Seyfarth Synopsis: Every year California enacts a host of new laws that mean even the most diligent employers need to give their handbooks and policies a review and make sure they are up to date with the latest developments. Seyfarth has a few tips for making sure your handbook in the New Year stays compliant all year long (or at least until California complicates things again!).

It’s late-December, so as you make your New Year’s resolutions for 2023, updating your company’s handbook to comply with new California laws should be at the top of your list!

Although there’s no right or wrong time to do a handbook and policy update, we recommend doing them annually, as California law continually changes. Close to the start of a new year is a great time to do a check-in, because new laws typically become effective on January 1. So let’s get you rockin’ into New Year’s Eve with a game plan for your updates for 2023!

As we addressed in our legislative update this past fall in detail, here are the new laws coming into effect for 2023 (unless otherwise noted) requiring updates to employee handbooks:

Changes to CFRA, Leave, and Sick Policies to Include A “Designated Person”

The California Family Rights Act (“CFRA”) and the California Paid Sick Leave Law (“PSL”) will now cover a “designated person” for whom an employee may take leave, in addition to the family members covered within their scope under AB 1041.

As we blogged about in detail previously, a designated person under the CFRA is defined as any individual related by blood or whose association with the employee is the equivalent of a family relationship, and includes domestic partners. The definition of a designated person under the new PSL provisions is different and broader—it can be any person identified by the employee. An employee can identify their designated person at the time they request leave or request to use PSL.

Under both the CFRA and PSL revisions, an employer may limit an employee to naming one designated person per 12-month period. And, under the CFRA, an employer may require the employee substitute any of the employee’s accrued vacation leave or other accrued time off during a leave period, or any other paid or unpaid time off negotiated with the employer.

Employers should make sure their leave policies, sick time policies, associated leave request forms, and handbooks are updated accordingly.

Bereavement Leave Policy Updates

Starting in 2023, the CFRA requires an employer to allow employees to take up to 5 days of bereavement leave upon the death of a family member, provided the employee has at least 30 days of active service. Family member is defined as spouse, child, parent, sibling, grandparent, grandchild, domestic partner, or parent-in-law—more narrowly than the definitions used for CFRA leave generally or PSL, as noted above.

The days of bereavement leave do not be taken consecutively, but an employer can require that the leave be completed within three months of the death of the family member. If the employer does not have a paid bereavement policy, the leave may be unpaid, except that an employee must be allowed to use vacation, personal leave, accrued and available sick leave, or compensatory time off that is otherwise available to the employee. The law does not have any limit on how many times it may be utilized in one year, in the event the employee has multiple covered family members pass away.

The law allows the employer to require documentation of the death of the family member, which can be a death certificate or a published obituary (among other broad types of verification), and prohibits retaliation for requesting bereavement leave.

Employers should revise their bereavement leave policies (if they have written policies) and handbooks to comply with these changes, especially to ensure they are offering at least the minimum number of required days.

Changes to Attendance and Mobile Device Use Policies Where There Are Emergency Conditions

Under SB 1044, in the event of an emergency condition, employers may not take or threaten adverse action against an employee for refusing to report or leaving a workplace because they feel unsafe. In addition, an employee may not be prevented from using their mobile devices for emergency purposes.

It’s important to note that a health pandemic is not considered an “emergency condition,” under this new law. It does include: (1) conditions of disaster or extreme peril to the safety of persons or property at the workplace caused by natural forces or a criminal act, or (2) an order to evacuate a workplace, a worker’s home, or the school of a worker’s child due to natural disaster or a criminal act. The law was designed essentially to allow for employee protections related to wildfires and school shootings, though it is drafted much more broadly than that.

This law requires employees, where feasible, to notify the employer of the emergency condition. The law does not apply to first responders, disaster service workers, employees on military bases, and employees of residential care facilities, among others.

The prohibition on taking or threatening adverse action against an employee for refusing to report to or leave a workplace because they feel unsafe may require employers to update their attendance policies, potentially making modifications related to discipline for employees who call out or leave a shift early. Also, the prohibition on preventing an employee from accessing their mobile device for emergency purposes may require employers to revise their mobile device policy, particularly in certain industries that may prevent employees from accessing mobile devices at all times during an ongoing shift.

Reproductive Health Now Should Be Included In Anti-Discrimination Policies

The Contraceptive Equity Act of 2022 amends the Fair Employment & Housing Act (“FEHA”) to include reproductive health decisionmaking as a protected class, making it unlawful to harass, discriminate, or retaliate against individuals on that basis. Reproductive health decisionmaking, includes, but is not limited to, an individual’s decision to use or access a particular drug, device, product, or medical service for reproductive health. The law specifically calls out usage of birth control, contraceptives, and voluntary sterilization services as needing to be protected choices.

Employers should review their handbooks and policies, and update their anti-harassment, anti-discrimination, and anti-retaliation prevention policies to reflect the new protected class “reproductive health decisionmaking” under the FEHA. Employers should also consider updating training materials in 2023 to reflect the new protected class and include interactive examples, as they currently do with other protected categories.

Minimum Wage Increase Means Double Check Employee Wages and Exempt Employee Status

The California minimum wage will increase to $15.50 per hour for all employers in the new year.

This increase in the minimum wage affects means you may have non-exempt employees that need raises, and it may create upstream affects that your company will want to consider giving raises to lower level managers as well.

Also significant for employers, with the rise in minimum wage, the minimum annual salary requirement for overtime exempt employees also goes up. California law requires that employees subject to the administrative, professional, or executive exemptions receive a salary that is at least two times the state minimum wage. Because of the increase to the state minimum wage, effective January 1, 2023, the minimum annual salary for employees under these exemptions will also increase to $64,480.

Note that select California cities in the greater Bay Area, Silicon Valley, San Diego, West Hollywood, and others will raise the minimum wage for non-exempt employees working within city limits. Non-exempt employees working within one of these cities must be paid the local minimum wage when greater than the California state minimum wage.

Employers should check to make sure that they have up-to-date minimum wage posters in their breakrooms, and should check with payroll to make sure that all employees are making the correct minimum wage in the new year, and that exempt employees are making at least the statutory minimum.

Don’t Forget About San Francisco’s Public Health Emergency Leave Ordinance

This year, San Francisco voters passed Proposition G, a new Public Health Emergency Leave Ordinance (PHELO), which became operative on October 1, 2022. As we previously blogged about in detail, San Francisco employers with 100 or more employees worldwide, must provide up to 80 hours of paid Public Health Emergency Leave to each employee who performs work in San Francisco. This is in addition to any paid time off, including paid sick leave under the San Francisco Paid Sick Leave Ordinance.

Any covered San Francisco employers who have not already updated their leave policies, should revise accordingly to comply with this Ordinance.

…And the West Hollywood Paid Time Off Ordinance

As discussed more in depth in our prior blog, on November 15, 2021, West Hollywood enacted an ordinance requiring employers to allow accrual of up to 96 paid hours per year for sick leave, vacation, or personal necessity to full-time employees, and instituting a number of other requirements. On May 16, 2022, West Hollywood amended the Ordinance, and recently released regulations and administrative materials, such as required posters regarding the new minimum wage and the time off components.

West Hollywood employers who have not already updated their policies accordingly, take note!

Workplace Solutions

Just because New Year’s is famous for dropping a big ball doesn’t mean your company has to! Before you start singing “Auld Lang Syne,” reach out to Seyfarth’s Handbooks and Policy Development Group to begin your new year off right and ensure your handbook and policies are in compliance with California law.

Edited by Coby Turner

Seyfarth Synopsis: As we blogged about previously, California passed a landmark pay transparency law in September 2022. As promised, the Labor Commissioner’s office has issued FAQs addressing big employer questions regarding who is covered, information required to be disclosed, and details on remote job postings.

On December 27, 2022, the California Labor Commissioner’s office released eagerly anticipated Frequently Asked Questions (“FAQs”) on the state’s new pay scale disclosure requirements under the Equal Pay Act, which are effective on January 1, 2023.

This guidance clarifies some of the major outstanding questions on compliance with the requirements introduced in SB 1162.

The FAQs clarify which employers will be subject to the pay disclosure requirements and the content of the mandatory disclosures. Of note, the FAQs do not clarify whether the requirements only apply to postings made on or after January 1, 2023, or if it will apply to all postings that remain active as of January 1, 2023.

Who Must Comply?

Under Labor Code 432.3, “an employer with 15 or more employees must include the pay scale for a position in any job posting.” The FAQs explain that the Labor Commissioner will count employees using the same methodology applied for Supplemental Paid Sick Leave as explained in a previous FAQ (which in turn leans on the FAQs related to California’s state minimum wage requirements)—i.e. using the definition from Labor Code 1182.12, the disclosure requirements apply if an employer has at least one employee located in California, so long as it employs “directly or indirectly, or through an agent or any other person” 15 or more people.

Does This Apply to Remote Postings?

If a position can be filled in California, either remotely or in person, then the pay scale must be included in job postings.

What Must Be Disclosed?

Pay Scale Definition

The FAQs confirm that a pay scale is limited to the “salary or hourly wage range the employer reasonably expects to pay for a position.” A set hourly rate or set piece rate may be included in place of a pay scale if an employer “intends to pay a set hourly amount or a set piece rate amount, and not a pay range.”

Bonuses, tips, and other benefits are not required to be included in the pay scale. Employers may voluntarily provide information on “compensation or tangible benefits provided in addition to a salary or hourly wage.” However, employers should take note that the Labor Commissioner reminds employers that “other forms of compensation may be considered for equal pay purposes.”

Mandatory Disclosure of Piece Rate and Commission Compensation

In a relatively unique Cal-peculiarity, where a person’s hourly or salary wages is based on a piece rate or commission, then the employer must include the piece rate or commission range the employer reasonably expects to pay for the position.

How Can Employers Make Disclosures?

In a key departure from some of the other jurisdictions that have enacted pay scale disclosure requirements, employers cannot link to the salary range in an electronic posting or include a QR code in a paper posting. The pay scale must be included on the posting itself.

Reminder of New Record Retention Requirement

In addition to the new pay scale disclosure requirements, an employer must keep records of a job title and wage rate history for each employee for the duration of the employment plus three years after the end of the employment. These records must be open to inspection by the Labor Commissioner, which the Labor Commissioner will then use to determine whether there is a pattern of wage discrepancy.

