Seyfarth Synopsis: California enacted its Immigrant Worker Protection Act (IWPA) to make it more difficult for federal immigration enforcement agents to access nonpublic areas of employer worksites and private employee records. The U.S. Justice Department, however, recently persuaded a federal district court to issue a preliminary injunction against IWPA provisions that bar employers from voluntarily providing immigration enforcement agents with access to nonpublic worksites and employee records unless federal authorities present a judicial warrant (to access nonpublic worksites) or an administrative or judicial subpoena (to access employee records). In a recent post on Angelo A. Paparelli’s personal blog, the immigration expert extensively analyzes this development and proposes a response that California might pursue.

Angelo argues that the California Attorney General should try to persuade the Federal Court to lift the injunction against these IWPA provisions. He points out that Congress – when passing the Homeland Security Act of 2002 (HSA) – never authorized the relevant civil and criminal immigration enforcement activities. Instead, the HSA requires the relevant agency to focus solely on adjudicating requests for immigration benefits such as work and visitor visas, asylum status, green cards, and U.S. citizenship. Angelo maintains that the U.S. Citizenship and Immigration Services should respect its lack of enforcement authority and stop sending its investigators to California worksites and stop disrupting businesses and workers in the state.

Our readers may be interested in the latest developments concerning California’s sanctuary state laws, and their impact on California employers. Read on for a recent posting on our sister blog: BIG Immigration Law Blog.

Seyfarth Synopsis: The California Legislature, Governor Jerry Brown, and Attorney General Xavier Becerra have aggressively asserted the state’s rights under the U.S. Constitution and traditional police powers to protect all state residents, including undocumented immigrants, from the comparably aggressive immigration enforcement actions of the U.S. Departments of Homeland Security and Justice. This foreseeable clash of federal supremacy versus states’ rights resulted in a recent request by U.S. Attorney General Jeff Sessions in U.S. v.  California for a preliminary injunction against three recent California statutes regulating and reporting on U.S.-California information sharing and the conditions in state detention facilities housing noncitizens (California Assembly Bill AB 103 and Senate Bill SB 54), and limiting the cooperation that California employers may provide to federal immigration enforcement agents (California assembly Bill AB 450). On July 4, 2018 Federal District Judge John A. Mendez issued an order refusing to enjoin AB 103 and SB 54, as well as certain employee-notice rights in AB 450, while granting a preliminary injunction on the rest of AB 450. Proceedings in U.S. v.  California will continue as federal and California authorities continue to clash over other issues such as California’s Evidence-Code ban on disclosure of immigration status in state court proceedings (Senate Bill 785) and federal refusal to provide California with law enforcement grant funding because of its status as a “Sanctuary State.”

The familiar lines were drawn. Combatants clashed in a war of words, competing governance philosophies, conflicting laws, and judicial challenges – all in an age-old constitutional battle of federal power versus states’ rights.

This time around, however, the roles were reversed. Version 2018 is unlike the 1960s when extreme-right southern conservatives, claiming to champion states’ rights, defied but ultimately failed to stop federal efforts to protect civil rights. This time, the state of California passed three statutes under its police powers with the avowed purpose of promoting public safety and protecting undocumented state residents against a determined army of newly-unshackled federal immigration enforcement officers. And this time, the state mostly won.

By enacting three new California laws – Assembly Bills, AB 103 and AB 450, and Senate Bill (SB) 54 – state legislators responded to aggressive federal immigration enforcement activities in the Golden State that they viewed as serious threats to community policing, public safety, and the state’s sizzling, low-unemployment economy.

AB 103 – effective June 27, 2017 – added California Government Code § 12532, directing the state Attorney General to conduct a review and report on county, local, or private locked detention facilities housing noncitizens within the state for civil violations of federal immigration laws. The AG must review and issue a report to the California legislature, Governor and the public by March 1, 2019, and must address conditions of confinement at each facility, due process and care provided to detainees, and the circumstances leading to their apprehension and placement in the facility. To permit this review, AB 103 mandates that the AG be provided with access to each facility, detainees, officials, personnel, and records.

AB 450 – effective January 1, 2018 – the “Immigrant Worker Protection Act” (IWPA), as I wrote in an earlier blog post, “AB 450: California’s Law of Unintended Immigration Consequences” – prohibits California employers (on pain of civil fines) from voluntarily cooperating with federal immigration enforcement agents at the worksite unless cooperation is required by federal immigration law.  Specifically, IWPA prohibits California-based employers from:

  • voluntarily granting immigration enforcement agents access to any non-public areas of a worksite unless the agents present a judicial warrant.
  • voluntarily allowing immigration enforcement agents to access, review, or obtain any employee records unless the agents present a Notice of Inspection (NOI) of Forms I-9 (Employment Eligibility Verifications), an administrative or judicial subpoena, or a judicial warrant requiring compliance.
  • reverifying the employment eligibility of any current employee unless required by federal law.

IWPA also requires employers served with an I-9 NOI to give notice in writing within 72 hours to each current employee at the worksite and any authorized labor union that an I-9 inspection has begun, and notify any affected employee or authorized union rep – again within 72 hours of receiving any subsequent I-9 related federal notices –  “of the obligations of the employer and the affected employee arising from the results of the inspection of I-9 . . . forms or other employment records” (the AB 450 Notice requirements).

Senate Bill (SB) 54 – enacted October 05, 2017, and popularly titled the “California Sanctuary State Law”  – is a comprehensive statute which, among other things, prohibits California law enforcement authorities from sharing a wide variety of information on persons in state custody, including the release date of a detained noncitizen, and from transferring the individual to federal authorities unless he or she has been convicted of certain crimes or unless authorized by a judicial warrant or a judicial probable-cause determination.

Predictably, U.S. Attorney General Jefferson Beauregard Sessions III threw down the gauntlet. The U.S. Justice Department filed a federal complaint in the Eastern District of California, requested a preliminary injunction, offered supporting declarations of senior officials in the State Department (Carl S. Risch) and DHS (Thomas D. Homan, Todd Hoffman and Rodney S. Scott). DOJ attorneys argued to Federal Judge John A. Mendez that these new California laws unconstitutionally usurp federal supremacy and sovereignty over control of the nation’s borders. Not shrinking from the fight, California AG Becerra filed a formal opposition to the request for preliminary injunction, a motion to dismiss the suit, and a legal brief.

Ironically, on Independence Day, Judge Mendez issued his momentous, carefully considered decision (a 60-page whopper), ruling that:

  • No preliminary injunction would issue against AB 103, SB 54, and the AB 450 Notice requirements, because they do not trench upon federal authority over immigration.
  • As for rest of AB 450, California authorities are preliminarily enjoined from:
    • fining employers or otherwise enforcing the bans on reverifying the employment eligibility of current employees,
    • voluntarily giving immigration enforcement agents access to nonpublic areas of the worksite, or
    • allowing them to access, review, or obtain employee records.

