Seyfarth Synopsis: While targeted social media ads may help employers find potential applicants with specific skill sets, inartfully crafted ads may open the door to discrimination claims, particularly in California.

We’ve already told you about the parade of horribles employers may face when using social media when making hiring decisions.

Well, more social media, more problems.

Micro-Targeting May Open The Door To Discrimination Claims

What is micro-targeting, you ask? Remember when you looked up discount flights to Hawaii, and then for the next three weeks, all of your feeds taunted you with ads for more flights, hotels, surf lessons in Kauai and hula skirts? Well, it’s kind of like that.

Social media platforms collect virtually endless volumes of personal data. This practice enables increasingly intricate advertising algorithms to push out content to very specific demographics. Suppose your business wants to advertise to the select group of people who have expressed an interest in the Montessori method, or who juggle, or who space travel and live in three specific zip codes. Micro-targeting was made for you.

Micro-targeting has expanded into the employment context, with some potentially problematic implications. One class action pending in California federal court alleges that Facebook ads targeted to people within certain age ranges are discriminatory. Similar claims could crop up in seemingly innocuous situations if, for example, an employer targeted ads to fellow graduates of his alma mater, which happened to be an all-male prep school.

As a result, employers who recruit via social media should proceed with caution if their ads in any way target (or exclude) persons in a legally protected category.

Particular Risks for California Employers

Federal law prohibits discrimination based on race, color, national origin, sex, disability, age, citizenship status, and genetic information. Of course, California is a bit different.  California extends its protections to prevent discrimination because of additional characteristics, including ancestry, marital status, sexual orientation, gender identity and expression, medical condition, political activities or affiliations, and military or veteran status. As a result, for example, an ad geared towards trying to recruit politically liberal or conservative candidates may raise peculiar legal issues in California.

Workplace Solutions

Employers need to understand their recruitment practices, and decide whether micro-targeting can ever be the right approach for them. When employers decide to use targeted ads, they should do so with relevant employment laws in mind and take steps to minimize potential exposure. Because HR managers or marketing departments may not be aware of the additional sensitivities that arise when advertising in the employment context (particularly in California), additional training on this subject may be helpful.

If you have any questions regarding your workplace’s online recruitment practices, your favorite Seyfarth attorney is only a few clicks away.

We are pleased to cross-post with our sister blog, Pay Equity Microblog, the following important and timely blog post regarding the latest in California pay equity legislation.

Seyfarth Synopsis: California Governor Brown signed into law yesterday Assembly Bill No. 2282 to clarify previously passed legislation that prohibits inquiries into an applicant’s salary history. Read on for a recap of Assembly Bill No. 2282.

When AB 168 was signed into law in October 2017, California prohibited employers from asking job applicants for “salary history information.” Under this legislation, California employers must provide “applicants” with the “pay scale” for a position upon “reasonable request.” The law was rather unclear, however, about what each of these three terms meant. On July 18, 2018, Governor Brown signed new legislation, Assembly Bill 2282, designed to clarify those terms and other items in AB 168.

For example, under AB 168, it was not clear whether the term “applicant” meant only external applicants for a position or also current employees applying for the position. AB 2282 clarifies that an “applicant” is an individual who seeks employment with the employer, not a current employee.

Next, it was not clear what information an employer would have to supply when a reasonable request was made for the “pay scale” of a position. AB 2282 defines “pay scale” as a salary or hourly wage range and clarifies that the definition of “pay scale” does not include bonuses or equity ranges.

AB 2282 also clarifies what constitutes a “reasonable request” for pay scale information. A “reasonable request” is defined as a request made after the applicant has completed the initial interview.

Additionally, AB 2282 clarifies that although AB 168 prohibits employers from asking for the applicant’s salary history information, employers may ask about an applicant’s salary expectations for the position.

The new legislation addresses aspects of the California Equal Pay Act as well. It was unclear under what circumstances an employer could use prior salary to justify a disparity in pay. The new legislation attempts to clarify this: “Prior salary shall not justify any disparity in compensation. Nothing in this section shall be interpreted to mean that an employer may not make a compensation decision based on a current employee’s existing salary, so long as any wage differential resulting from that compensation decision is justified by one or more of the factors listed in this subdivision.” Those factors are (1) a seniority system, (2) a merit system, (3) a system that measures earnings by quantity or quality of production; and (4) a bona fide factor other than race or ethnicity, such as education, training, or experience.

For Seyfarth’s full 2018 California Legislative Update, please click here.

Seyfarth Synopsis:  The California Fair Employment and Housing Council (“FEHC”) is currently drafting new regulations that define employment practices that constitute discrimination against transgender applicants and employees. On April 7, 2016, the FEHC met in Oakland to discuss and hear public comment on its new, draft proposed regulations, which are in their early stages of development. The next hearing will be on June 27, in Los Angeles.