What Should You Do to Prepare?

Employers should ensure that all job postings posted on or after January 1, 2023, contain the required pay scale information. In particular, employers who previously intended to provide links to the pay scale should instead include the pay scale directly in the job postings.

It is imperative to carefully review postings before they are created, as employers who fail to comply can be subject to penalties ranging from $100 and no more than $10,000 per violation.

Workplace Solutions

Seyfarth’s Pay Equity Group is available assist you in finalizing your pay scale disclosures and can provide guidance on any related pay transparency questions. There is also no time like the present to engage your teams in pay reviews to ensure compliance with pay transparency laws in California, nationwide, and around the globe, so please don’t hesitate to reach out to your favorite Seyfarth lawyer to see what we can do to help.

Seyfarth Synopsis: On Thursday, December 15, 2022, the Occupational Safety and Health Standards Board (“OSHSB”) approved the long-proposed 2-year “permanent” COVID-19 standard. The new standard took effect on February 3, 2023, after final approval from the Office of Administrative Law, and replaced the current Cal/OSHA COVID-19 Emergency Temporary Standard (“ETS”).

It’s The Most Wonderful Time Of The Year

Among other things, the holiday season is a time when generosity is on full display. Across the world, families and friends exchange gifts and engage in other gestures of goodwill. Today, Cal/OSHA gifted California employees a new 2-year “permanent” COVID-19 standard just in time for the holidays.

The new standard will ease some of the regulatory burdens employers contended with under the ETS set to expire at the end of 2022, which we previously covered in detail. Nonetheless, the idea of a permanent COVID-19 standard will, for most employers, be even more undesirable than a lump of coal.

It’s Beginning To Look A Lot Like…What We Expected

We blogged about the proposed permanent standard when it was first posted, with the caveat that the OSHSB could make further changes. Although some administrative adjustments were made, the substance of the new permanent standard has remained the same with no last minute additions or revisions.

As a refresher, here are some major changes from the ETS that every California employer should be aware of.

  • Definition changes. The approved permanent standard makes changes to many of the definitions we have seen in the ETS. Some of the more significant changes include:
    • “Close Contact” – Instead of a single definition for close contact, the permanent standard distinguishes between two scenarios based on workplace size. (Note that this new definition already applies in workplaces covered by the ETS because it was changed by CDPH Order on October 13, 2022).
      • Indoor spaces of 400,000 cubic feet or less: a close contact results from sharing the same indoor space for 15 or more cumulative minutes within 24 hours during the infectious period. Here, six feet of distance does not matter.
      • Indoor spaces of greater than 400,000 cubic feet: a close contact results from being within six feet of a COVID case for a cumulative total of 15 minutes or more within 24 hours during the infectious period.
      • Importantly, each room with floor-to-ceiling walls makes up a distinct indoor space for purposes of this rule. Employees wearing a respirator during this time are not close contacts.
    • “Exposed Group” – The permanent standard makes a few changes here. Most importantly, places where individuals momentarily pass through without congregating, regardless of whether they are wearing a face covering, are not considered for the purpose of determining if a group has been exposed.
      • Under the current ETS, everyone in the space had to wear a face covering, even with respect to momentary exposures, or else they would be considered part of an exposed group.
    • “Infectious Period” – Under the permanent standard, the definition of infectious period is less stringent and allows for a shorter time frame.
      • For symptomatic cases, the infectious period may now end five days (down from 10 days) after the arrival of symptoms if the individual tests negative on that day and has not had a fever for over 24 hours without medication.
      • For asymptomatic cases, the infectious period may also end five days after a positive test if a negative test is produced on the fifth day.
    • “Returned Case” – Instead of a 90-day period following the initial onset of symptoms or positive test, the permanent rules changes this to 30 days, after which time someone who returned to work following a COVID-19 related absence is no longer considered a returned case.
      • This shortened time period means that employers may be required to provide COVID-19 testing to a larger number of employees, as returned cases under the ETS are exempt from the requirement.
  • Exclusion pay. One of the most notable differences between the current ETS and the newly-approved permanent standard is the absence of exclusion pay.
    • Currently, employers must continue and maintain employees’ earnings, seniority, rights, and benefits if they have been excluded from the workplace due to COVID-19 exposure or illness contracted at work. Employers have to provide exclusion pay under the ETS before requiring employees to exhaust other forms of potential paid leave, like Supplemental Paid Sick Leave.
    • The permanent standard eliminates this provision. Instead, employers must only provide information to confirmed cases and close contacts about COVID-19 benefits they may be entitled to under local and federal law.
  • Notice requirements. The notice requirements have also been somewhat streamlined.
    • The ETS requires employers to provide written notice to all employees present at a worksite during the infectious period of a COVID-19 case within one business day of when they learn of the case. Notice must also be sent to independent contractors and other employers whose employees were on the premises during this period.
    • The permanent standard includes similar notice requirements, but changes the time frame for notice to “as soon as possible,” so long as the employer is able to meet any potential exclusion requirements. It also defers to Labor Code 6409.6 for the content and form of notice, which means employers would be allowed to do posting instead of providing notices in writing, in light of recent amendments mentioned above.
  • Reporting and recordkeeping. Reporting and recordkeeping requirements have changed to reflect increasing priorities on cases and large outbreaks, rather than exposures or isolated cases.
    • Employers will no longer have to report information about workplace COVID-19 cases and outbreaks to their local health department. (Though employers need to be aware that local health departments may still promulgate their own requirements on reporting.)
    • Additionally, while employers must keep a record of COVID-19 cases for two years, they no longer have to keep records of close contacts.
    • The requirement that employers document the steps taken to implement a separate COVID-19 Prevention Program has also dropped away, meaning employers can generally rely on their standard Injury and Illness Prevention Program (IIPP), as long as the IIPP adequately addresses employee health and safety policies and procedures related to COVID-19.
    • The non-emergency standard adds that in a major outbreak setting, employers must report the outbreak to Cal/OSHA. The proposed rule does not specify a time frame within which the report must be made.
  • Face coverings. In many ways, the rules remain the same. There are, however, some important distinctions:
    • Under both the current ETS and soon-to-be-in-effect standards, employees who are exempted from a mandatory face covering requirement due to medical, disability, or mental health reasons must wear “an effective nonrestrictive alternative” if possible. But, if a face covering is not possible, the permanent standard no longer mandates any sort of testing for these employees.
    • Employers are required to ensure employees wear face coverings when required by a CDPH regulation or order.
  • Outbreaks. Currently, the ETS outbreak rules come in play once three or more COVID-19 cases in an exposed group visit a work site during their infectious period within a 14-day window, and last until there are no new cases detected in a 14-day period. The permanent standard contains various key changes to these rules. Most notably:
    • The provisions concerning outbreaks no longer apply once there have been one or fewer cases detected in an exposed group within a 14-day period. This change may slightly decrease the amount of time that an employer has to follow the more stringent procedures in the event of an outbreak.
    • Currently, during an outbreak employers must evaluate whether HEPA or other filtration units would reduce the risk of transmission. The permanent standard will require employers to utilize HEPA units upon an outbreak whenever ventilation is inadequate to reduce transmission.
    • Provisions on major outbreaks still apply when there are more than 20 cases detected in a 14-day period, and employers need to comply with those provisions as long as there is more than one case detected in the exposed group within a 14 day period.
    • Finally, and very importantly, during a major outbreak, employers will be required to report the outbreak to the Division. This is not a requirement under the current emergency standard.
  • Return to work criteria. The criteria for when a COVID-19 case may return to work is largely the same, but under the non-emergency rule, there is no difference in the standard for those whose symptoms, other than a fever, remain. Thus, under the permanent standard, the continued presence of symptoms is irrelevant if on the fifth day a negative test is produced, unless one of the symptoms is a fever.
  • Ventilation. Currently, employers are required to evaluate how existing ventilation systems may be modified to maximize ventilation with outdoor air. The permanent rule eliminates this language.
    • Instead, the non-emergency standard obligates employers to “develop, implement, and maintain” a prevention plan that incorporates at least one of the following:
      • Maximizing outdoor air when ambient conditions do not pose a hazard.
      • Filtering circulated air through a MERV-13 filter or as much filtration as the existing ventilation system will permit.
      • Using HEPA filtration units in indoor spaces when ventilation is inadequate.
  • Employer-provided housing. Unlike the ETS, the permanent standard will not require employers to prioritize housing assignments in a particular order. Instead, it merely directs employers to consider distinct cohorts in housing assignments.
  • Employer-provided transportation. Many of the requirements of the ETS pertaining to transportation have been dropped. In their place, the new standard instructs employers to comply with the general provisions applicable to workplaces.

Do You Hear What I Hear?

Employers should be aware that, even though exclusion pay was omitted from the non-emergency standard, Cal/OSHA is apparently intent on including it in a likely upcoming general infectious diseases standard. The standard is currently being drafted internally, and it was confirmed in the Board meeting on December 15, 2022 that the current draft includes exclusion pay for employees kept from the workplace due to COVID-19 infection.

A formal motion to include exclusion pay in the general standard will be made at the next Board meeting.

For Auld Lang Syne, Employers Update Your Policies For 2023

Update: The permanent COVID-19 standard went into effect on February 3, 2023, and it will remain in place for two years, until 2025, with recordkeeping requirements in effect through February 3, 2026.

Workplace Solutions

Although the permanent standard may be enough to turn one into a Grinch, employers should be prepared to continue complying with California COVID-19 laws for at least a few more years. Fortunately, Seyfarth can help keep things merry. Your favorite Seyfarth attorneys are here to help make sense of things, and will even do so with good cheer.

Seyfarth Synopsis: The holidays aren’t the only thing around the corner. The City of Los Angeles’ proposed Fair Work Week Ordinance is poised to place new onerous scheduling requirements on retailers. The Los Angeles City Council voted to pass the ordinance on November 22, 2022, and it is slated to go into effect in April 2023. Among other things, these requirements will require employers to provide schedules two weeks in advance, and penalize employers who are unable to adhere to provided schedules.