Sounding a note of somber exasperation, Judge Mendez implored the two political branches to act:

This Court has gone to great lengths to explain the legal grounds for its opinion. This Order hopefully will not be viewed through a political lens and this Court expresses no views on the soundness of the policies or statutes involved in this lawsuit. There is no place for politics in our judicial system and this one opinion will neither define nor solve the complicated immigration issues currently facing our Nation.

As noted in the Introduction to this Order, this case is about the proper application of constitutional principles to a specific factual situation. The Court reached its decision only after a careful and considered application of legal precedent. The Court did so without concern for any possible political consequences. It is a luxury, of course, that members of the other two branches of government do not share. But if there is going to be a long-term solution to the problems our country faces with respect to immigration policy. it can only come from our legislative and executive branches. It cannot and will not come from piecemeal opinions issued by the judicial branch. Accordingly, this Court joins the ever-growing chorus of Federal Judges in urging our elected officials to set aside the partisan and polarizing politics dominating the current immigration debate and work in a cooperative and bi-partisan fashion toward drafting and passing legislation that addresses this critical political issue. Our Nation deserves it. Our Constitution demands it.

U.S. v. California, Judge Mendez’s case, will continue to final judgment and injunctive orders.  Meantime, however, the federal/California square-off over immigration enforcement is only in the early rounds.  California has just shot additional volleys.

  • The latest California law, SB 785 – enacted with immediate effect on May 17, 2018 – prohibits the disclosure of an individual’s immigration status in open court, unless the party seeking to introduce it first persuades a judge in a private, in camera hearing, that such evidence is relevant and otherwise admissible. SB 785 was enacted in response to recent ICE arrests of immigrants in California courthouses, despite the March 2017 admonition of California Chief Justice, Tani Cantil-Sakauye, AG Sessions and then-Homeland Security Secretary John Kelly, reminding them that:

Our courthouses serve as a vital forum for ensuring access to justice and protecting public safety. Courthouses should not be used as bait in the necessary enforcement of our country’s immigration laws.

  • In State of California, ex rel, Xavier Becerra v. Jefferson B.  Sessions, et al., the state filed a July 9, 2018 motion for summary judgment and legal brief, supported by 13 declarations, requesting a nationwide injunction against imposition of immigration enforcement conditions on federal grants for state and local law enforcement. In a contemporaneous press release, AG Becerra’s office asserted that:

[The U.S. Justice Department has] unlawfully withheld California’s Community Oriented Policing Services (COPS) grant funds, which the State uses to support a task force that combats large-scale drug trafficking. California’s motion seeks to have the court enjoin the federal government’s unlawful conditions for all jurisdictions and compel the issuance of JAG funding to all eligible jurisdictions in the United States that have yet to receive it, as well as to restore COPS funding to California.

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Although Congress apparently has no stomach for comprehensive immigration reform, despite the overwhelming popular view that reform is necessary, the judicial battle between the world’s first and fifth largest economies continues unabated.

Seyfarth Synopsis: Several bills of concern to California employers failed to receive the house of origin blessing and passage by the June 1 deadline, including this year’s attempts at PAGA reform, criminal history inquiries, and medical marijuana accommodations, while a boatload of others, most notably sexual harassment-related bills, sail on. The measures being passed to their opposite house for consideration are described below. 

Friday, June 1, marked the deadline for the state Senate and Assembly to pass bills introduced in their respective houses to the other house. Several employment-related bills (see links at the end of this post) failed to make it out of the house of origin. Many others, detailed below, continue their onward progress toward possible enactment into law. Most notable in number and publicity are the many pending sexual harassment bills. Here’s what is still alive, that we are watching:

Sexual Harassment

AB 1867 would require employers with 50 or more employees to retain records of all internal employee sexual harassment complaints for ten years, and would allow the Department of Fair Employment and Housing (DFEH) to seek an order compelling non-compliant employers to do so. The bill, which would add Section 12950.5 to the Government Code, is scheduled for hearing in the Senate Labor and Industrial Relations Committee on June 13.

SB 1300 would amend the Fair Employment and Housing Act (FEHA) to require a plaintiff who alleges the employer failed to take all reasonable steps necessary to prevent discrimination and harassment to show: (1) the employer knew the conduct was unwelcome, (2) the conduct would meet the legal standard for harassment or discrimination if it increased in severity or became pervasive, and (3) the employer failed to take all reasonable steps to prevent the same or similar conduct from recurring.

This bill would also (a) prohibit an employer from requiring a release of claims or rights under FEHA, or a nondisclosure agreement or other agreement not to disclose unlawful acts in the workplace, in exchange for a raise or a bonus or as a condition of employment or continued employment, (b) require employers, with five or more employees, to provide two hours of sexual harassment prevention training, including bystander intervention training, within six months of hire and every two years thereafter to all California employees—not just supervisors, and (c) prohibit a prevailing defendant from being awarded fees and costs unless the court finds the action was frivolous, unreasonable, or totally without foundation when brought or that the plaintiff continued to litigate after it clearly became so.

SB 1343, which closely resembles SB 1300, would require employers with five or more employees—including temporary or seasonal employees—to provide at least two hours of sexual harassment training to all employees by 2020 and then once every two years thereafter. SB 1343 would also require the DFEH to develop (or obtain) and publish on its website a two-hour interactive online training course on prevention of sexual harassment in the workplace. The bill would also require the DFEH to make the training course, as well as posters, and fact sheets, available in multiple languages (i.e., English, Spanish, Simplified Chinese, Tagalog, Vietnamese, Korean and any other language spoken by “a substantial number of non-English speaking people”).

AB 3080 would prohibit (1) a person from, as a condition of employment or as a condition of entering into a contractual agreement, prohibiting a job applicant, an employee, or independent contractor from disclosing to any person instances of sexual harassment suffered, witnessed, or discovered in the work place; (2) mandatory arbitration of sexual harassment claims; and (3) retaliation against an applicant or an employee who refuses to sign an arbitration agreement. Governor Brown vetoed AB 465 in 2015, which would have prohibited the use of mandatory arbitration agreements as a condition of employment. In his veto message, Governor Brown said he was “not prepared to take the far-reaching step proposed by this bill” and that this sort of blanket ban on mandatory arbitration “has been consistently struck down in other states as violating the Federal Arbitration Act” (FAA). Supporters of AB 3080 have attempted to “preemptively” address such arguments: Floor Analyses cite the ACLU as citing the California Supreme Court’s 2000 Armendariz decision, as well as Civil Code sections 1668 and 3513, to argue that the FAA does not exempt arbitration clauses from general principles that apply to all contracts, and that contracts attempting to exempt people from fraud or illegal activity are unenforceable and against public policy.