The DFEH already publishes a guidance document, “Transgender Rights in the Workplace,” defining certain terms and answering employers’ Frequently Asked Questions about transgender employees in the workplace. (See February 24, 2016 Client Alert, “DFEH Issues Guidelines Regarding Transgender Employees”). And the new FEHA regulations that went into effect on April 1, 2016, added protections for transgender employees and applicants. Now, in a further step toward providing direction to employers and to increase protections for transgender workers, the FEHC proposes to amend the FEHA regulations again with proposed Regulations Regarding Transgender Identity and Expression. These will affirmatively require employers to make workplaces non-discriminatory by:

–     Providing “comparable, safe, and adequate” facilities (such as restrooms and locker rooms) to employees without regard to the sex of the employees;

–     Permitting employees to use the facilities that correspond to the employee’s gender identity or gender expression;

–     Using gender-neutral signage on single occupancy facilities under their control; and

–     Addressing and referring to an employee with their preferred name, gender, and pronoun.

Likewise, the proposed regs would expand discrimination against transgender workers beyond overt discrimination, such as failing to hire or terminating a transgender employee. Employers would also be in violation of the FEHA’s prohibition of discrimination against transgender workers by:

–     Requiring an employee to use a particular facility, or undergo or provide proof of any particular medical treatment to use facilities designated for use by a particular gender;

–     Requiring an employee to dress or groom themselves in a manner inconsistent with their gender identity or gender expression;

–     Requiring an applicant or employee to state whether they are transgender;

–     Considering an applicant to have been untruthful by identifying themselves on an employment application in a manner inconsistent with their assigned sex at birth;

–     Enquiring as to or requiring proof of an individual’s sex, gender, gender identity, or gender expression as a condition of employment, unless the employer demonstrates a bona fide occupational qualification or the employee initiates communication with the employer regarding adjustments to their working conditions; and

–     Discriminating against an employee for undergoing a social transition (changing their gender presentation) or a physical transition (receiving medical treatment including hormone therapy or gender reassignment surgeries).

The regulations also propose to revise current regulations regarding Bona Fide Occupational Qualifications, workplace safety, fringe benefits, and working conditions, by replacing binary gender language (i.e., “male” and “female”) with gender neutral language to indicate that the same regulations apply to transgender and gender non-conforming employees and applicants.

These new regulations are scheduled for their next round of public hearing and comment on June 27, 2016. We will provide an update on the latest developments. In the meantime, employers should familiarize themselves and their supervisors with the current guidance and proposed regulations to answer questions they may have about transgender applicants and employees and to understand the emerging standards to avoid liability for discrimination. Attorneys in Seyfarth’s California Workplace Solutions Group are available to help.

Edited by Michael Wahlander.

October 11, 2015, was Governor Brown’s last day to sign bills the California Legislature presented to him following the first year of the 2015-2016 Legislative Session. Below is a summary of what did and did not make Governor Brown’s final cut, and some practical tips for California employers to prepare themselves for compliance with these new California peculiarities.

SIGNED BY THE GOVERNOR

Piece Rate. AB 1513, adding Labor Code section 226.2 and repealing sections 77.7, 127.6, and 138.65, will make it even more difficult for California employers to pay employees on a piece-rate basis. Effective January 1, 2016, employers must pay piece-rate employees for rest and recovery periods (and all other periods of “nonproductive” time) separately from (and in addition to) their piece-rate compensation. Specifically, employers will need to pay the following rates for rest and recovery periods and “other nonproductive time”:

  • Rest and recovery periods. Employers must pay a piece-rate employee for rest and recovery periods at an average hourly rate that is determined by dividing the employee’s total compensation for the workweek (not including compensation for rest and recovery periods and overtime premiums) by the total hours worked during the workweek (not including rest and recovery periods).
  • Other nonproductive time. Employers must pay piece-rate employees for other nonproductive time at a rate that is no less than the minimum wage. If employers pay an hourly rate for all hours worked in addition to piece-rate wages, then those employers would not need to pay amounts in addition to that hourly rate for the other nonproductive time.

Employers must specify additional categories of information on a piece-rate employee’s itemized wage statement: (i) the total hours of compensable rest and recovery periods, (ii) the rate of compensation paid for those periods, and (iii) the gross wages paid for those periods during the pay period. If employers do not pay a separate hourly rate for all hours worked (in addition to piece-rate wages), then the employer must also list (i) the total hours of other non-productive time, (ii) the rate of compensation for that time, and (iii) the gross wages paid for that time during the pay period. Signed October 10, 2015.