The Backdrop

While the California legislature has considered predictive scheduling laws, to date, these laws have only passed at the local level. Los Angeles is about to join cities such as San Francisco, San Jose, and Emeryville by enacting a Fair Work Week Ordinance. (Berkeley has also introduced a similar ordinance, but it has not yet passed.)

Impacted Employers

The proposed ordinance defines an employer as any retail business with over 300 employees globally. Notably, individuals employed through staffing agencies, and employees of certain subsidiaries and franchises count towards the 300 person total.

To be considered an employer under the ordinance, entities must also identify as a retail business in the North American Industry Classification System (NAICS) within retail trade categories and subcategories 44 through 45. (These categories include establishments primarily engaged in retailing merchandise and rendering services incidental to the sale of merchandise.)

Impacted Employees

Similar to other City ordinances, an employee is anyone working in the City of Los Angeles at least two hours or more per week for an employer and who is entitled to be paid at least minimum wage under Section 1197 of the California Labor Code and the California Industrial Welfare Commission’s published wage orders.

Employers Must Provide Estimates & Advance Notice

The ordinance will require employers to provide estimates and advance notice of schedules as follows:

  • Good Faith Scheduling Estimate & Notice: Employers must provide a good faith estimate of work schedules before hire, as well as a notice of rights under the ordinance.
  • 10 Day Notice: Employers must provide a good faith estimate of a schedule within ten days of an employee’s request. If there is a substantial deviation from the estimate, the employer must have a documented business reason for the change.
  • Right To Request Changes: Employees have the right to request a preference for certain hours, times, or locations. Employers may accept or deny requests, provided that they notify the employee in writing of the reason for any denial.
  • Advance Notice: Employers must provide work schedules to their employees at least 14 days in advance by either posting or transmitting them by electronic means (or another means reasonably calculated to provide notice). Employers shall provide written notice of any employer initiated changes that occur after the advance notice period.
  • Right to Decline Schedule Change: If an employer changes the schedule, employees can decline any hours not included in the original schedule. And, any consent to a schedule change must be in writing.

Hit Pause Before Hiring

Before hiring new employees (or bringing on contractors or temps), an employer must offer work to current qualified employees if the additional work would not result in overtime. Additional hours offered to current qualified employees must be conspicuously posted for at least 72 hours before hiring a new employee (unless all employees confirm they are not interested in the new hours, in which case, the employer can fulfill its staffing needs).

Employees who accept offers under these circumstances are not entitled to predictability pay (described below) if the additional hours result in schedule changes.

Pay To Change

“Predictability pay” will be required when a schedule is changed under certain circumstances. Employers will owe one hour of pay at the regular rate for changes in time, date, or location that do not result in loss of employee time, or adds more than 15 minutes to an employee schedule. Employers will also owe half the employee’s regular rate of pay for time not worked if the employer reduces the scheduled time by 15 minutes or more.

Predictability pay is not required for:

  1. Employee-requested schedule changes;
  2. Employees voluntarily accepting schedule changes due to another employee’s absence;
  3. Hours changed as a result of the employee’s violation of law or the employer’s policies;
  4. The employer’s operations are compromised due to force majeure; or
  5. Where extra hours would result in overtime payments.

Employers Must Find Coverage

Employers will not be allowed to compel employees to find coverage if they miss a scheduled shift.

Requirements For Rest Between Shifts

Employees cannot be scheduled to work on shifts that are less than 10 hours apart without written consent—e.g., an employee who is scheduled to close one day and open the next one. If an employee consents, they must receive 1.5 times their regular hourly rate for the second shift.

Records Retention Requirements

Covered employers must keep records for both current and former employees for a three-year period, including:

  • Work schedules for all employees;
  • Copies of written offers to employees for additional work hours and written responses from employees;
  • Written correspondence between the employer and employees about work schedule changes like requests, approvals, and denials;
  • Good faith estimates of hours provided to new and existing employees; and
  • Any other records that may be required to demonstrate compliance.

Posting Requirements

Every employer must post the City’s forthcoming notice to inform employees of these rights. Posters must be in English, Spanish, Chinese (Cantonese and Mandarin), Hindi, Vietnamese, Tagalog, Korean, Japanese, Thai, Armenian, Russian, Farsi, and any other language spoken by at least five percent of employees at the worksite.

Penalties Add Up

Employees will be required to give employers written notice of any alleged violations and an opportunity to cure before filing a claim with the City. Employers will have 15 days to cure alleged violations.

The City can recover up to $500 per violation per each employee. Both employees and the City will also be entitled to administrative penalties that accrue on a daily basis. Employees will be able to enforce the ordinance through a private right of action and attorneys’ fees will be awarded to prevailing plaintiffs. (However, an entity enforcing the ordinance on behalf of the public shall only be entitled to equitable, injunctive and/or restitutionary relief, and reasonable attorneys’ fees.)

Employers are prohibited from discharging or retaliating against an employee in any way for participating in proceedings or seeking to enforce their rights under the Ordinance.

Looking Ahead

The City Council considered the Ordinance on November 22, 2022 and approved it unanimously, 10-0. It is now being held over for one week for a second reading scheduled for November 29, 2022. The Ordinance’s proposed effective date is April 1, 2023, but violations during the first 180 days of the effective date shall be subject to a grace period.

The City may promulgate rules and regulations (which will likely be issued closer to the effective date).

Workplace Solutions

Employers doing business in the City of Los Angeles need to closely examine their scheduling practices and records retention procedures to ensure they are ready to be in compliance with the new law, as well as make sure their payroll departments are aware of the potential need to handle predictability pay. As these laws continue to creep up in cities and counties around the country, Seyfarth will keep you informed. If you have questions regarding compliance, please reach out to the authors or your favorite Seyfarth attorney.

Edited by Sara Fowler and Coby Turner

Seyfarth Synopsis: Two big changes are on the horizon for California employers:
(1) changes to the COVID-19 general exposure notification requirements and (2) a proposed “permanent” Cal/OSHA COVID-19 standard to take effect January 1, 2023-2025.

The fall season signals change between the warmth and sun of summer and the cold and wet of winter. This year, fall also includes upcoming changes to the regulatory landscape in California as it pertains to COVID-19. Specifically, the passage of AB 2693 in late September and a recent round of edits to a proposed permanent Cal/OSHA COVID-19 standard have given employers new things to consider. Both of these new provisions are set to be effective January 1, 2023.

General Exposure Notice Changes

Methods of Notification

As California employers are well aware, legislation enacted early in the pandemic requires that written general exposure notification be provided to employees who were at the same worksite at the same time as a person with COVID-19, advising them that they “may have been exposed” to COVID-19, providing information about available benefits, and providing information the employer’s cleaning and disinfection plan. That legislation was set to expire at the end of 2022. However Governor Newsom just signed a new bill—AB 2693—which extends the general exposure notification requirement until January 1, 2024.

But there’s good news too: AB 2693 significantly reduces the burden on employers by allowing an option for the notice of potential exposure to be posted at the worksite, or on an employee portal if other workplace notices are posted on the portal. Like the notice required under the current legislation, it must be posted within one business day from when the employer learns of the COVID-19 case, and remain posted for at least 15 calendar days.

Employers still have the option to provide written notice to covered workers, and the employers of subcontracted workers, if they prefer. But, employers must still provide a written notice to the exclusive representative, if any, of the COVID-19 case(s) and any employees who had close contact.

Records of the written notices provided and a log of the dates of the notices posted must be maintained for 3 years.

Content of the Notice

The information required in the notice is also changing. Now, employers do not need to notify employees or other workers on site that “they may have been exposed.”

Rather, the new version of the notice has been streamlined, and now requires the following be included:

  1. The dates on which an employee, or employee of a subcontracted employer, with a confirmed case of COVID-19 was on the worksite premises within the infectious period.
  2. The location of the exposures, including the department, floor, building, or other area, but the location does not need to be so specific that it would allow individual workers to be identified.
  3. Instead of providing detailed information on the specifics, employers now only need to provide contact information for where employees may receive information regarding COVID-19-related benefits they may be entitled under applicable federal, state, or local laws, as well as antiretaliation and antidiscrimination protections of the employee.
  4. As a reminder, these benefits may include categories such as workers’ compensation, COVID-19-related local or emergency leave, company sick leave, state-mandated leave, recently extended COVID supplemental sick leave (which we recently blogged about here), or negotiated leave provisions.
  5. As a best practice, companies should ensure that their HR, Safety, or designated management personnel are prepared to provide this information upon request and are familiar with the local options for both paid and unpaid leave.
  6. Likewise, employers now only need provide contact information for where employees may receive the cleaning and disinfection planthat the employer is implementing per the guidelines of the CDC and the Cal/OSHA standards.
  7. Note: Workplace cleaning and disinfection plans are not currently part of CDC guidelines or Cal/OSHA requirements, so many employers will likely refer to their normal cleaning and/or disinfection protocols that may be independent of COVID-19 mitigation measures.

AB 2693 also requires the notice to be in English and the language understood by the majority of the employees.

Proposed Permanent COVID-19 Cal/OSHA Standard

Another major change is looming in the horizon. On January 1, 2023, a new 2-year “permanent”, or “non-emergency”, COVID-19 standard will likely replace the existing Emergency Temporary Standards which we have extensively written about in the past.

Several variations on the proposed rules have already been circulated ahead of a December 15th CAL/OSHA public meeting, during which the Cal/OSHA Standards Board is widely expected to pass the new standard in advance of the December 31, 2022 expiration of the current ETS.

Much of the ETS has carried over into the new proposed standard, but there are also some major changes that employers should be aware of.