AB 3081 would: (1) extend Labor Code prohibitions on discrimination against employees who are victims of domestic violence, sexual assault, or stalking to include employees who are victims of sexual harassment, as well as employees who take time off to assist a family member who is a victim of domestic violence, sexual assault, sexual harassment or stalking; (2) create a rebuttable presumption of unlawful retaliation against an employee if any adverse job action occurs within 90 days of reporting sexual harassment, participating in an investigation, or similar acts; (3) increase the time an employee has to file a complaint with the DLSE for violation of Labor Code section 230 (provides protected time off for jury duty and victims) from one year to three years; (4) require an employer, at the time of hiring and regularly on an annual basis thereafter, to provide to each employee a written notice that includes prescribed information about sexual harassment; and (5) require an employer with 25 or more employees to provide sexual harassment prevention training to all nonsupervisory employees at the time of hire and once every two years thereafter. The bill would also require the Labor Commissioner to create a means for employees to report sexual harassment or assault that occurs in the workplace.

AB 3082 would require the state Department of Social Services (DSS) to develop a policy addressing sexual harassment of in-home supportive services (IHSS) providers and to provide the Legislature with a summary by September 30, 2019. AB 2872 would require the DSS to adopt a peer-to-peer training course for IHSS providers and to ensure that every authorized provider has received at least two hours of peer-to-peer training by December 31, 2019. Beginning January 1, 2020, the bill would require all new or returning IHSS providers to receive at least two hours of peer-to-peer training within their first year of employment.

SB 1038 would make an employee who intentionally retaliates against a person who has filed a complaint, testified, assisted in any proceeding, or opposed any prohibited practice, under FEHA, jointly and severally liable, regardless of whether the employer knew or should have known of that employee’s retaliatory conduct. Previous versions of this bill would have extended personal liability for retaliation, similarly to the liability that already exists for harassment.

AB 2770 would include as “privileged” communications for: (1) complaints of sexual harassment made without malice by an employee to an employer based upon credible evidence; (2) communications between the employer and “interested persons” made without malice regarding the complaint; and (3) non-malicious statements made to prospective employers as to whether a decision to not rehire would be based on a determination that the former employee had engaged in sexual harassment. The bill is scheduled for hearing in the Senate Committee on Judiciary on June 12.

AB 1870 would extend the time an employee has to file an administrative charge with the DFEH alleging an unlawful practice under the FEHA, including, but not limited to, allegations of a sexual harassment, from one year to three years from the alleged incident.

SB 820, the “Stand Together Against Non-Disclosure” (STAND) Act, would make void as a matter of law and public policy provisions in settlement agreements, entered into on or after January 1, 2019, that prevent the disclosure of factual information related to cases involving sexual assault, sexual harassment, sex discrimination, and failure to prevent sex-based harassment and discrimination. The bill would, however, allow such a confidentiality provision to be included upon the request of the claimant unless the opposing party is a government agency or public official; and would allow a provision requiring the monetary settlement payment be kept confidential. Senator Leyva thanked her colleagues when this bill passed the Senate on May 21: “SB 820 shreds the curtain of secrecy that has forced victims to remain silent and empowers them to speak their truth so that we can hopefully protect other victims moving forward.” SB 820 would build on AB 1682, signed into law in 2016, which prohibits confidentiality provisions in settlement agreements in cases involving child sexual abuse or sexual assault against an elderly or dependent adult.

AB 3109 would make void and unenforceable a provision in a contract or settlement agreement, entered into on or after January 1, 2019 that: either (1) waives a party’s right to testify regarding an alleged criminal conduct or sexual harassment by the other party to the contract or agreement in an administrative, legislative, or judicial proceeding; or (2) substantially restrains a party’s right to seek employment or reemployment in any lawful occupation or industry, unless the other party to the contract or agreement is the current or prior employer (except for public employers and a private employer that “so dominates the labor market” so as to effectively restrict the employee from being able to secure employment). The bill is scheduled to be heard in the Senate Committee on Judiciary on June 17.

SB 224 would extend liability for claims of sexual harassment where a professional relationship exists between a complainant and an elected official, lobbyist, director, or producer. This bill (a two year bill introduced in February 2017) has been held at the Assembly desk since January 23, 2018. AB 2338 would require talent agencies to provide to employees and artists, and the Labor Commissioner to provide minors and their parents (prior to issuing the minor a work permit), training and materials on sexual harassment prevention, retaliation, nutrition, reporting resources, and eating disorders. This bill would authorize the Labor Commissioner to charge up to a $25 fee to train each minor, and to impose a $100 fine each time a talent agency fails to provide training, education, or fails to retain specified records. The bill would require a talent agency to request and retain a copy of the minor’s work permit prior to representing a minor.

AB 2079—the “Janitor Survivor Empowerment Act”—would: (1) prohibit the Division of Industrial Relations (DIR) from approving a janitorial service employer’s registration or a renewal that has not fully satisfied a final judgment for certain unlawful employment practices; (2) require the DIR to convene an advisory committee to develop requirements for qualified organizations and peer trainers that janitorial employers must use to provide sexual harassment prevention training; (3) require the DIR maintain a list of qualified organizations and qualified peer trainers and employers to use a qualified organization from the list; and (4) require employers, upon request, to provide an employee a copy of all training materials. AB 2079 builds upon AB 1978 (2016)—the Property Services Workers Protection Act, effective July 1, 2018—which established requirements to combat wage theft and sexual harassment for the janitorial industry.

AB 1761 would require hotel employers to: (1) provide employees with a free “panic button” to call for help when working alone in a guest room that the employee may use, and allow the employee to cease work, if the employee reasonably believes there is an ongoing crime, harassment, or other emergency happening in the employee’s presence; (2) post a notice on the back of each guestroom door informing guests of the panic buttons entitled, “The Law Protects Hotel Housekeepers and Other Employees from Sexual Assault and Harassment”; and (3) provide an employee subjected to an act of violence, sexual harassment or assault, upon request, with time off to seek assistance from law enforcement, legal or medical assistance, and/or reasonable accommodation. The bill would prohibit employers from taking action against any employee who exercises the protections afforded by this bill, and impose a $100 per day penalty, up to $1,000, for a violation of these proposed provisions.