PAGA. AB 1506, amending California’s Private Attorneys General Act (“PAGA”) codified in Labor Code sections 2699, 2699.3, and 2699.5, became effective upon the Governor’s signature on October 2, 2015. PAGA, as thus amended, now gives employers a limited right to cure certain wage-statement violations before an aggrieved employee may sue under PAGA. Specifically, an employer can cure violations of the wage-statement statute (Labor Code section 226(a)) with respect to providing either the inclusive dates of the pay period or the name and address of the legal entity that is the employer. An employer can take advantage of this provision only once for the same violation of the statute during each 12-month period.

Employer Liability: Employee Family Member Protected Complaints & Labor Contractor Joint Liability. AB 1509, effective January 1, 2016, amends Labor Code sections 98.6, 1102.5, and 6310 to forbid employers from retaliating against employees for being a family member of an employee who has, or is perceived to have, engaged in activities protected under those Labor Code sections (i.e., generally, making complaints about working conditions or pay, or whistleblowing). The bill also amends Labor Code section 2810.3—added to the Labor Code in January 2015 to impose joint liability on client employers for employees supplied by a labor contractor (our analysis of that law is here)—to exclude from that law client employers that use Public Utilities Commission-permitted third-party household goods carriers, as specified. Signed October 11, 2015.

Expansion of Labor Commissioner Enforcement Authority. AB 970, effective January 1, 2016, amends Labor Code sections 558, 1197, and 1197.1 to authorize the Labor Commissioner to enforce local laws regarding overtime and minimum wage provisions and to issue citations and penalties for violations, provided the local entity has not already cited the employer for the same violation. The bill also authorizes the Labor Commissioner to issue citations and penalties to employers who violate the expense reimbursement provisions of Labor Code section 2802. Signed October 11, 2015.

Labor Commissioner: Judgment Enforcement. SB 588, effective January 1, 2016,  makes various changes and additions to the Labor Code relating to the Labor Commissioner’s enforcement authority. Among other things, it authorizes the Labor Commissioner to file a lien on the employer’s property in California for unpaid wages, and other compensation, penalties, and interest owed to an employee. Signed October 11, 2015.

Industrial Welfare Commission: Wage Orders—Hospital Meal Periods. SB 327 clarifies that existing law regarding a health care employee’s ability to waive voluntarily one of the two meal periods on shifts exceeding 12 hours remains in effect. The bill states that the rules remain the same as they have been since 1993 (as expressly embraced by the Industrial Welfare Commission in 2000). The legislation was adopted to remove any uncertainty caused by the decision in Gerard v. Orange Coast Mem. Med. Ctr., 234 Cal. App. 4th 285 (2015). Signed by the Governor on October 5, 2015, the bill took effect immediately as an urgency measure.

Gender Wage Equality. As we discussed in detail immediately after the Governor’s October 6 signing of SB 358, the bill, effective January 1, 2016, amends Labor Code section 1197.5 to prohibit employers from paying any employee at a wage rate less than that paid to employees of the opposite sex for doing substantially similar work—when viewed as a composite of skill, effort, and responsibility. The new legislation also requires employers to affirmatively demonstrate that a wage differential is based entirely and reasonably upon enumerated factors, such as a seniority system, a merit system, a system that measures earnings by quantity or quality of production, or a bona fide factor that is not based on or derived from a sex-based differential in compensation and that is consistent with a business necessity. The bill contains anti-retaliation provisions and provides a private right of action to enforce its provisions.

Kin Care. SB 579, effective January 1, 2016, amends California’s Kin Care law (Labor Code section 233) to tie its protections to the reasons and definition of “family member” specified in the Healthy Workplaces, Healthy Families Act of 2014 (i.e., paid sick leave law). The bill also expands coverage of California’s school activities leave (Family School Partnership Act, Labor Code section 230.8) to include day care facilities and cover child care provider emergencies, and the finding, enrolling, or reenrolling of a child in a school or day care, and would extend protections to an employee who is a step-parent or foster parent or who stands in loco parentis to a child. Signed October 11, 2015.

Annual E-Verify Bill. AB 622, effective January 1, 2016, adds section 2814 to the Labor Code to prohibit an employer from using E-Verify to check the employment authorization status of an existing employee or an applicant who has not received an offer of employment, except as required by federal law or as a condition of receiving federal funds. Each employer that uses E-Verify in violation of this new section is liable for $10,000 per violation. Signed October 9, 2015.

Paid Sick Leave Amendments. AB 304, signed by the Governor July 13, 2015, and effective on that date, amends provisions of the Healthy Workplaces, Healthy Families Act of 2014 codified in Labor Code sections 245.5, 246, and 247.5. Read our detailed analysis of this legislation.