Highlights from the Proposed Non-Emergency Standard

  • Definition changes. The proposed permanent standard makes changes to many of the definitions we have seen in the ETS. Some of the more significant changes include:
    • “Close Contact” – Instead of a single definition for close contact, the proposed standard distinguishes between two scenarios based on workplace size. (Note that this new definition already applies in workplaces covered by the ETS because it was changed by an Order issued by CDPH on October 13, 2022).
      • In indoor spaces of 400,000 cubic feet or less, a close contact results from sharing the same indoor space for 15 or more cumulative minutes within 24 hours during the infectious period. Here, six feet of distance does not matter.
      • In indoor spaces of greater than 400,000 cubic feet, a close contact results from being within six feet of a COVID case for a cumulative total of 15 minutes or more within 24 hours during the infectious period.
      • Importantly, each room with floor-to-ceiling walls makes up a distinct indoor space for purposes of this rule. Employees wearing a respirator during this time are not close contacts.
    • “Exposed Group” – The new standard makes a few changes here. Most importantly, places where individuals momentarily pass through without congregating, regardless of whether they are wearing a face covering, are not considered for the purpose of determining if a group has been exposed.
      • Under the current ETS, everyone in the space had to wear a face covering, even with respect to momentary exposures, or else they would be considered part of an exposed group.
    • “Infectious Period” – Under the proposed permanent standard, the definition of infectious period is less stringent and allows for a shorter time frame.
      • For symptomatic cases, the infectious period may now end five days (down from 10 days) after the arrival of symptoms if the individual tests negative on that day and has not had a fever for over 24 hours without medication.
      • For asymptomatic cases, the infectious period may also end five days after a positive test if a negative test is produced on the fifth day.
    • “Returned Case” – Instead of a 90-day period following the initial onset of symptoms or positive test, the proposed rules changes this to 30 days, after which time someone who returned to work following a COVID-19 related absence is no longer considered a returned case.
      • This shortened time period means that employers may be required to provide COVID-19 testing to a larger number of employees, as returned cases under the ETS are exempt from the requirement.
  • Exclusion pay. One of the most notable differences between the current ETS and the proposed permanent standard is the absence of exclusion pay.
    • Currently, employers must continue and maintain employees’ earnings, seniority, rights, and benefits if they have been excluded from the workplace due to COVID-19 exposure or illness contracted at work. Employers have to provide exclusion pay under the ETS before requiring employees to exhaust other forms of potential paid leave, like Supplemental Paid Sick Leave.
    • The proposed permanent standard eliminates this provision. Instead, employers must only provide information to confirmed cases and close contacts about COVID-19 benefits they may be entitled to under local and federal law.
  • Notice requirements. The notice requirements have also been somewhat streamlined.
    • The ETS requires employers to provide written notice to all employees present at a worksite during the infectious period of a COVID-19 case within one business day of when they learn of the case. Notice must also be sent to independent contractors and other employers whose employees were on the premises during this period.
    • The proposed permanent standard includes similar notice requirements, but changes the time frame for notice to “as soon as possible,” so long as the employer is able to meet any potential exclusion requirements. It also defers to Labor Code 6409.6 for the content and form of notice, which means employers would be allowed to do posting instead of providing notices in writing, in light of recent amendments mentioned above.
  • Reporting and recordkeeping. Reporting and recordkeeping requirements have changed to reflect increasing priorities on cases and large outbreaks, rather than exposures or isolated cases.
    • Employers no longer have to report information about workplace COVID-19 cases and outbreaks to their local health department. (Though employers need to be aware that local health departments may still promulgate their own requirements on reporting.)
    • Additionally, while employers must keep a record of COVID-19 cases for two years, they no longer have to keep records of close contacts.
    • The requirement that employers document the steps taken to implement a separate COVID-19 Prevention Program has also dropped away, meaning employers can generally rely on their standard Injury and Illness Prevention Program (IIPP), as long as the IIPP adequately addresses employee health and safety policies and procedures related to COVID-19.
    • The proposed permanent standard adds that in a major outbreak setting, employers must report the outbreak to Cal/OSHA. The proposed rule does not specify a time frame within which the report must be made.
  • Face coverings. In many ways, the rules remain the same. There are, however, some important distinctions:
    • Under both the current and proposed standards, employees who are exempted from a mandatory face covering requirement due to medical, disability, or mental health reasons must wear “an effective nonrestrictive alternative” if possible. But, if a face covering is not possible, the proposed permanent standard no longer mandates any sort of testing for these employees.
    • Employers are required to ensure employees wear face coverings when required by a CDPH regulation or order.
  • Outbreaks. Currently, the ETS outbreak rules come in play once three or more COVID-19 cases in an exposed group visit a work site during their infectious period within a 14-day window, and last until there are no new cases detected in a 14-day period. The proposed permanent standard contains various key changes to these rules. Most notably:
    • The provisions concerning outbreaks no longer apply once there have been one or fewer cases detected in an exposed group within a 14-day period. This change may slightly decrease the amount of time that an employer has to follow the more stringent procedures in the event of an outbreak.
    • Currently, during an outbreak employers must evaluate whether HEPA or other filtration units would reduce the risk of transmission. The proposed standard requires employers to utilize HEPA units upon an outbreak whenever ventilation is inadequate to reduce transmission.
    • Provisions on major outbreaks still apply when there are more than 20 cases detected in a 14-day period, and employers need to comply with those provisions as long as there is more than one case detected in the exposed group within a 14 day period.
    • Finally, and very importantly, during a major outbreak, employers must report the outbreak to the Division. This is not a requirement under the current emergency standard.
  • Return to work criteria. The criteria for when a COVID-19 case may return to work is largely the same, but under the proposed rule, there is no difference in the standard for those whose symptoms, other than a fever, remain. Thus, under the proposed permanent standard, the continued presence of symptoms is irrelevant if on the fifth day a negative test is produced, unless one of the symptoms is a fever.
  • Ventilation. Currently, employers are required to evaluate how existing ventilation systems may be modified to maximize ventilation with outdoor air. The proposed rule eliminates this language.
    • Instead, the proposed non-emergency standard obligates employers to “develop, implement, and maintain” a prevention plan that incorporates at least one of the following:
      • Maximizing outdoor air when ambient conditions do not pose a hazard.
      • Filtering circulated air through a MERV-13 filter or as much filtration as the existing ventilation system will permit.
      • Using HEPA filtration units in indoor spaces when ventilation is inadequate.
  • Employer-provided housing. Unlike the ETS, the proposed rule would not require employers to prioritize housing assignments in a particular order. Instead, it merely directs employers to consider distinct cohorts in housing assignments.
  • Employer-provided transportation. Many of the requirements of the ETS pertaining to transportation have been dropped. In their place, the proposed standard instructs employers to comply with the general provisions applicable to workplaces.

The rules highlighted here represent the most substantive differences between the ongoing ETS and the proposed permanent standard set to replace it at the start of 2023. The Division is accepting comments by email (oshsb@dir.ca.gov) on the most recent version of the proposed standard until October 31st. It remains possible that the proposed “permanent standard” that ultimately goes into effect may be different in some regards than what’s currently proposed.

Workplace Solutions

Stay tuned for updated guidance and developments on the workplace safety front in California. Seyfarth will be closely monitoring the outcome of the December 15 meeting on the proposed permanent standard, and will be updating our readers here. Don’t hesitate to reach out to your favorite Seyfarth attorney should you have any questions.

Seyfarth Synopsis: Late into the 2021-2022 legislative period, California approved a set of bills —AB 1041 and AB 1949—that expand the CFRA and the Paid Sick Leave law and provide a statutory entitlement to bereavement leave for workers in the state. The new laws leave one to wonder whether California legislators were at least partly inspired by a particular action drama.

In the television series Designated Survivor, HUD Secretary Tom Kirkman is named the designated person to take over the presidency if other members in the presidential line of succession perished all at once. After a series of unlikely incidents, this is exactly what happens. Two of California’s most recent laws seem to use this TV show for inspiration, adding leave protections to the designated and the survivor.

The Designated

One of the leave bills recently signed into law, AB 1041, expands the protections of both the California Family Rights Act and California Paid Sick Leave law. Under the new enactments, employees can designate their very own Tom Kirkman. Notably, unlike in tv-land, the “designated person” is not a potential successor to the office of the President. Instead a designated person is a person in need of care for whom an employee could take leave from work.

Choosing a Designee

AB 1041 says that under CFRA, employees of businesses employing five or more people can now take protected leave to care for a designated person. A designated person for CFRA purposes is any individual related by blood or whose association with the employee is the equivalent of a family relationship (without describing what this means). This means that an employee could look beyond their own first family and select someone from their expansive cabinet, no matter how far removed they are in the line of succession, so long as they are akin to a family member.

To keep employers on their toes like a Secret Service Agent, the amendments to California’s Paid Sick Leave law define designated person differently, and more broadly. For the purpose of PSL, “family member” as used in that statute now includes a designated person who is simply a person identified by the employee at the time the employee requests paid sick days, with no need for blackmailing, espionage, or broad conspiracy to pick the new person.

Why the Plot Twist?

The writers working behind the scenes on the bill explained that AB 1041 is a recognition of chosen families—or in other words non-nuclear family structures—and an effort to empower employees to care for others regardless of blood or legal relationships. In particular, this legislation was backed by a number of minority rights and LGBTQI+ advocacy groups.

California modeled its law after similar laws in Oregon, Connecticut, New Jersey, Colorado, and municipalities like Los Angeles, that have previously passed paid leave laws covering chosen families.

A Potential for Peril as Wide as the Potomac

At the risk of giving away spoilers, we should note that AB 1041 creates new avenues of exposure. The bill allows employees to designate one new person for each twelve-month period. While employers are free to limit designated persons to just one in the period of a year, employees are entitled to select a new designated person every twelve months.

Also headline grabbing is the fact that when requesting either CFRA or paid sick leave, an employee must be allowed to designate a person at the time the request is made. Employers therefore cannot require employees to designate a person in advance.

The Survivor

A second leave bill that recently became law, AB 1949, focuses on the survivor. It requires any business which employs five or more persons to allow qualified employees up to five days of bereavement leave for the death of a family member. If an employee has worked thirty or more days within the last twelve months, they are eligible for this bereavement leave.

For now, the law does not explicitly require bereavement leave for the death of designated persons (as explained above), but only for a traditional family member (“a spouse or a child, parent, sibling, grandparent, grandchild, domestic partner, or parent-in-law”).

This means that if our friend Tom Kirkman was an employee in California, the untimely expiration of all his coworkers in a catastrophic event would not entitle him to protected bereavement leave under AB 1949, tragic as this may be. Unless of course they were also his relatives.