Pay Equity

SB 1284, as presently drafted, is a less onerous version of last year’s effort to mandate annual reporting of pay data a la EEO-1. The bill would require, on or before September 30, 2019, and each year thereafter, that private employers with 100 or more employees submit a pay data report to the DIR. If enacted, the law would require employers to include in the report the following for each establishment, and a consolidated report for all establishments:

  1. The number of employees by race, ethnicity, and sex in the following categories: all levels of officials and managers, professionals, technicians, sales workers, administrative support workers, craft workers, operatives, laborers and helpers, and service workers; and
  2. The number of employees by race, ethnicity and sex whose earnings fall within each of the pay bands used by the US Bureau of Labor Statistics Occupation Employment Statistics Survey, determined by each employee’s total earnings for a 12-month look-back period, including total hours worked by each employee for part-time/partial-year employment.

Employers that are required to submit the EEO-1 Report could instead submit that report to the DIR. The DIR would maintain the reports for 10 years and make the report available to the DFEH upon request. Non-compliant employers would be subject to a $500 civil penalty for the initial violation and $5,000 for each subsequent violation as well as citation by the Labor Commissioner. The bill would prohibit the DIR and DFEH from publicizing any individually identifiable information obtained through this process but authorize the DIR or the DFEH to develop and publicize aggregate reports based on the information received that are reasonably calculated to prevent association of any data with any business or person.

This year’s Fair Pay Act bill, AB 2282, attempts to clarify some ambiguities in Labor Code sections 432.3 and 1197.5 created by prior pay equity legislation, AB 1676 (2016) and AB 168 (2017). AB 2282 would clarify that “pay scale” means a “salary or hourly wage range,” that “reasonable request” by an employee for a position’s pay scale means “a request made after an applicant has completed an initial interview with the employer,” and that “applicant” or “applicant for employment” means an individual who is seeking employment with the employer and is currently not employed with that employer in any capacity or position. The bill provides that nothing in section 432.3 prohibits an employer from asking an applicant about his/her salary expectation, and that nothing in section 1197.5 should be interpreted to prohibit an employer from making a compensation decision based on a current employee’s existing salary as long as any wage differential resulting from that compensation decision is justified by one or more of the factors specified in the statute. AB 2282 is scheduled for hearing in the Senate Committee on Labor and Industrial Relations on June 13.

Pay Statements: SB 1252 would amend Labor Code section 226 to grant employees the right “to receive” a copy of (not just inspect) their pay statements. This bill is scheduled for hearing on June 20 in the Assembly Committee on Labor and Employment.

Port Drayage Carriers: SB 1402 would require the DLSE to create and post a list on its website of “bad actor” port drayage motor carriers, i.e., companies with any unsatisfied judgments or assessments, or any “order, decision, or award” finding illegal conduct as to various wage/hour issues, including independent contractor misclassification and derivative claims. This bill would extend joint and severable liability to those companies’ customers for future wage violations of the same nature by those drayage motor carriers. This bill is part of a very broad and multi-pronged attack on port drayage motor carriers serving the LA and Long Beach ports, mainly regarding alleged independent contractor misclassification of drivers.

Lactation Accommodations: AB 1976 would ensure employers’ already-required reasonable efforts to provide a room or location for lactation consists of providing something other than a toilet stall or bathroom (by deleting “toilet stall” and inserting “bathroom” in the statute). This bill is scheduled for hearing in the Senate Committee on Labor and Industrial Relations on June 13. SB 937 would more substantively change existing lactation accommodation requirements, by requiring a lactation room to be safe, clean, and free of toxic or hazardous materials, contain a surface to place a breast pump and personal items, contain a place to sit, and have access to electricity. The bill would exempt employers with fewer than 50 employees that can show that the requirement would impose an undue hardship by causing significant expense or operational difficulty when considered in relation to the employer’s size, financial resources, or structure.  SB 937 would allow employers to designate a temporary lactation location, instead of providing a dedicated room, due to operational, financial, or space limitations. SB 937 would require employers to develop and implement a new lactation accommodation policy describing an employee’s right to a lactation accommodation, how to request an accommodation, the employer’s obligation to respond to the request, and the employee’s right to file a complaint with the Labor Commissioner. The bill would also require employers to maintain accommodation request records for three years and to allow the Labor Commissioner access to the records. The bill would require the DLSE to create and make available a model lactation policy and model lactation accommodation request form on the DLSE website, as well as lactation accommodation best practices. The bill would deem a denial of reasonable break time or adequate lactation space a failure to provide a rest period in accordance with Labor Code section 226.7.

Paid Family Leave: 2017 legislation effective January 1, 2018, removed the seven-day waiting period before an eligible employee may receive family temporary disability benefits (under the paid family leave program, which provides wage replacement benefits to workers who take time off work to care for a seriously ill family member or to bond with a minor child within one year of birth or placement). AB 2587 would remove the requirement that up to one week of vacation leave be applied to the waiting period, consistent with the removal of the seven-day waiting period for these benefits.  This bill is scheduled for hearing in the Senate Committee on Labor and Industrial Relations on June 13.

Criminal History: SB 1412, the sole criminal history bill of four still alive, would allow employers to inquire into a job applicant’s particular conviction, regardless of whether that conviction has been judicially dismissed or sealed, under these specified conditions: (1) the employer is required by federal law, federal regulation, or state law to obtain information about the particular conviction, (2) the job applicant would carry or use a firearm as part of the employment, (3) the job applicant with that particular conviction would be ineligible to hold the position sought, or (4) the employer is prohibited from hiring an applicant who has that particular conviction.

Mediation Confidentiality: SB 954 would require that, except in the case of a class action, before engaging in a mediation or mediation consultation, an attorney representing a client participating in a mediation or a mediation consultation must provide the client with a written disclosure containing the mediation confidentiality restrictions provided in the Evidence Code. The bill would require the attorney to obtain a written acknowledgment signed by the client stating that the client has read and understands the confidentiality restrictions. However, an agreement prepared during a mediation would remain valid even if an attorney fails to comply with the disclosure requirement. The bill would also add to the mediation privilege of Evidence Code section 1122 any communication, document, or writing that is to be used in an attorney disciplinary proceeding to determine whether an attorney has complied with the above requirements, and does not disclose anything said or done or any admission made in the course of the mediation.

Immigration Status: AB 2732 would make it illegal—and subject to a $10,000 penalty—for an employer to knowingly destroy or withhold any real or purported passport, other immigration document, or government identification, of another person, in the course of committing trafficking, peonage, slavery, involuntary servitude, a coercive labor practice, or to avoid any obligation imposed on the employer by the Labor Code. This bill would require an employer to post a workplace notice stating the rights of an employee to maintain custody of the employee’s own immigration documents, that the withholding of immigration documents by an employer is a crime, and “If your employer or anyone is controlling your movement, documents, or wages, or using direct or implied threats against you or your family, or both, you have the right to call local or federal authorities, or the National Human Trafficking Hotline at 888-373-7888.”. Further, the bill would require an employer to provide employees with the “Worker’s Bill of Rights,” to be developed by the DIR by July 1, 2019, which would inform employees of the same rights.  Employers would be required to have employees sign the “Worker’s Bill of Rights” and maintain the records for at least three years.