Accommodation Request as Protected Activity. AB 987, effective January 1, 2016, amends Government Code section 12940 to overturn the interpretation in Rope v. Auto-Chlor Sys. of Washington, Inc., 220 Cal. App. 4th 635 (2013), that an accommodation request is not a protected activity. The Legislature thus intended to clarify that a request for reasonable accommodation based on religion or disability constitutes protected activity. The Fair Employment and Housing Act, thus amended, will now expressly prohibit retaliation and discrimination against a person for requesting accommodation, regardless of whether the request is granted.  Signed July 16, 2015.

Professional Sports Team Cheerleaders as Employees. AB 202, effective January 1, 2016, requires California-based professional major and minor league baseball, basketball, football, ice hockey, and soccer teams to classify and treat cheerleaders who perform during those teams’ exhibitions, events, or games as employees and not independent contractors.

90-Day Retention of Grocery Workers Following Change of Ownership. AB 359 and AB 897, effective January 1, 2016, adds Labor Code sections 2500-2522 to require a “successor grocery store employer” to retain the current grocery workers for 90 days upon the “change in control” of a grocery store. The new law, previously discussed here also imposes specific requirements on the incumbent grocery store. Governor Brown noted in his signing message an ambiguity in how the law applies if an incumbent grocery employer has ceased operations, and noted the author and sponsor have committed to clarify that the law would not apply to a grocery store that has ceased operations for six months or more. The Legislature responded with AB 897, which will exclude from the definition of “grocery establishment” a retail store that has ceased operations for six months or more. AB 897 signed September 21, 2015.

VETOED: BILLS THE GOVERNOR REJECTED (i.e., “it coulda been worse”)

Arbitration and Pre-Employment Waiver Restrictions. As we recently wrote, AB 465 would have added section 925 to the Labor Code to (i) prohibit companies from conditioning employment offers (or renewals) on the waiver of any Labor Code-related right, (ii) require that any waiver of Labor Code protections be knowing, voluntary, and in writing, (iii) deem any waiver of Labor Code rights conditioned on employment to be “involuntary, unconscionable, against public policy, and unenforceable,” (iv) prohibit retaliation against any person who refuses to waive Labor Code-related rights, and (v) authorize an attorneys’ fees recovery for a plaintiff who enforces rights under the newly created section 925. The Governor vetoed the bill on October 11, 2015. His signing statement says that arbitration is not necessarily less fair to employees, and even if it were, Armendariz provides protections for employees in arbitration proceedings. Any remaining abuses should be addressed by targeted, not blanket legislation. And Governor Brown wants to see the outcome of two pending FAA-preemption cases before considering such a broad blanket prohibition.

Other Pay Equity Bills. AB 1017 (enrolled and presented to the Governor September 15) and AB 1354 (enrolled September 10). AB 1017 would have added section 432.3 to the Labor Code to prohibit an employer from seeking salary history information about an applicant for employment. AB 1354 would have amended Government Code section 12990 to require, of each employer with over 100 employees that is or wishes to be a state contractor or subcontractor, a nondiscrimination program that includes policies and procedures designed to ensure equal employment opportunities for all applicants and employees, an analysis of employment selection procedures, and a workforce analysis that contains the total number of workers, the total wages, and the total hours worked annually, within a specific job category identified by worker race, ethnicity, and sex. On October 11, the Governor vetoed both bills. In vetoing AB 1017, he stated we should wait to see if SB 358—the strongest equal pay law in the country—covers the issue, and did not think this bill’s broad prohibition on employers obtaining relevant information would have any effect on pay equity. In vetoing AB 1354, he stated that the DFEH’s current requirements and powers made the legislation unnecessary.

CFRA Leave. SB 406 would have extended the protections of the California Family Rights Act (“CFRA”), Government Code section 12945.2, to care for grandparents, all children (removing any age restriction), and grandchildren, as well as siblings, domestic partners, and in-laws. Vetoed October 11, 2015, because the bill would have created a disparity between FMLA and CFRA.

Athletic Trainers. AB 161 would have made it unlawful and an unfair business practice for any person to use the title of athletic trainer, unless the trainer is certified by the Board of Certification and has completed specified educational or training requirements. Exempt from these provisions were persons who have worked as athletic trainers in California for a period of 20 consecutive years prior to January 1, 2016. AB 161 would have added sections 18898 and 18899 to the Business and Professions Code. Vetoed on September 28,  for the same reasons as the nearly identical measure the Governor vetoed last year—he believes that the conditions set forth in the bill impose unnecessary burdens on athletic trainers without sufficient evidence that changes are needed.

ALRA. AB 561 was this year’s Agricultural Labor Relations Act bill. It would have required the Agricultural Labor Relations Board to process within one year all board orders finding an employer liable for benefits due to unfair labor practices. It also would have required an employer who appeals an order of the Board involving certain awards to employees to post a bond in the amount of the entire value of the order. The Governor vetoed this bill on October 11, because he does not believe the one-year timeline allows for unexpected delays or litigation—even expedited awards take about 18 months. He also noted that, as he did in SB 28 last year, a balanced approach to ALRA enforcement reforms is needed, and encouraged the ALRB to explore internal reforms for more timely awards.

