an employer with multiple worksites has committed an enterprise-wide violation if it has a noncompliant written policy or procedure or evidences a pattern or practice of the same violations involving multiple worksites. Enterprise-wide citations will carry the same penalties as repeated or willful citations, up to $134,334 per violation.
In addition, SB 606 gives Cal/OSHA the authority to issue a subpoena during the course of an investigation if an employer fails to "promptly" provide Cal/OSHA requested information.
EMPLOYER ACTION ITEMS
As 2022 fast approaches, employers can take the following steps toward compliance with these new laws:
1. Update employee handbooks to reflect statutory changes.
2. Review new hire packets to ensure employees are receiving all required documentation.
3. Review base salaries for all exempt employees to ensure they meet the salary requirements for exempt status and confirm that nonexempt employees are being paid at least the state minimum wage.
4. Update severance and arbitration agreements to ensure they are consistent with the "Silenced No More Act" and SB 762, respectively.
5. Prepare to meet the March 31 deadline for California's payroll reporting requirement.