SB 785, which the Governor signed and went into effect immediately May 17, 2018 (to sunset on January 1, 2020), prohibits the disclosure of an individual’s immigration status in open court in a civil or criminal action unless the party wishing to disclose the information requests a confidential in camera hearing and the judge deems the evidence relevant and admissible.

Bills that failed… for now:

The following bills did not survive the house of origin deadline or were struck down prior to the deadline. See our prior legislative update for summaries of these bills.

AB 2016 (PAGA); AB 2482 (Flexible Work Schedules); AB 2946 (DLSE Complaints extension); AB 2366 (Victims of Sexual Harassment); AB 1938 (Familial Status Inquiries); AB 2223 and AB 2613 (Wage Statements); AB 2069 (medical marijuana reasonable accommodation); AB 2841 (paid sick leave increase); AB 2680, SB 1298, AB 2647 (criminal history inquiries).

Stay tuned for our next Legislative update coming around the August 31st deadline for bills to pass both houses and make their way to the Governor’s office.

Seyfarth Synopsis: California’s new law, Assembly Bill 450, signed by Governor Brown on October 5, and effective January 1, 2018, imposes several new immigration-related duties on California employers and the potential for civil fines. AB 450 will require employers to understand or seek guidance on where the new law ends and federal immigration law begins. The complexities of U.S. immigration law make drawing this distinction very difficult. This blog post provides an in-depth analysis of foreseeable challenges California employers – whether or not they petition for foreign workers – will likely face.

“Mollusks of Jargon”

The California legislature and Governor Jerry Brown have once again entered the immigration fray.

This foray is not about its Sanctuary State legislation, recently enacted, and promptly decried by U.S. Attorney General Jefferson Beauregard Sessions III as “unconscionable”, and by Thomas Homan, Acting Director of U.S. Immigration and Customs Enforcement (ICE), as “[forcing his] hand,” and causing him to “quadruple workplace crackdowns.”

No, the latest California leap into the federal immigration ecospace is Assembly Bill 450, which imposes civil fines on employers ranging from $2,000 to $10,000 per violation for a variety of newly unlawful practices. Signed by Gov. Brown on October 5, 2017, AB 450 stands among a slew of new California laws taking effect on January 1, 2018. AB 450 will add three new sections to the Government Code and two new sections to the Labor Code – 90.2 and 1019.2.

Under the new law, every public and private employer in California, or any person acting on the employer’s behalf, must:

No Fourth Amendment Waiver 

Refrain from waiving Fourth Amendment protections against unreasonable searches and seizures by:

  • granting voluntary consent to enter any non-public areas at a place of labor, except if presented with “a judicial warrant,”
  • granting voluntary consent to an immigration enforcement agent to access, review, or obtain the employer’s employee records without “a subpoena or judicial warrant,” except if an “immigration agency” (most often, this would be Homeland Security Investigations [HSI], an agency of U.S. Immigration & Customs Enforcement [ICE]) issues a Notice of Inspection (NOI) of Employment Eligibility Verification Form I-9s and other records required to be maintained under federal immigration regulations in order to verify employment eligibility;

Posted Notice of Worksite Inspection

 Post a notice at the worksite in the language the employer normally uses to communicate employment-related information to employees, within 72 hours of receiving an NOI, communicating the following information to employees:

  1. An immigration agency, identified by name, has issued an NOI (a copy of which must also be posted at the same time) and will conduct inspections of I-9 forms or other employment records.
  2. The date that the employer received the NOI.
  3. The “nature of the inspection” to the extent known.

Notice to the Union

Give written notice to the “employee’s authorized representative,” namely, the exclusive collective bargaining representative, if any, within 72 hours of the immigration agency’s issuance of an NOI:

  • Delivery of Requested Copy of the Notice. Provide any employee, upon reasonable request, with a copy of the NOI;
  • Provide Notice of Suspect Documents. Within 72 hours of the employer’s receipt of a written immigration agency notice informing the employer of the results of the agency’s inspection of the I-9s and the employer’s employment records, typically entitled, a “Notice of Suspect Documents” (NSD), provide a written notice to certain “affected employees” who apparently lack work eligibility (and any collective bargaining representative) of the obligations of the employer and the affected employees, containing the following information:
  1. A description of any and all deficiencies or other items identified in the written immigration inspection results notice related to the affected employee.
  2. The time period for correcting any potential deficiencies identified by the immigration agency.
  3. The time and date of any meeting with the employer to correct any identified deficiencies.
  4. Notice that the employee has the right to representation during any meeting scheduled with the employer.

No Re-Verifying Current Employees

 Refrain from re-verifying the employment eligibility of a current employee at a time or in a manner not required by the employment eligibility verification provisions of the Immigration Reform and Control Act of 1986, 8 USC § 1324a(b), or that would violate any E-Verify Memorandum of Understanding the employer has entered into with the Department of Homeland Security.

* * *

To be sure, AB 450 offers sops feigning fealty to federal immigration law. Replete in the law are exceptions stating that these new mandates are not to be interpreted as requiring the employer to violate federal immigration law. California’s political leaders apparently believe that U.S. immigration rules – in the aspirational words of the Fifth Circuit court federal Court of Appeals – are “comprehensible by intelligent laymen and unspecialized lawyers without the aid of both lexicon and inner-circle guide.”

Regrettably, they are anything but. The court said in this 1981 decision in words that ring ever more true today:

Whatever guidance the [immigration] regulations furnished to those cognoscenti familiar with procedures, this court . . . finds that they yield up meaning only grudgingly and that morsels of comprehension must be pried from mollusks of jargonKwon v. INS, 646 F. 2d 909 (5th Cir., 1981). (Emphasis added.)

AB 450’s supporters, the California Labor Federation and Service Employees International Union, defend the law because it adds what they apparently see as reasonable but necessary burdens on employers in order to protect the state’s sizable population of undocumented employees from immigration raids and the abusive practices of some employers:

“[M]illions of union members are immigrants and worksite immigration raids undermine workers’ rights in significant ways: they drive down wages and labor conditions for all workers, regardless of immigration status; they interfere with workers’ ability freely to exercise their workplace rights; they incentivize employers to employ undocumented workers in substandard conditions because the threat of immigration enforcement prevents workers from complaining; they undermine the efforts of the state to enforce labor and employment laws.”