Unemployed. Undeterred by the Governor’s 2014 veto of similar legislation in AB 2271, the Legislature put AB 676 on the Governor’s desk, which would have added section 432.4 to the Labor Code to prohibit employers from publishing an announcement for a job that states or indicates an unemployed person is not eligible for the job, and to prohibit employers from asking applicants to disclose, orally or in writing, the applicant’s current employment status. The Governor vetoed the bill on October 10, because “nothing has changed. I still believe that the author’s approach does not provide a proper or even effective path to get unemployed people back to work.”

Public Employees. AB 883 would have added section 432.6 to the Labor Code to prohibit a state or local agency from discriminating against current or former public employees in publishing job advertisements, in establishing qualifications for job eligibility, and in making adverse employment decisions. The bill would also have prohibited persons who operate job posting websites from publishing any job advertisement or announcement that indicates the applicant must not be a current or former public employee. The bill removed private employers from its scope and removes damages and penalty recovery provisions. Vetoed October 10, 2015.

BILLS THAT FAILED TO MAKE THE FINAL LEGISLATIVE CUT (i.e., “it coulda been a lot worse”)

Minimum Wage Increase. SB 3 would have increased the minimum wage to $11 per hour in 2016 and $13 per hour in 2017. The bill would have also, beginning January 1, 2019, automatically adjusted the minimum wage on each January 1 to maintain employee purchasing power diminished by the rate of inflation in the prior year. Other minimum wage bills on which we previously reported, AB 1007 and AB 669, failed to make it out of the Assembly. This bill, likewise, stalled in appropriations.

Retail Scheduling. The much-feared “Fair Scheduling Act of 2015,” AB 357, based upon the recent San Francisco Retail Workers’ Bill of Rights, was held in the Assembly and ordered inactive in June. Watch for its provisions to reappear in 2016.

OT Exemption. AB 1470 was held in the Assembly at the author’s election. It would have established a rebuttable presumption that employees with gross annual compensation of $100,000 or greater (at least $1,000 per week paid on a salary or fee basis) who regularly perform any exempt duties of an executive, administrative, or professional employee are exempt from overtime pay.

Double Pay on the Holiday Act of 2015. AB 67, Assembly Member Gonzalez’s attempt to require employers to pay employees double pay on Christmas and Thanksgiving, failed passage out of the Assembly. The bill then was ordered to the inactive file by the author.

Workplace Flexibility Act(s) of 2015. AB 1038 would have amended the Labor Code to permit nonexempt employees to request employee-selected flexible work schedules providing for workdays up to 10 hours per day without obligating the employer to pay overtime for those additional hours. The bill did not make it out of its first committee hearing. SB 368 similarly would have allowed a nonexempt employee to request a flexible work schedule up to 10-hour work days, and entitled the employee to overtime for hours worked greater than 10 hours in a work day or 40 hours in a work week.

Voluntary Veterans’ Preference Employment Policy Act. AB 1383 would have amended the FEHA to ensure that none of its nondiscrimination provisions affect the hiring decisions of an employer that maintains a veterans’ preference employment policy established in accordance with the Voluntary Veterans’ Preference Employment Policy Act (Government Code section 12958 et seq.), which this bill would have also created.

Age Information. AB 984, which would have prohibited an employer from using information obtained on a website regarding an employee or applicant’s age in making any employment decision regarding that person, failed in committee.

Unfair Immigration-Related Practices. AB 1065 was also held in committee. This bill would have made it an unlawful employment practice for an employer to request more or different documents than are required under federal law relating to verification that an individual is not an unauthorized alien, or to refuse to honor documents tendered that on their face reasonably appear to be genuine, or to attempt to reinvestigate or re-verify an incumbent employee’s authorization to work unless required to do so by federal law.

Paid Family Leave Benefit Extension. AB 908 would have required the family temporary disability insurance program to provide up to eight weeks, rather than the existing six weeks, of wage replacement benefits to workers who take time off work to care for specified persons, or to bond with a minor child within one year of the birth or placement of the child. This bill also would have required the weekly benefit amount under this program to be calculated using a specified formula.

Workplace Solutions

Follow our Cal Pecs blog www.calpecs.com for more in-depth analysis of how some of the new legislation may affect employers doing business in California.