A Move Fit for Television

AB 1949 is the result of a years-long effort to give employees an entitlement to bereavement leave, and was driven at least in part by the COVID-19 pandemic with the number of employees who lost loved ones and were not necessarily able to take time off of work. According to the bill’s authors, AB 1949 is meant to account for losses in an employee’s productivity following the death of a family member, and to allow them protected time off work to grieve.

Traps for the Unwary

As with most California employment laws, AB 1949 presents a few potential pitfalls:

  1. Employers must be aware that an employee is not required to take all of their bereavement leave at once. Although the employees’ days off do not have to be consecutive, employers may require this leave to take place within three months of the death of the family member.
  2. Although the law permits bereavement leave to be unpaid, employees must be permitted to use vacation, personal leave, accrued and available sick leave, or other available compensatory time.
  3. If an employer has an existing bereavement leave policy, it must nonetheless meet the requirements of the new law (i.e., provide at least five nonconsecutive days of leave time). If the employer already has some paid bereavement days (but not five), it can comply with this new law by offering the remaining days as unpaid leave, or allowing use of other paid time off.
  4. While the law allows employers to require “documentation” of the death of the family member, it permits a wide array of documentary evidence including death certificates, published obituary and more. Employers should therefore err on the side of caution when asking for proof before allowing bereavement leave.
  5. The bill only has a collective bargaining agreement carve out where the CBA provides a bereavement leave policy that is at least as generous as this new law (i.e. provides for at least five non-consecutive days off within three months).

Employers must also remember that AB 1949 prohibits employers from retaliating against an employee who requests or takes bereavement leave, and it prohibits discrimination or interference with employees seeking to exercise these new rights.

Workplace Solutions

Unlike the TV show, Designated Survivor, these changes to the legal landscape will likely not disappear after three seasons. Employers should review their leave polices and revise them if necessary ahead of when the laws become effective on January 1, 2023. Feel free to designate your favorite Seyfarth attorneys to help your business survive this most recent round of regulation.

Edited by Coby Turner

Seyfarth Synopsis: Taking it down to the wire, Governor Newsom approved the vast majority of labor and employment bills that ran the legislative gauntlet, including bills that will expand pay data reporting and pay scale disclosure requirements, extend COVID-19 Supplemental Paid Sick Leave, create mandatory wages and working conditions for fast food workers, and more.

On the night before his September 30, 2022, deadline to sign or veto bills, Governor Newsom finished his review of all labor and employment bills the Legislature had passed to him for approval. While this year saw fewer labor and employment bills than usual, the measures that passed carry hefty obligations. Overall, Governor Newsom signed 997 of the 1,166 bills sent to his desk, and he vetoed 169 bills (almost twice the veto rate from last year), according to a prominent Capitol lobbyist.

Top of employers’ minds are bills that will expand pay data reporting and pay scale disclosure requirements, extend COVID-19 Supplemental Paid Sick Leave (again), and create a mandatory wages and working conditions program for fast food workers. Below is our summary of those bills the Governor signed into law, and two notable bills that did not make the cut. All new laws are effective January 1, 2023, unless otherwise stated.

Bills That Got The Governor’s Nod

SB 1162: Pay Data Reporting and Pay Scale Disclosures

As we previously reported, SB 1162 expands existing requirements that employers with 100 or more employees provide the California Civil Rights Department (CRD, f/k/a the DFEH) with specified EEO-1 pay data. Effective January 1, 2023, employers must include in their 2023 pay data reports (with a new annual due date of the second Wednesday in May) mean and median hourly rates by each combination of race, ethnicity, and sex, and submit a separate second report if they have 100 or more employees hired through labor contractors (provided at least 1 employee is in CA).

The new law will also require that all employers provide a pay scale to current employees upon request, and that employers with more than 15 employees provide a pay scale in all job postings, including those posted by third parties. The new law further imposes a new record retention requirement—starting January 1, 2023, employers must maintain records of job titles and wage rate histories for the duration of an employee’s employment and three years after termination of employment.

We’re watching for administrative agency guidance and FAQs, and will update you as soon as any issue.

Amends Section 12999 of the Government Code and Section 432.3 of the Labor Code.

AB 2188: Off-the-Job Cannabis Use Protection

As we previously discussed in detail, starting January 1, 2024, AB 2188 will prohibit employers from discriminating against a person based upon their off-the-job use of cannabis. The new law permits employers to take action against a person for failing a valid pre-employment drug test that does “not screen for nonpsychoactive cannabis metabolites.” The new law also allows an employer to administer a performance-based impairment test, and to terminate the employment of an employee who is determined to be impaired by cannabis on the property or premises of the place of employment. These provisions do not apply to employees in building or construction trades, and do not preempt state or federal laws requiring employees to be tested for controlled substances.

Adds Section 12954 to the Government Code.

AB 152: COVID-19 Supplemental Paid Sick Leave (Again)

The 2022 COVID-19 SPSL law was set to sunset on September 30, 2022—because of this bill, it did not. This bill was a last minute gut and amend to AB 152 and received the Governor’s approval on September 29, extending employee’s ability to use their remaining SPSL balance to December 31, 2022.

This new law, which took effect immediately upon the Governor’s signing, only extends the time during which workers can elect to use the leave—it is not a newly-banked tranche of leave. The qualifying reasons for leave remain the same, as we previously summarized.

In a slight change to the existing law, where an employer requires an employee to test on or after day 5 from their first positive test to potentially return to work, if the employee still tests positive, employers are now permitted to require an employee to submit to a second diagnostic test within no less than 24 hours. The employer may decline to continue to provide SPSL where the employee refuses a second test.

Amends Sections 248.6 and 248.7 of the Labor Code.

AB 2693: COVID-19 Exposure Notifications and Cal/OSHA Rights

In the only other COVID-related employment bill to make the cut, AB 2693 extends for a year, until January 1, 2024, the previous COVID-19 exposure-related bill passed in 2020—AB 685—which we blogged about in detail.

As you may recall, this bill gives Cal/OSHA the ability to shut down a worksite, when, in Cal/OSHA’s opinion, it exposes workers to an imminent hazard of a risk of COVID-19 infection. The law also allows Cal/OSHA to require a notice of prohibition be posted in a conspicuous place at the place of employment.

Significantly, arguably the biggest headache of AB 685 for employers—the individual notification requirements—has changed. The new law revises the current requirement that an employer must provide individual written notices to employees within 1 business day of exposure to instead allow this notification requirement be satisfied by, in each worksite, prominently displaying a notice of exposure in all places where notices to employees concerning workplace rules or regulations are customarily posted.

The notice must still be posted within 1 business day from when the employer receives a notice of potential exposure, and it must remain posted for no less than 15 calendar days, stating the dates on which an employee, or employee of a subcontracted employer, with a confirmed case of COVID-19 was on the worksite premises within the infectious period, the location of the exposure(s), and more. If an employer chooses this notification option, it is required to keep a log of all the dates the notice was posted at each worksite, and to allow the Labor Commissioner to access these records.

The law alternatively allows the employer to continue provide individual written notice to all employees as it has been doing under AB 685. The law also allows notice be provided to employers of subcontracted employees who were on the premises at the same worksite as the confirmed case of COVID-19 within the infectious period that they may have been exposed to COVID-19 in a manner the employer normally uses to communicate employment-related information.

IMPORTANT NOTE: Currently, this new law is at odds with the requirements of the Cal/OSHA Emergency Temporary Standard (“ETS”) on COVID-19, which requires individual written notice. The ETS is currently set to expire at the end of 2022, but the agency released a proposed “permanent” rule on June 18, 2022 that proposes to impose COVID-19 requirements on workplaces through 2024—this will be considered at OSHSB’s December 15, 2022, meeting. The new proposed rule (if passed) does not explicitly state whether posting a notice would be sufficient, so please stay tuned for updates.

Amend Sections 6325 and 6409.6 of the Labor Code.

AB 1041: Leave and Sick Time – Designated Person

AB 1041 amends the California Family Rights Act (“CFRA”) and the California Paid Sick Leave Law (“PSL”) to include a “designated person” for whom an employee may take leave, in addition to the family members presently covered within their scope.

A designated person under the CFRA is defined as “any individual related by blood or whose association with the employee is the equivalent of a family relationship,” and includes domestic partners. To keep things complicated, a designated person under the new PSL provisions is different and broader—it can be any person identified by the employee. An employee can identify their designated person at the time they request leave or request to use PSL. 

Under both the CFRA and PSL revisions, an employer may limit an employee to naming one designated person per 12-month period. And, under the CFRA, an employer may require the employee substitute any of the employee’s accrued vacation leave or other accrued time off during a leave period, or any other paid or unpaid time off negotiated with the employer.

Amends Section 12945.2 of the Government Code and Section 245.5 of the Labor Code.

AB 1949: Protections for Bereavement Leave

AB 1949 also amends the CFRA to prohibit an employer from denying a request to take up to 5 days of bereavement leave upon the death of a family member, provided the employee has at least 30 days of active service. Family member is defined as spouse or a child, parent, sibling, grandparent, grandchild, domestic partner, or parent-in-law, as defined in Gov’t Code 12945.2.

While the days of bereavement leave need not be taken consecutively, the allotted leave must be completed within three months of the death of the family member. If the employer does not have a paid bereavement policy, the leave may be unpaid, except that an employee may use vacation, personal leave, accrued and available sick leave, or compensatory time off that is otherwise available to the employee.

The new law allows the employer to require documentation of the death of the family member, which can be a death certificate or a published obituary (among other broad types of verification). The new law also prohibits retaliation for requesting bereavement leave.

Amends Sections 12945.21 and 19859.3 of, and adds Section 12945.7 to, the Government Code.

SB 951: Family Temporary Disability Insurance Payments: Benefit Formula Changes

SB 951 extends wage replacement rates for State Disability Insurance and Paid Family Leave (PFL) that were set to sunset at the end of 2023, and revises the formulas for the weekly benefit amounts under the family temporary disability insurance (PFL) program to increase wage replacement rates.

The Governor touted SB 951 as “build[ing] on the Governor’s action since taking office to bolster access to workplace leave, including legislation to expand job-protected family leave to millions more Californians, extend paid family leave benefits for a newborn child from 6 to 8 weeks and expand paid sick leave in response to COVID-19.”

Amends Sections 2655 and 3301 of, and amends and repeals Section 985 of, the Unemployment Insurance Code.