However laudable this legislative goal, AB 450 would be better titled, the “Have Your Immigration Lawyer on Speed Dial Act,” because that is how this new law will likely play out. This is probably why the Society for Human Resource Management (SHRM) steadfastly opposed AB 450, stating:

“[W]hile well intentioned, [AB 450] will add a host of unnecessary burdensome requirements, create many logistical challenges, and could possibly force human resource professionals to decide between abiding by federal law or state law.”

Consider some of the issues this new law will raise.

Role of California state courts to interpret federal immigration laws? AB 450 grants the California Labor Commissioner or the state’s Attorney General the exclusive authority to initiate civil actions to enforce its provisions. Assuming that the courts find that this law can peacefully coexist with Congress’s plenary authority over immigration law, then presumably California state administrative officials and courts will now be required to decide whether or not particular actions by employers are “required” by federal immigration law.

Distinguishing between a subpoena and a judicial warrant? AB 450 permits employers to grant federal immigration officers access to non-public worksite areas if the employer is presented with a “judicial warrant.” Access to a company’s employee records, however, is not prohibited under the law if immigration officers tender to the employer a “subpoena or judicial warrant.” Few employers likely realize, however, that a subpoena may be issued by a court or by administrative agency officials.

Under Immigration and Nationality Act § 235(d)(4); 8 U.S.C. §1225(d)(4), immigration officers are empowered to issue administrative subpoenas for books and records. If an employer refuses to comply with an administrative subpoena, however, then immigration officials can only enforce it if they persuade a federal judge to issue a judicial order. Yet – in the real world – when federal immigration agents issue an administrative subpoena carrying an official federal seal and, by its terms, demanding access to business records, pity the unsophisticated HR manager who violates California law if s/he “voluntarily” provides the business’s employee records.

Who are “immigration enforcement agents?” AB 450 does not define the term “immigration enforcement agent.” The phrase undoubtedly refers to officers of ICE and HSI. Less clear is whether other federal immigration officers should be characterized as immigration enforcement agents under this law. Federal officers with immigration enforcement authority — all of whom have taken an oath to “well and faithfully discharge [their] duties” — may hail from any number of Executive Branch departments and agencies. Under 8 CFR § 1.2, USCIS has set forth a broad definition of DHS employees who are designated by regulation as “immigration officer[s].” These include: “immigration enforcement agents, forensic document analysts, immigration agents (investigations), immigration enforcement agents, immigration inspectors, immigration officers, immigration services officers, investigator, intelligence agents, intelligence officers, investigative assistants, and special agents, among others.”

Conceivably, AB 450, by its terms, could also extend to federal officials performing immigration functions within the Departments of State, and Labor. Moreover, the current practice of one Department of Homeland Security  (DHS) sub-component, the Fraud Detection and National Security (FDNS) Directorate of United States Citizenship and Immigration Services (USCIS), to conduct unannounced “administrative site visits” or “on-site compliance reviews,” raises immediate concerns about its officers’ future interactions with California employers.

Although FDNS asserts that it is not an immigration enforcement agency, a current job opening for the position, “Immigration Officer (FDNS),” – accessible here, and if the posting is taken down, also here – confirms that, “[every] day, our Immigration Officers (FDNS) . . . identify, articulate, and pursue suspected immigration benefit fraud.” Moreover, employers seeking to hire foreign workers must sign petitions under penalty of perjury for virtually every request for immigration benefits submitted to USCIS, requests which contain the acknowledgment, “I also recognize that any supporting evidence submitted in support of this petition may be verified by USCIS through any means determined appropriate by USCIS, including but not limited to, on-site compliance reviews,” see e.g., the Petition for a Nonimmigrant Worker (Form I-129 Part 7, p. 6).

Indeed, the tasks of immigration site inspectors, according to FDNS, are to:

  • Verify the information, including supporting documents, submitted with the petition;
  • Verify that the petitioning organization exists;
  • Review public records and information on the petitioning organization;
  • Conduct unannounced site visits to where the beneficiary works;
  • Take photographs;
  • Review documents;
  • Speak with the beneficiary [the nonimmigrant worker sponsored under an employment-based petition by an employer]; and
  • Interview personnel to confirm the beneficiary’s work location, physical workspace, hours, salary and duties. (Emphasis added.)

The conceit asserted by FDNS that it is not an immigration enforcement agency is also belied by this disclosure on its website:

USCIS has formed a partnership with Immigration and Customs Enforcement (ICE), in which FDNS pursues administrative inquiries into most application and petition fraud, while ICE conducts criminal investigations into major fraud conspiracies. (Emphasis added.)

Even if a line can fairly be drawn between FDNS’s pursuit of immigration fraud and ICE’s activities in conducting criminal investigations, the use by AB 450 of the term, “immigration enforcement agent,” suggests at the very least an agency relationship between FDNS (the agent) and ICE (the principal).

Thus, a California employer could well face liability under AB 450 if it voluntarily consents to an FDNS officer’s request for access to the beneficiary’s “physical workspace,” the opportunity take to “take photographs” of the workspace (which routinely happens), and conduct a “[r]eview [of] records.” Yet, if a California employer were to refuse such a request, FDNS officers will no doubt report that refusal to USCIS adjudicators, who then routinely issue a notice of intent to deny or revoke work-visa petition approval. Notices of intent to revoke approval are especially problematic, because if they cannot be overcome in light of the obvious state law impediments in AB 450, then USCIS will revoke the employment authorization of the particular beneficiary. The result of a revocation is that the employee must be terminated upon the employer’s receipt of the notice of revocation, and that termination may constitute a failure on the part of the beneficiary to maintain lawful nonimmigrant status, which itself would trigger an obligation to depart the United States immediately with his or her immediate family members, or face removal from the United States at a hearing initiated by ICE before an Immigration Judge.

These problems become even more complicated if the employer provides facilities for its own workers and for the employees of any of its contractors, consultants, staffing companies, or vendors. While AB 450 does not prohibit a California employer from voluntarily sharing whatever information it might possess about the employees of its contractors, this new law, by its terms, mandates, on penalty of civil fine, that the employer refuse to grant voluntary consent to “enter any non-public areas at a place of labor” – apparently irrespective of the party employing the particular workers at the place of labor. Such a refusal likewise under current USCIS practice would lead to a similarly insurmountable notice of revocation, thereby terminating the employment authorization and nonimmigrant status of a contractor who was the subject of an FDNS unannounced site visit, and conceivably, resulting in a breach of contract by the customer for precluding the vendor from fulfilling the object of the contract, i.e, the rendition of contractually-agreed services.