California State Capitol in Sacramento

The California Legislature adjourned Friday evening, September 11, to close its 2015-16 Legislative Session. It sent a number of employment-related bills to Governor Brown for consideration by his October 11, 2015 deadline to sign or veto the bills. Below is a summary of those before him for consideration, as well as some significant bills he has already signed or that did not make it to his desk. Which private labor and employment bills will the Governor sign into law? We’ll keep you updated…

PENDING BILLS:

Wage and Hour

Piece Rate. AB 1513, if approved, would make it even more difficult for California employers to pay employees on a piece-rate basis. The bill provides that employers must pay piece-rate employees for rest and recovery periods (and all other periods of “nonproductive” time) separately from (and in addition to) their piece-rate compensation. Specifically, the bill would require that employers pay the following rates for rest and recovery periods and “other nonproductive time.”

  • Rest and recovery periods. Employers must pay piece-rate employees for rest and recovery periods at an average hourly rate that is determined by dividing the employee’s total compensation for the workweek (not including compensation for rest and recovery periods and overtime premiums) by the total hours worked during the workweek (not including rest and recovery periods).
  • Other nonproductive time. Employers would have to pay piece-rate employees for other nonproductive time at a rate that is no less than the applicable minimum wage. If employers pay an hourly rate for all hours worked in addition to piece-rate wages, then those employers would not need to pay amounts in addition to that hourly rate for the other nonproductive time.

The bill also would specify additional categories of information that must appear on a piece-rate employee’s itemized wage statement: (i) the total hours of compensable rest and recovery periods, the rate of compensation paid for those periods, and the gross wages paid for those periods during the pay period. If employers do not pay a separate hourly rate for all hours worked (in addition to piece-rate wages), then the employer must also list the total hours of other non-productive time, the rate of compensation for that time, and the gross wages paid for that time during the pay period.

AB 1513 would add Section 226.2 to the Labor Code, and repeal Sections 77.7, 127.6, and 138.65 of the Labor Code. Enrolled on September 16, 2015.

Gender Wage Equality, SB 358, AB 1017, AB 1354. As we recently wrote, there are a few important gender pay equality bills making their way through the Legislature. First, representing what media observers call the nation’s most aggressive attempt yet to close the salary gap between men and women, SB 358 would substantially broaden California gender pay differential law. SB 358 (enrolled and presented to the Governor September 15) would prohibit an employer from paying any employee at a wage rate less than that paid to employees of the opposite sex for doing substantially similar work—when viewed as a composite of skill, effort, and responsibility—and require the employer to affirmatively demonstrate that a wage differential is based entirely and reasonably upon one or more enumerated factors, such as a seniority system, a merit system, a system that measures earnings by quantity or quality of production, or a bona fide factor that is not based on or derived from a sex-based differential in compensation and that is consistent with a business necessity. The bill contains anti-retaliation provisions and provides a private right of action to enforce its provisions.

AB 1017 (enrolled and presented to the Governor September 15) and AB 1354 (enrolled September 10). AB 1017 would add section 432.3 to the Labor Code, to prohibit an employer from seeking salary history information about an applicant for employment. AB 1354 would amend Government Code section 12990 to require, of each employer with over 100 employees that is or wishes to be a state contractor or subcontractor, a nondiscrimination program that includes policies and procedures designed to ensure equal employment opportunities for all applicants and employees, an analysis of employment selection procedures, and a workforce analysis that contains the total number of workers, the total wages, and the total hours worked annually, with a specific job category identified by worker race, ethnicity, and sex.

PAGA. AB 1506 would amend California’s Private Attorneys General Act (“PAGA”), now codified in Labor Code sections 2699, 2699.3, and 2699.5, to give employers a limited right to cure certain wage-statement violations, before an employee may bring a civil action under PAGA. Specifically an employer would be able to cure a violation of the requirement in Labor Code section 226(a) that an employer provide employees with the inclusive dates of the pay period and the name and address of the legal entity that is the employer. The employer would be allowed to take advantage of this provision only once for the same violation of the statute during each 12-month period. The bill’s provisions would become effective immediately upon the Governor’s signing the bill. Enrolled September 11, 2015.

Leaves of Absence

Kin Care. SB 579 would amend California’s Kin Care law (Labor Code Section 233) to tie its protections to the reasons and definition of “family member” specified in the Healthy Workplaces, Healthy Families Act of 2014. The bill also would expand coverage of California’s school activities leave (Family School Partnership Act, Labor Code Section 230.8) to include day care facilities and cover child care provider emergencies, and the finding, enrolling, or reenrolling of a child in a school or day care, and would extend protections to an employee who is a step-parent or foster parent or who stands in loco parentis to a child. Enrolled and presented to the Governor September 8, 2015.

CFRA Leave. SB 406 would extend the protections of the California Family Rights Act (“CFRA”), Government Code Section 12945.2, to care for grandparents, all children (removing any age restriction), and grandchildren, as well as siblings, domestic partners, and in-laws. Enrolled September 16, 2015.