AB 257: Fast Food Accountability and Standards Recovery Act (FAST Recovery Act)

As we wrote when the Governor ceremoniously approved this bill on Labor Day, AB 257 establishes a Fast Food Sector Council charged with creating a fast food workers’ bill of rights “to establish sectorwide minimum standards on wages, working hours, and other working conditions adequate to ensure and maintain the health, safety, and welfare of, and to supply the necessary cost of proper living to, fast food restaurant workers.”

The new law forbids the Council from promulgating regulations requiring predictable scheduling, amending current statutes, or creating new paid time off benefits, and regulates the amount the Council may establish for purposes of minimum wage. The Council will be subject to legislative oversight, and is required to “provide information as requested by the appropriate committees of the Legislature.”

The new law also establishes a rebuttable presumption of unlawful discrimination or retaliation if an adverse action is taken against an employee within 90 days following the employer learning that the employee filed a complaint, or refused to work based on a reasonable belief that the condition of the restaurant would violate worker health and safety laws.

Amends Section 96 of, and adds Part 4.5.5 (commencing with Section 1470) to Division 2 of, the Labor Code.

AB 676: Franchisor Discrimination

AB 676 prohibits a franchisor from failing or refusing to grant a franchise or financial assistance to a current franchisee or prospective franchisee based solely on any characteristic protected by the Unruh Civil Rights Act of the prospective franchisee, or of the geographic area where the franchise is located, if any characteristic of the composition of the neighborhood or geographic area where it is to be located is protected by the Unruh Act.

The Unruh Act confers protected status based on sex, race, color, religion, ancestry, national origin, disability, medical condition, genetic information, marital status, sexual orientation, citizenship, primary language, or immigration status.

Amends multiple Business and Professions Code and Corporations Code provisions.

SB 1044: Emergency Conditions – Prohibition on Adverse Employment Actions and Certain Cell Phone Restrictions

SB 1044 prohibits employers, in the event of an emergency condition, from: (1) taking or threatening adverse action against an employee for refusing to report to or leaving a workplace because they feel unsafe; or (2) preventing an employee from accessing their mobile device for use for emergency purposes. The bill defines “emergency condition” as either: (1) conditions of disaster or extreme peril to the safety of persons or property at the workplace caused by natural forces or a criminal act; or (2) an order to evacuate a workplace, a worker’s home, or the school of a worker’s child due to natural disaster or a criminal act. A health pandemic is not considered an emergency condition, and the measure is inapplicable to emergency conditions that have ceased.

The employee, where feasible, will be required to notify the employer of the emergency condition before benefiting from the law’s provisions. The new law does not apply to first responders, disaster service workers, employees on military bases, and employees of residential care facilities, among others.

While a violation of these provisions could subject an employer to a private lawsuit and penalties under the Private Attorneys General Act (PAGA), the new law allows a right to cure alleged violations following Labor Code section 2688.3.

Adds Chapter 11 (commencing with Section 1139) to Part 3 of Division 2 of the Labor Code.

SB 1334: Public Sector Healthcare Employees Meal and Rest Periods

SB 1334’s stated intent is to ensure “equity in working conditions and patient care standards for hospital, clinic, or public health employees who provide direct patient care or support direct patient care” to provide them with the same rights to meal and rest breaks as private sector workers.

Accordingly, SB 1334 entitles employees who provide direct patient care or support direct patient care in a general acute care hospital, clinic, or public health setting, and are directly employed by the state and its subdivisions, counties, municipalities, and the Regents of the University of California, to one unpaid 30-minute meal period on shifts over 5 hours and a second unpaid 30-minute meal period on shifts over 10 hours, as provided by Section 512. It also entitles these workers to a net 10-minute rest period for every 4 hours or major fraction thereof, as provided by Wage Order Number 4 and Wage Order Number 5 of the Industrial Welfare Commission.

As private industry employers know well, the law requires an hour of premium pay at the regular rate for each missed meal or rest break, but allows on-duty meal periods in accordance with Wage Orders 4 and 5, and contains a CBA carve-out.

Adds Section 512.1 to the Labor Code.

AB 2183: Agricultural Labor Relations—Expanding Unionization Options

As an alternative procedure to the polling place election process set forth in Section 1156.3 of the Labor Code, this new law will permit a labor organization to be certified through either a labor peace election or a non-labor peace election as the exclusive bargaining representative of a bargaining unit, through a representation ballot card election or by mail, thereby permitting a bargaining unit to summarily select a labor organization as its representative for collective bargaining purposes without holding a polling place election.

This bill’s approval was a bit of a last minute surprise, as last year, Governor Newsom vetoed a similar measure. But, this year the scales appear to have been tipped when President Biden, who has pledged to be the most union-friendly President in history, encouraged Governor Newsom to sign the measure.

Adds Sections 1160.10 and 1162 to the Labor Code.

AB 1601: Call Centers—Layoff Requirements

AB 1601 will prohibit a call center employer from ordering a relocation of its call center unless notice of the relocation is provided to the affected employees at least 60 days prior to the relocation. While this may look similar to the existing statutory requirements, AB 1601 amends California’s mini-WARN Act in a few key respects.

First, it gives the Labor Commissioner greater power to enforce the statute, including investigating an alleged violation and ordering appropriate temporary relief to mitigate the violation pending the completion of a full investigation or hearing, including by issuance of a citation against an employer who violates the statute.

Second, it changes the Cal-WARN trigger for relocations of call center employees to foreign countries. A call center employer now cannot 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, outside of the United States without providing at least 60 days prior notice to the affected employees. This new provision eliminates the numeric, temporal, and geographical threshold applicable to other types of operations besides call centers (i.e. 50 or more employees within 30 days, or relocation of at least 100 miles). This means that moving a small, but high volume, operating unit of even 5-10 people across the border from San Diego to Mexico could theoretically trigger application of the statute.

The bill originally would have required an employer of employees in a call center that intends to relocate from California to notify the Labor Commissioner at least 120 days before the relocation. The bill underwent serious amendments in the legislative process, recasting its provisions to provide employment protections for employees in call centers subject to relocations that are more in line with California’s existing statutory WARN requirements.  

Amends Labor Code Sections 1400, 1406, and adds related Labor Code Articles.

AB 2777: Extending Sexual Assault Statute of Limitations

This new law amends the Code of Civil Procedure to permit a putative plaintiff, from January 1, 2023, to December 31, 2023, to pursue a cause of action in court based on sexual assault regardless of whether that claim would be barred by the applicable statute of limitations, so long as the alleged wrongful actions occurred on or after January 1, 2009. This is despite the fact that the Code of Civil Procedure already provides for a lengthy ten-year statute of limitations for claims relating to a sexual assault.

A plaintiff seeking to revive a claim under this new law must allege: (1) they were sexually assaulted; (2) one or more entities are legally responsible for damages arising out of the sexual assault; and (3) the entity or entities (including, but not limited to, their officers, directors, representatives, employees, or agents) engaged in a cover up or attempted a cover up of a previous instance or allegations of sexual assault by an alleged perpetrator of such abuse.

Also, before “reviving” a claim under this provision, the attorney bringing the claim must sign a declaration “stating that the attorney has reviewed the facts of the case and consulted with a mental health practitioner, and . . . that it is the attorney’s good faith belief that the claim value is more than two hundred fifty thousand dollars.”

Amends Section 340.16 of the Code of Civil Procedure.

AB 1775: Occupational Safety, Live Events

AB 1775 will require an entity that contracts with an entertainment events vendor to set up, operate, or tear down a live event at a public events venue to require the vendor to certify for its employees and employees of its subcontractors that those individuals have complied with specified training, certification, and workforce requirements, including the prescribed trainings of the US DOL’s OSH Administration.

As the reason for this bill, the Legislature stated that the workers who set up and tear down staging, including lighting systems, sound systems, video walls, and other scenic elements for live events at arenas, stadiums, fairgrounds, and outdoor venues, face serious workplace hazards that can risk the safety of the workers, performers, and the public, and noted there is a history of accidents, injuries, and fatalities of workers responsible for setting up and breaking down events.

Adds Part 14 (commencing with Section 9250) to Division 5 of the Labor Code.

AB 1788: Sex Trafficking: Hotels

AB 1788 will allow civil penalties to be imposed against a hotel if a supervisory employee of the hotel knew of 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 employee of that hotel was acting within the scope of employment and knowingly benefited from participating in a venture that the employee knew, or acted in reckless disregard of, sex trafficking activity within the hotel.

Hotel is defined as a motel, or any other operator or management company that offers and accepts payment for rooms, sleeping accommodations, or board and lodging and retains the right of access to, and control of, a dwelling unit that is required to provide training and education regarding human trafficking awareness pursuant to Section 12950.3 of the Government Code.

The new law also authorizes a city, county, or city and county attorney to seek equitable relief against a hotel, and to seek a civil penalty of $1,000 for the first violation, $3,000 for a 2nd violation within the same calendar year, and $5,000 for a 3rd and any subsequent violation of sex trafficking within the same calendar year. The new law also authorizes a court to consider specified factors and exercise its discretion to increase the amount of the civil penalty, not to exceed $10,000, for any 4th or subsequent violation. The law requires that the action be commenced within 5 years of the violation, or within 5 years of the date the victim attains the age of majority.

Adds Section 52.65 to the Civil Code.

AB 1632: Restroom Access for Certain Medical Conditions to Employee Restrooms

AB 1632 will require a place of business that is open to the general public for the sale of goods and that has a toilet facility for its employees, to allow any individual who is lawfully on the premises of that place of business to use that toilet facility during normal business hours, even if the place of business does not normally make the employee toilet facility available to the general public, if:

  1. The individual has an eligible medical condition or uses an ostomy device;
  2. Three or more employees of the place of business are working onsite at the time that the individual requests use of the employee toilet facility;
  3. The employee toilet facility is not located in an employee changing area or an area where providing access would create an obvious health or safety risk to the requesting individual or would create an obvious security risk to the place of business;
  4. Use of the employee toilet facility would not create an obvious health or safety risk to the requesting individual; and
  5. A public restroom is not immediately accessible to the requesting individual.