Good faith immigration compliance and voluntary internal audits? DOJ and DHS component agencies encourage employers to voluntarily conduct internal immigration-compliance audits, and prescribe procedures to (a) correct I-9 paperwork errors, and (b) reasonably investigate circumstances suggesting that an employee may lack employment authorization. Such audits sometimes require the cooperation of current employees, as, for example, if corrections must be made to the employee portion of the I-9, Section 1, or if the employer suspects that the documents of identity and employment eligibility that the employee previously presented may not be genuine.

Given that AB 450 prohibits reverifying a current employee’s eligibility to work in the United States, should California employers defensively adopt “head in the sand” policies to preclude or discourage voluntary immigration compliance audits? The answer will depend on the employer’s business circumstances and employment practices in the particular industry. It may also turn on whether an employer has become aware of facts or credible assertions that call into question the employment eligibility of one or more employees.

Under the constructive-knowledge rule, an employer will be deemed to know whatever could have been discovered if a reasonable investigation had been conducted. Thus, if an employer declines to investigate suspicious circumstances suggesting unauthorized employment, ICE can maintain that an employer has violated federal law because company officials should have known that the business had hired or continued to employ a worker while aware that the individual had no right to be employed in the United States. Consequently, as SHRM feared, AB 450 will “force human resource professionals to decide between abiding by federal law or state law.”

Unintended harm to workers, their unions, and business operations? While the constructive-knowledge rule, in effect, requires an employer to conduct a reasonable investigation, the rule does not dictate the speed of the investigation. In past ICE investigations, some field offices have expressly allowed an employer time to respond to an NSD by phasing-in the duration of time when workers whose employment eligibility has been questioned must reverify their employment eligibility. A compliance phase-in would give the employer time to reverify its challenged employees in tranches. Without internally posting a notice to employees that ICE has begun in I-9 investigation, an employer granted phase-in permission by ICE would (a) privately and without fanfare reverify the employment eligibility of its most recently hired or least skilled workers, (b) speedily hire replacements (who would quickly be trained by employees with longer tenure or greater expertise in the operations of the business), and (c) then reverify the most senior or essential workers.

In this way, employers could conduct a constructive-knowledge investigation sequentially over time, business operations could continue with less disruption, the most valued employees could continue in employment for the time being, and unions would continue to receive dues payments, while retaining the ability to negotiate severance packages for terminated employees.

What, then, is the likely outcome of AB 450’s requirement that the employer give public notice within 72 hours to all employees and the local union that ICE has served a NOI? Today, many employers have found that when employees learn of an ICE worksite investigation, they quickly disappear for fear of arrest and deportation. Leaving the employer in the lurch, an unknown number of undocumented workers merely purchase new identities and forms of work permission on the street – documentation that, with the increasing sophistication of counterfeiters, will appear to be genuine, and thus be used to get a new job with the next employer. And so the cycle continues. Rinse and repeat. Consequently, the 72-hour NOI notice requirement in AB 450 will likely only serve to disrupt businesses and prompt undocumented workers to switch jobs, while shrinking the duration and amount of dues payments to unions.

A bonanza for translators? AB 450 requires employers, within 72 hours of receiving an NOI, to post a notice at the worksite in the language the employer normally uses to communicate employment-related information to employees, announcing that ICE has served an NOI on the employer, and providing other required details. Although not clearly phrased, the posting obligation seems to include the duty to provide a translation of the NOI itself into the language(s) ordinarily used to communicate with employees.

California is a state that prides itself on its diversity, which necessarily entails a noncitizen population speaking a multiplicity of languages. Many workers in the state do not speak English well, but do speak a native language, be it Spanish, Chinese, Tagalog, Vietnamese, Armenian, Khmer, Farsi, or Russian, among others.

Heaven forbid – for example – that ICE serves an NOI on a Friday. This will likely leave many an employer scrambling first to draft the AB 450 notice, and then to find weekend translators capable of quick turnaround to produce the required translations. Perhaps competent translators can be found, but probably only at a premium price for speedy, afterhours delivery.

The drafters of the legislation apparently did not realize, however, that ICE officers are usually quite willing to extend its own 72-hour regulatory deadline by a week or two for an employer to turn over its I-9s and other required records, or even longer, if the employer can provide a reasonable explanation for its inability to satisfy the 72-hour rule.

California lawmakers made no provision for extension of the posting deadline in AB 450. It therefore doesn’t take a Hollywood scriptwriter to visualize how this might play out:

(Scene 1) Mid-day on a Friday afternoon, ICE serves the employer with the NOI,

(Scene 2) As the weekend is about to begin, the employer scrambles to find a lawyer begins who will help word the AB 450 notice,

(Scene 3) At the same time, the employer scrambles to locate translators to prepare translations into multiple relevant languages,

(Scene 4) On Monday afternoon, just hours before the 72-hour deadline in AB 450, the employer posts the translations on the employee bulletin board,

(Scene 5) Later that afternoon, the workers read the posting, interpret it as a “run notice,” and flee the building,

(Scene 6) Minutes later, ICE officers – aware of the California statutory deadline – are already poised in the parking lot to apprehend the fleeing workers and process them for deportation, and

(Scene 7) Tuesday morning, the factory is idle and quiet, except for the angry voices of union bosses complaining to management about unfair labor practices.

* * *

AB 450 is not the first California encroachment on federal immigration law, and not likely the last. As the courts, federal immigration agencies, and the NLRB are left to sort out federal from state legal rights and duties amid the detritus of this law, California politicians will likely be at it again, concocting new immigration laws, while figuratively quoting a former governor’s thespian line: “[We’ll] be back!”

Seyfarth Synopsis: New statutory obligations for California employers in 2018 will include prohibitions on inquiries into applicants’ salary and conviction histories, expanding CFRA to employees of smaller employers, expansion of mandatory harassment training to include content on gender identity, gender expression, and sexual orientation, and new immigration-related restrictions and obligations.

California Governor Jerry Brown spent his last day to sign bills in this Legislative Session, October 15, approving and rejecting a number of employment-related bills. Below is our annual summary of those bills that will have—or would have had—the greatest impact on California employers. All approved bills become effective January 1, 2018, unless stated otherwise. Watch this blog for in-depth pieces on the bills below that will pose the most challenges for employers.

APPROVED

Salary Inquiry Ban. After two unsuccessful attempts, AB 168 received the Governor’s approval to make it unlawful in California law for employers, including state and local governments, to ask applicants about their prior salary, compensation, and benefits. The employer may consider prior salary information the applicant voluntarily and without prompting discloses, in setting pay. Don’t forget that Labor Code section 1197.5 already prohibits an employer from using an applicant’s salary history, by itself, to justify a pay disparity. AB 168 will also require employers to provide the position’s pay scale to a job applicant upon reasonable request. Read our in-depth piece on AB 168, and practical implications, here. Adds Section 432.3 to the Labor Code.