Hiring/Applicants

Unemployed. Undeterred by the Governor’s 2014 veto of similar legislation in AB 2271, AB 676 was introduced and made its way to the Governor’s desk. The bill would add section 432.4 to the Labor Code, beginning July 1, 2016 to prohibit employers from publishing an announcement for a job that states or indicates an unemployed person is not eligible for the job, and from asking applicants to disclose, orally or in writing, the applicant’s current employment status. Enrolled and presented to the Governor September 16, 2015.

Public Employees. AB 883 would add section 432.6 to the Labor Code to prohibit a state or local agency from discriminating against current or former public employees in publishing job advertisements, in establishing qualifications for job eligibility, and in making adverse employment decisions. The bill would also prohibit persons who operate job posting websites from publishing any job advertisement or announcement that indicates the applicant must not be a current or former public employee. The current version of the bill removes private employers from its scope and removes damages and penalty recovery provisions. Enrolled September 14, 2015.

Annual E-Verify Bill. AB 622 would add section 2814 to the Labor Code to prohibit an employer from using E-Verify to check the employment authorization status of an existing employee or an applicant who has not received an offer of employment, except as required by federal law or as a condition of receiving federal funds. The bill would subject each employer that uses E-Verify in violation of this new section to $10,000 per violation. Enrolled and presented to the Governor September 16, 2015.

Other

Employer Liability: Employee Family Member Protected Complaints & Labor Contractor Joint Liability. AB 1509 would amend Labor Code sections 98.6, 1102.5, and 6310, to make it unlawful for an employer to retaliate against an employee for being a family member of an employee who has, or is perceived to have, engaged in activities protected under those Labor Code sections. The bill would also amend Labor Code section 2810.3, which was added to the Labor Code January 1, 2015 to impose joint liability on client employers for employees supplied by a labor contractor (our analysis of that law is here), to exclude from that law client employers that use Public Utilities Commission-permitted third-party household goods carriers, as specified. Enrolled and presented to Governor September 16, 2015.

Expansion of Labor Commissioner Enforcement Authority. AB 970 would amend Labor Code sections 558, 1197, and 1197.1 to authorize the Labor Commissioner to enforce local laws regarding overtime and minimum wage provisions and to issue citations and penalties for violations, provided the local entity has not already cited the employer for the same violation. The bill would also authorize the Labor Commissioner to issue citations and penalties to employers who violate the expense reimbursement provisions of Labor Code section 2802. Enrolled and presented to the Governor September 15, 2015.

Arbitration and Pre-Employment Waiver Restrictions. As we recently wrote, AB 465 would add section 925 to the Labor Code to (i) prohibit companies from conditioning employment offers (or renewals) on the waiver of any Labor Code-related right, (ii) require that any waiver of Labor Code protections be knowing, voluntary, and in writing, (iii) deem any waiver of Labor Code rights conditioned on employment to be “involuntary, unconscionable, against public policy, and unenforceable,” (iv) prohibit retaliation against any person who refuses to waive Labor Code-related rights, and (v) authorize an attorneys’ fees recovery for a plaintiff who enforces rights under the newly created section 925. Enrolled and presented to the Governor September 3, 2015.

Athletic trainers. AB 161 would make it unlawful and an unfair business practice for any person to use the title of athletic trainer, unless the trainer is certified by the Board of Certification and has completed specified educational or training requirements. Exempt from these provisions are persons who have worked as athletic trainers in California for a period of 20 consecutive years prior to January 1, 2016. AB161 would add sections 18898 and 18899 to the Business and Professions Code. Enrolled and presented to the Governor September 16, 2015.

SIGNED BY THE GOVERNOR

Paid Sick Leave Amendments. AB 304. Read our detailed analysis of this legislation and its effect on the Healthy Workplaces, Healthy Families Act of 2014 provisions it amended (Labor Code sections 245.5, 246, 247.5). The bill was signed by the Governor July 13, 2015, and became effective on that date, as Chapter 67 of the Statutes of 2015. AB 11, which would have included in-home support services under the definition of “employees” under the Healthy Workplaces, Healthy Families Act, did not make it out of the Assembly.

Accommodation Request as Protected Activity. AB 987 was intended to overturn any contrary interpretation in Rope v. Auto-Chlor Sys. of Washington, Inc. (2013) 220 Cal. App. 4th 635 that an accommodation request is not a protected activity. By amending Government Code section 12940, the Legislature intended to clarify that a request for reasonable accommodation based on religion or disability constitutes protected activity. With the amendments, the statute, effective January 1, 2016, will expressly prohibit retaliation and discrimination against a person for requesting accommodation, regardless of whether the request is granted. Signed by the Governor on July 16, 2015. Chapter 122 of the Statutes 2015.