If the place of business requires the requesting individual to present reasonable evidence that the individual has an eligible medical condition or uses an ostomy device, the individual may present a signed statement issued to the individual by a physician, nurse practitioner, or licensed physician assistant, on a form the Department of Public Health must develop containing specified information. Eligible medical conditions are Crohn’s disease, ulcerative colitis, other inflammatory bowel disease, irritable bowel syndrome, or another medical condition that requires immediate access to a toilet facility.

Failure to comply with these provisions subjects the place of business to civil penalties of $100 per violation for violation of these provisions only if the violation was willful or grossly negligent. There is no private right of action.

Adds Article 6 (commencing with Section 118700) is added to Chapter 2 of Part 15 of Division 104 of the Health and Safety Code.

Significant Bills That Did Not Make The Cut

SB 1262: Background Checks

SB 1262 was inspired by the California Court of Appeal’s decision in All of Us or None of Us. v. Hamrick, which held that an individual’s date of birth and driver’s license number could not be used as data identifying a criminal defendant in public records. This caused courts around the state to redact birth dates and driver’s license numbers from their indexes, making routine background checks much more difficult.

This law would have abrogated the Court’s decision, and required publicly accessible electronic indexes of defendants in criminal cases to permit searches and filtering of results based on a defendant’s driver’s license number or date of birth.

The Governor vetoed this bill on September 29, 2022, stating that he believes it would not protect an individual’s right to privacy, even if it would make background checks easier, since any member of the public could easily access individuals’ sensitive personal information online. It now sits in the Senate to consider whether to attempt to override the Governor’s veto.

AB 1102: Extending Employment Exemptions to the California Privacy Rights Act (CPRA)

Proposed but never adopted gut and amend amendments to AB 1102 (and related legislation) would have extended or made permanent exemptions under the California Consumer Privacy Act (CCPA) applicable to personal information collected in human resources (HR) and business-to-business (B2B) contexts. With the failure of these bills to pass through the legislature, these exemptions will expire when the CPRA amends the CCPA on January 1, 2023, leaving CCPA-regulated businesses four months to come into compliance with the CCPA’s requirements as applied to HR and B2B data.

This means covered employees will have increased rights with respect to their personal data collection, correction, deletion, portability, and disclosure, of which employers should make sure they are aware by reviewing our previous detailed blog on these new requirements.

To be clear, AB 1102 was approved by the Governor, containing its original subject matter—telephone medical advice services—not CPRA/CCPA-related content.

Workplace Solutions

We welcome you to attend our October 7, 2022, webinar regarding these new laws, and the new compliance obligations they create for employers. Among other things, we’ll discuss necessary adjustments to Supplemental Paid Sick Leave policies and practices to account for the slight changes made with the extension; the need to review pay reporting and pay scale disclosure obligations, policies, and processes, and recordkeeping practices to ensure compliance with SB 1162’s new pay transparency requirements; and the need to review drug testing policies, practices and procedures; and employee handbook and leave policies and practices for the CFRA changes. Please visit our website to register for the free webinar.

And, of course, stick with us here at California Peculiarities, and you can also check out our Policy Matters podcast and newsletter for regular check-ins on California (and national) policy and legislative updates as well.

Edited by Elizabeth Levy and Coby Turner

Seyfarth Synopsis: SB 1162, approved by Governor Newsom on Tuesday, September 27, will require employers starting January 1, 2023, to disclose pay scales to current employees and on job postings, and to report even more pay data to the California Civil Rights Department (CRD, formerly DFEH), including median and mean hourly rates.

On September 27, 2022, Governor Newsom signed another groundbreaking pay transparency law, SB 1162, into law. Effective January 1, 2023, employers will be required to disclose more pay data and provide pay ranges on job postings and to requesting employees, to increase pay transparency for applicants and employees. The signing of SB 1162 makes California the largest state that requires the affirmative disclosure of pay scale information, and takes the state a step further in its pay transparency efforts, by requiring that employers add mean and median pay data as well as pay data of employees supplied by labor contractors in pay data reports.

More Robust Pay Data Reporting Begins with the May 10, 2023 Pay Data Report

Proponents of SB 1162 believe that California’s current pay data reporting law does not go far enough in its requirements for employers. The Governor and First Partner agreed, as they highlighted after meeting with the Legislative Women’s Caucus to promote the passage of SB 1162 and other gender-related bills.

SB 1162 makes the following changes to requirements regarding employer pay data reports under Government Code Section 12999:

  • Within each job category, employers must report the median and mean hourly rate by each combination of race, ethnicity, and sex.
  • Reports are now due annually on the second Wednesday of May. The first report is due on May 10, 2023, based upon calendar year 2022 pay data.
  • Employers with multiple establishments are no longer required to submit a consolidated report. These employers must continue to submit a report for each establishment.
  • Employers that have 100 or more employees hired through labor contractors have a new obligation to produce data on pay, hours worked, race/ethnicity, and gender information in a separate report.
    • Note: The law requires labor contractors to “supply all necessary pay data to the private employer,” but does not contain a separate mandate for the labor contractors to collect the “necessary pay data,” nor does it define the data required or address issues with regard to timing of these disclosures. The law also allows courts to apportion an “appropriate amount” of any penalties to any labor contractor who failed to provide required pay data to the employer.

Employers who fail to file pay data reports may be subject to a civil penalty up to $100 per employee for initial failures to file and $200 per employee for subsequent failures to file.

Pay Scale Disclosures

SB 1162 also makes significant changes to California’s pay scale disclosure law under Labor Code Section 432.3. California’s new pay scale disclosure requirements follow the trend we have witnessed nationwide as cities and states adopt their own pay scale disclosure mandates.

Current law in California requires employers to provide candidates for employment the pay scale for the position the candidate is seeking only upon request. As of January 1, 2023, employers must also comply with the below requirements:

  • Employers with 15 or more employees must include a pay scale in all job postings (and to provide that information to third parties who post those jobs).
    • Note: No penalty will apply for a first violation of this requirement if the employer can show that all job postings for open positions have been updated to include the pay scale.
  • All employers, regardless of size, must provide a pay scale for a current employee’s position at the employee’s request.

Labor Code Section 432.3 defines pay scale as the salary or hourly wage range that the employer reasonably expects to pay for the position.

Pay Data Record Retention Requirement

SB 1162 also introduces a record retention requirement. Employers must maintain records of job titles and wage rate histories for the duration of an employee’s employment and three years after termination of employment. The California Labor Commissioner will have authority to inspect these records.

Failure to comply with the pay scale disclosure or record retention requirements can result in penalties ranging from $100 to $10,000 per violation.

Watch Those Effective Dates

SB 1162’s pay scale disclosure and record retention requirements are effective beginning January 1, 2023.

The updated pay data reports, including mean and median hourly rates, are due starting May 10, 2023.

Employers are well-advised to start preparing for all of these new requirements now.

Workplace Solutions

Employers should make compliance plans for California’s new pay transparency provisions, including compiling and reviewing data to identify areas needing attention. The authors and your favorite Seyfarth attorneys are available to discuss your organization’s specific plan for compliance and any questions regarding implementation and application of the new pay reporting and pay scale disclosure requirements.

Edited by Coby Turner

Seyfarth Synopsis: A city that knows how to prepare for a natural disaster better than Charlie Mackenzie is now arming its employees to better face any future pandemics or public health crisis. San Francisco voters recently passed Proposition G, which requires employers with 100 or more employees worldwide to provide up to 80 hours of paid public health emergency leave to their San Francisco employees during a public health emergency. This ordinance will become operative on October 1, 2022.

Whoa-man! A Permanent Leave Provision For Future Public Health Emergencies

After San Francisco repeatedly renewed its Public Health Emergency Leave Ordinance (“PHELO”) related to COVID-19, the City is implementing a permanent public health emergency leave (“PHEL”) requirement for employers operating within San Francisco. This leave is available during a local or statewide health emergency related to a contagious, infectious, or communicable disease as declared by the City of San Francisco or California’s health officer, or when the Bay Area Air Quality Management District issues a Spare the Air Alert.

From the Pentavirate To The Local Butcher Shop—Who Is Covered?

Small businesses such as Meats of the World will escape coverage of the new far-reaching law. The ordinance will apply to larger employers with 100 or more employees worldwide. The PHELO exempts certain non-profit organizations that do not engage in specific health care operations, and government entities other than the City of San Francisco.

All employees who work for a covered employer in San Francisco are entitled to PHEL, regardless of duration of employment or job title, including part-time, temporary, seasonal, and salaried employees.

The only exception for otherwise covered employers is for employees subject to a collective bargaining agreement that expressly waives PHEL in clear and unambiguous terms.

Cleave To The Types Of Leave

Employees can use PHEL in a public health emergency if the employee is unable to work for any of the reasons listed below:

  • Order or Guidelines. A federal, state, or local health ordinance has made a recommendation or requirement related to the public health emergency.
  • Advice from Health Care Provider. A covered employee has been advised to isolate or quarantine by a health care provider.
  • Symptoms. The employee is experiencing symptoms, seeking a medical diagnosis, or has received a positive medical diagnosis for a possibly infectious, contagious, or communicable disease associated with the public health emergency.
  • Caring for a Family Member. The employee is caring for a family member who is subject to an order or has been advised to isolate or quarantine by a health care provider.
  • School Closure or Unavailable Care Provider. The employee is caring for a family member whose school or place of care is closed or whose care provider is unavailable due to the public health emergency.
  • Air Quality Emergency. The employee is diagnosed with heart or lung disease, has respiratory problems, is pregnant, or is at least 60 years old and primarily works outside, and the Bay Area Air Quality Management District has issued a Spare the Air Alert.

An employer of a health care or emergency responder employee may elect to limit the employee’s use of PHEL, but may not prevent the employee from using PHEL if the employee is unable to work due to due to an order or guidelines, is experiencing symptoms as detailed above, or in the event of air quality emergency.

Honeymoon Is Almost Over, And Leave Hours Details Are Here

Employers must provide PHEL to all employees for use beginning on October 1, 2022, and on January 1 of each of the following years. For employees who are not employed on these dates, when a public health emergency commences, the employer must allocate the maximum amount of PHEL available to the employee.

No employee shall receive more than 80 hours of PHEL in a calendar year and employers are not obligated to roll over any unused PHEL to the next year.

Employers must provide PHEL hours as follows:

  • October 1 – December 31, 2022. The allocation must equal or average (depending on the employee’s schedule) the number of hours worked over a one-week period that the employee regularly worked, not to exceed 40 hours.
  • Beginning in 2023 Employees Working Full Time, Regular, or Fixed Schedules. The allocation must be equal to the number of hours the employee regularly works over a two-week period, not to exceed 80 hours.
  • Beginning in 2023 Employees Working a Variable Schedule. The allocation must be equal to the average number of hours the employee worked over a two-week period or since the employee’s start date if after the beginning of the previous calendar year, not to exceed 80 hours.

In addition, beginning on October 1, 2022, and continuing through the remainder of the year, employers may reduce employees’ PHEL allotment if the employee utilizes PHEL for a COVID-related reason that is covered by California’s recently extended COVID-19 supplemental paid sick leave, and if, after October 1, 2022, the employer has a paid leave or paid time off policy for covered reasons that remains in effect. Further, in 2023 and subsequent years, if federal, state, or San Francisco law requires employers to provide paid leave or paid time to address a public health emergency, and employees may use this leave for covered reasons under this ordinance, employers may reduce the amount of PHEL they provide.

The OLSE has the authority under this ordinance to issue other offset provisions if the need arises.

You Got To Belief Employees Can Be Using Leave In Many Circumstances

Employees do not have to steal your heart or your cat to be are entitled to use PHEL, regardless of their length of employment, and they are not obligated to exhaust PHEL before utilizing other paid leave provided by their employers.

An employer also cannot require an employee utilizing PHEL to find a replacement worker to cover the absent employee’s work, nor can they require employees to use PHEL in specific increments.

If an employee is able to telework without increasing the employee’s exposure to disease or unhealthy air quality, the employee may not use PHEL due to an order or guidelines, advice from a health care provider, or in the event of air quality emergency. Teleworking employees may still utilize PHEL for any of the other covered reasons.

Last but not least, employers may require a doctor’s note or other documentation to confirm an employee is part of a vulnerable population and qualifies to use PHEL for an air quality emergency at the time a request is made. The ordinance does not provide any other opportunities for an employer to require or request documentation of a need for PHEL. However, if the employee’s need for PHEL is foreseeable, the employer can require employees to follow reasonable notice procedures.

Married To The Same Compensation And Payroll Requirements

The ordinance uses the same rate of pay calculations as San Francisco’s Paid Sick Leave Ordinance:

  • Employees Exempt From Overtime. Employers pay PHEL in the same manner as they pay other forms of paid leave.
  • Non-Exempt Employees. Employers pay PHEL using either the regular rate of pay for the workweek in which the PHEL is used or by dividing total wages, not including overtime premium pay, by the total hours the employee worked in the pay periods for the 90 days of employment prior to the employee’s use of PHEL.

PHEL payment must be made to employees by the next regular pay period after PHEL is taken. And, employers must provide notice of the amount of PHEL available to each employee in the same way they provide notice of regular California Paid Sick Leave (whether on a wage statement or other writing). If the employer offers unlimited paid leave or paid time off, the employer must note “unlimited” on the employees’ wage statements.

Lastly, employers must keep records documenting the hours worked and PHEL taken for four years.

Notice Requirements

The OLSE has published a new poster, which is available here. The poster should be posted in all available languages in the workplace, and emailed to workers who do not frequent a workplace.

Beware Of The Axe! Enforcement And Penalties For Noncompliance

San Francisco’s OLSE is responsible for enforcement of the ordinance. Any employee may report suspected violations of the ordinance to San Francisco’s OLSE, and the agency may investigate possible violations.

The OLSE can take the following enforcement measures:

  • Award to Employee for Unlawfully Withheld PHEL.If, following an investigation, the OLSE determines that leave was unlawfully withheld, the employee will be awarded an administrative penalty of the dollar amount of PHEL withheld multiplied by three or $500, whichever amount is greater.
  • Additional Award for Discrimination, Retaliation, and Interference. In the event of other violations, such as discrimination, retaliation, interference with an employee’s ability to take leave, and absence control measures, the OLSE may also award restitution, including reinstatement and back pay if applicable.
  • Penalties for Failure to Post PHEL Notice, Provide Agency Access to Records, or Maintain Records.In the event of these types of violations, the OLSE may impose a penalty of $500, which will increase by 50% for each subsequent violation of the same provision by the employer within a three-year period. There is no apparent cap on this penalty.
  • Reimbursement for Investigation and Administrative Costs. The employer may also be required to reimburse the City of San Francisco for the costs of its investigation and administrative enforcement costs.

In addition to the OLSE’s enforcement recourse, the city attorney or any person “aggrieved by a violation” of the ordinance can bring a civil action for an ordinance violation. If the person prevails, they may be awarded legal or equitable relief plus attorneys’ fees and costs.

Workplace Solutions

Employers impacted by San Francisco’s PHEL ordinance should review, and revise if necessary, their leave of absence policies and processes, wage statements, and record keeping policies in advance of October 1, 2022. The authors and your favorite Seyfarth attorneys are always available to help employers navigate the road to compliance.

Edited by Coby Turner

Seyfarth Synopsis: Employers need to be aware and prepare for significant changes to options and rights afforded to employees with respect to their private data and information coming with the California Privacy Rights Act’s (CPRA) January 1, 2023, operative date. Employers will have significant obligations when the grace periods for HR and business to business (B2B) data expire on that date.

Expect The Unexpected

In November 2020, California residents voted to pass the CPRA, which gives California consumers heightened rights and control over their personal information. Until recently, the older privacy statute, the California Consumer Privacy Act (CCPA), has basically been a floater for California employers, with minimal obligations being enforced, as we previously blogged about.

The current obligations are limited to providing employees (or job applicants, contractors, or other workers) with a notice of collection and reasonably safeguarding their personal information, due to a partial exemption under the CCPA for information collected in the context of employment.

But, these privacy protections are about to go from floater status to Head of Household on January 1, 2023, when the partial exemption for employers under the CCPA will expire. Although legislation was proposed to extend the exemption for employers until at least January 1, 2026, the last day on which the California legislature could have passed those bills into law was August 31, 2022—now the business to business (B2B) and HR exemptions have been evicted from the law and employees will be able to leverage their new privacy rights in several new ways, including in the context of disputes.

More Than A Showmance: New Obligations For Covered Employers In 2023 Under CPRA

California employees of covered employers will have increased rights as of January 1, 2023, and accordingly, their employers will have increased compliance obligations. These new rights include, among others:

  1. Right to know: the employee’s right to a notice regarding the type(s) of personal information that their employer collects, sells, shares, or discloses, as well as the right to make a request that the employer to disclose personal information it has collected about the employee;
  2. Right to rectification: the employee’s right to correct or rectify the personal information that their employer maintains;
  3. Right to deletion: the employee’s right to request that the employer delete the personal information that the employer has collected about them;
  4. Right to data portability: the employee’s right to request that their employer provide them with, or transmit to another entity, a copy of their personal information in a reasonable format;
  5. Right to limit use and disclosure of sensitive personal information: the employee’s right to request that their employer limit the use and disclosure of “sensitive personal information” to certain defined activities.

The Power Of Veto

Employers will need to evaluate employee requests to exercise their rights to determine their obligations under the CPRA, as employers have certain bases to deny employee requests.

For example, if an employee wants to exercise their right to deletion, the employer could rightfully deny that request to the extent that certain personal information is required to carry out the employment relationship (to process payroll, provide benefits, etc.). Or, employers could deny the request because of statutory requirements that dictate the retention of certain employment related information, such as demographic and pay information that must be the subject of regulatory reporting.

Also, the right to rectification can also be significantly limited to certain personal information that can be verified. So, while it would be reasonable for an employee to change their address, it may not be reasonable without backup documentation for them to change their Social Security number or taxation information. Employers are also still allowed to utilize data to enable solely internal uses that are reasonably aligned with the expectations of the employee based on their relationship with the employer.

However, in the wake of employee requests, covered employers must keep in mind that the CPRA prohibits discrimination against employees for exercising their rights under CPRA—so be careful if these individuals are selected to go on the block.

How Companies Can Be More Prepared Than A Superfan Or A Veteran

Before year’s end, there are a number of steps that employers should take to prepare for their new obligations. Organizations should consider the following when determining whether they are CPRA ready:

  • Data Inventory: Employers need to assess the locations of personal information, including employee personal information, and create a data inventory.
    • Data inventories are helpful when an employer needs to identify the location(s) of employee data in response to an employee request under CPRA. Importantly, not knowing where the data is held is not an excuse from compliance with a valid request, and an employer can’t delete data if it doesn’t know where it’s located.
    • Employers should inventory not just their own data, but also data held by third party service providers and contractors as these are also components of information required to be communicated when responding to access requests.
  • Records Retention: Employers might also assess their current records retention policies and schedules to ensure that they reflect retention periods appropriate for the states and/or jurisdictions in which they operate. As privacy principles like data minimization and storage retention continue to be adapted and grow, the importance of appropriate records retention is growing in parallel.
  • Review of Existing Practices: Employers should also review their current CCPA notices of collection, as well as current policies and procedures related to privacy and cybersecurity, to determine any changes that should be made under CPRA to address the processing of new or sensitive personal information, the processing of information for new purposes, the length of time the personal information will be maintained, and the categories of third parties that will have employee personal information. Employers with operations outside California should also consider to what extent they will extend these rights to their other employees (even if not currently legally required), especially given we can expect additional laws on the horizon.
  • Vendor Assessment: Employers should review any contracts they maintain with any vendor that processes personal information about their employees and ensure that the contracts meet CPRA requirements, including determining whether they inadvertently share or “sell” employee personal information consequent to the vendor engagement, and whether any exceptions are available. The effort involved in this exercise, including potentially the need to renegotiate contracts, should not be underestimated.

Workplace Solutions

This is a significant change for California employers that may require a re-assessment of how personal data is handled and maintained, policy and procedure changes, or even a complete overhaul of privacy and cybersecurity activities. Wise employers won’t be caught as a have-not and will begin these initiatives now in order to meet the deadlines January 1, 2023, deadline.

Edited by Coby Turner