Professional Sports Team Cheerleaders as Employees. AB 202 requires California-based professional major and minor league baseball, basketball, football, ice hockey, and soccer teams to classify and treat cheerleaders who perform during those teams’ exhibitions, events, or games as employees and not independent contractors. Adds section 2754 to the Labor Code. Signed by the Governor on July 15, 2015. Chapter 102 of the Statutes 2015.

90-Day Retention of Grocery Workers Following Change of Ownership. AB 359 and AB 897. AB 359 would require a “successor grocery store employer” to retain the current grocery workers for 90 days upon the “change in control” of a grocery store. It also imposes specific requirements on the incumbent grocery store. Look for a separate blog devoted to this important piece of legislation for the grocery industry on www.calpecs.com. Adds §§ 2500-2522 to the Labor Code. Signed by the Governor on August 17, 2015. Chapter 21 of the Statutes 2015.

Governor Brown noted in his signing message an ambiguity in how the law applies if an incumbent grocery employer has ceased operations, and noted the author and sponsor have committed to clarify that the law would not apply to a grocery store that has ceased operations for six months or more. On August 20, Assembly Member Gonzalez gutted and amended AB 897, which previously related to court records, to amend provisions that will be put in place by AB 359 on January 1, 2016 to exclude from the definition of “grocery establishment” a retail store that has ceased operations for six months or more. AB 897 was presented to the Governor on September 15.

BILLS THAT FAILED TO MAKE THE CUT (i.e., “it coulda been worse”)

Minimum Wage Increase. SB 3 would have increased the minimum wage to $11 per hour in 2016 and $13 per hour in 2017. The bill would have also, beginning January 1, 2019 automatically adjusted the minimum wage on each January 1 to maintain employee purchasing power diminished by the rate of inflation in the prior year. Other minimum wage bills on which we previously reported, AB 1007 and AB 669, failed to make it out of the Assembly. This bill, likewise, stalled in appropriations.

Retail Scheduling. The much-feared “Fair Scheduling Act of 2015,” AB 357, based upon the recent San Francisco Retail Workers’ Bill of Rights, was held in the Assembly and ordered inactive in June. Watch for its provisions to reappear in 2016.

OT Exemption. AB 1470 was held in the Assembly at the author’s election. It would have established a rebuttable presumption that employees with gross annual compensation of $100,000 or greater (at least $1,000 per week paid on a salary or fee basis) who regularly perform any exempt duties of an executive, administrative, or professional employee are exempt from overtime pay.

Double Pay on the Holiday Act of 2015. AB 67, Assembly Member Gonzalez’s attempt to require employers to pay employees double pay on Christmas and Thanksgiving failed passage out of the Assembly. The bill then was ordered to the inactive file by the author.

Workplace Flexibility Act(s) of 2015. AB 1038 would have amended the Labor Code to permit nonexempt employees to request employee-selected flexible work schedules providing for workdays up to 10 hours per day without obligating the employer to pay overtime for those additional hours. The bill did not make it out of its first committee hearing. SB 368 similarly would have allowed a nonexempt employee to request a flexible work schedule up to 10-hour work days, and, entitled the employee to overtime for hours worked greater than 10 hours in a work day or 40 hours in a work week.

Voluntary Veterans’ Preference Employment Policy Act. AB 1383 would have amended the FEHA to ensure that none of its nondiscrimination provisions affect the hiring decisions of an employer that maintains a veterans’ preference employment policy established in accordance with the Voluntary Veterans’ Preference Employment Policy Act (Gov. C. Section 12958 et seq.), which this bill would have also created.

Age Information. AB 984, which would have prohibited an employer from using information obtained on a website regarding an employee’s or applicant’s age in making any employment decision regarding that person, failed in committee.

Unfair Immigration-Related Practices. AB 1065 was also held in committee. This bill would have made it an unlawful employment practice for an employer to request more or different documents than are required under federal law relating to verification that an individual is not an unauthorized alien, or to refuse to honor documents tendered that on their face reasonably appear to be genuine, or to attempt to reinvestigate or re-verify an incumbent employee’s authorization to work unless required to do so by federal law.

Paid Family Leave Benefit Extension. AB 908 would have required the family temporary disability insurance program to provide up to eight weeks, rather than the existing six weeks, of wage replacement benefits to workers who take time off work to care for specified persons, or to bond with a minor child within one year of the birth or placement of the child. This bill also would have required the weekly benefit amount under this program to be calculated using a specified formula.

Workplace Solutions

We will continue to monitor and report on these potential sources of annoyance for California employers, as well as any other significant legislative developments of interest. Follow our Cal Pecs blog www.calpecs.com for more in-depth analysis of how some of the new legislation may affect employers doing business in California.