Meanwhile, yesterday the Governor vetoed the other pay equity bill we were watching, Gender Pay Gap Transparency Act, AB 1209. More on that bill below.

Ban-the-Box: Prior Conviction History of Applicants. With the approval of AB 1008, the Governor and California Legislature have created yet another protected class of individuals entitled to sue employers under the Fair Employment and Housing Act: applicants denied employment because of their conviction history, where the employer is unable to justify relying on that conviction history to deny employment. AB 1008 makes it unlawful for an employer to include questions seeking disclosure of an applicant’s criminal history on any employment application, inquire or consider the conviction history of an applicant before extending a conditional offer employment, or consider or distribute specified criminal history information in conducting a conviction history background check. If an employer intends to deny a position solely or in part because of the applicant’s prior conviction, the employer must make an individualized assessment of whether the applicant’s conviction history has a direct and adverse relationship with the duties of the job, consider certain topics, and allow the applicant to dispute the accuracy of the conviction history. Read our in-depth analysis, implications, and tips, of the “Scarlet Letter Act” here. Adds Section 12952 to the Government Code, and repeals Section 432.9 of the Labor Code.

New Parent Leave Act and Parental Leave DFEH Mediation Pilot Program. SB 63 extends CFRA’s protections to smaller employers (with at least 20 employees within 75 miles) and prohibits those employers from refusing to allow employees—with more than 12 months and at least 1,250 hours of service—to take up to 12 weeks of parental leave to bond with a new child within one year of the child’s birth, adoption, or foster care placement. An employer employing both parents who both are entitled to leave for the same child does need not give more than 12 weeks of leave total to the employees (which may be granted simultaneously if the employer chooses). Further, an employer can recover the costs of maintaining the health plan for employees that do not to return to work after their leave exhausts because of a reason other than a serious health condition or other circumstances beyond the employee’s control. Beginning January 1, 2018 and ending January 1, 2020, the DFEH, after receiving funding from the Legislature, will create a parental leave mediation pilot program under which an employer may request all parties to participate in mediation within 60 days of receiving a right-to-sue notice. This bill prohibits an employee from pursuing any civil action under these provisions (and tolls the statute of limitations) until the mediation is complete, meaning when either party elects not to participate, withdraws from mediation, or notifies the DFEH that further mediation would be fruitless. Adds Section 12945.6 to the Government Code.

Retaliation: Expanding The Labor Commissioner’s Authority. With the Governor’s October 3 approval of SB 306, the DLSE will be authorized to investigate an employer—with or without a complaint being filed—when, during a wage claim or other investigation, the Labor Commissioner suspects retaliation or discrimination. The bill will also allow the Labor Commissioner or an employee to seek injunctive relief (that the employee be reinstated pending resolution of the claim) upon a mere finding of “reasonable cause” that a violation of the law has occurred. That injunctive relief, however, would not prohibit an employer from disciplining or firing an employee for conduct that is unrelated to the retaliation claim. The bill also authorizes the Labor Commissioner to issue citations directing specific relief to persons determined to be responsible for violations and to create certain procedural requirements. Amends Section 98.7 and adds Sections 98.74, 1102.61, and 1102.62 to the Labor Code.

Immigration: Worksite Enforcement Actions. AB 450, the “Immigrant Worker Protection Act,” prohibits employers from allowing immigration enforcement agents to have access to non-public areas of a workplace, absent a judicial warrant, and prohibits immigration enforcement agents to access, review, or obtain employee records without a subpoena or court order, subject to a specified exception. This bill requires an employer to provide notice of an immigration agency’s inspection of I-9 Employment Eligibility Verification forms or other employment records within 72 hours of receiving the federal notice of inspection—using a template created by the Labor Commissioner—to current employees; requires an employer to provide affected employees (i.e., those who may lack work authorization or whose documents have deficiencies) a copy of the inspection notice, upon reasonable request; and requires employers to provide affected current employees, and their authorized representative, a copy of the immigration agency inspection results and written notice of the obligations of the employer and the affected employee arising from the action. The bill grants exclusive authority to the Labor Commissioner or Attorney General to enforce these provisions and requires that any penalty recovered be deposited in the Labor Enforcement and Compliance Fund. Penalties for failure to satisfy these prohibitions and for failure to provide the required notices are: $2,000 up to $5,000 for a first violation, and $5,000 up to $10,000 for each further violation. The Labor Commission may recover up to a $10,000 penalty for each instance an employer re-verifies the employment eligibility of a current employee at a time or in a manner not required by federal law. Stay tuned for a detailed analysis of AB 450 coming soon. Adds Sections 7285.1, 7285.2, and 7285.3 to the Government Code; adds Sections 90.2 and 1019.2 to the Labor Code.

Harassment Training: Gender Identity, Gender Expression, and Sexual Orientation. SB 396 requires employers with 50 or more employees to add items to already mandated biennial supervisory training to prevent sexual harassment. The new content must include practical examples to address harassment based on gender identity, gender expression, and sexual orientation. Employers must also post a DFEH-developed poster regarding transgender rights. The bill also makes changes to the Unemployment Insurance Code. Amends Sections 12950 and 12950.1 of the Government Code.

VETOED

Gender Pay Gap Transparency Act. AB 1209 would (as of July 2019) have required employers with at least 500 California employees to collect information on differences in pay between male and female exempt employees and between male and female Board members. The bill would have required employers to submit the information to the California Secretary of State by July 1, 2020, in a form consistent with Labor Code § 1197.5, and to provide an update to the Secretary of State every two years. The bill would have required the Secretary to publish the information on a public website if the Legislature provided it with sufficient funding. Yesterday the Governor vetoed the bill, stating—as many employers’ groups had pointed out—that the bill’s ambiguous wording made it unclear that the bill would “provide data that will meaningfully contribute to efforts to close the gender wage gap. Indeed, I am worried that this ambiguity could be exploited to encourage more litigation than pay equity.” He also cited the trust he has placed in his Pay Equity Task Force to provide guidance and recommendations to “assist companies around the state with assessing their current wage practices.” For more detail on implications of this bill had it passed, click through to our in-depth analysis on AB 1209.

Reproductive Health. The Governor vetoed AB 569 on October 15, stating that the FEHA “has long banned such [reproductive health-based] adverse actions, except for religious institutions. I believe those types of claims should remain within the jurisdiction of the [DFEH].” The bill would have added a provision to the Labor Code prohibiting an employer from taking adverse employment action against an employee or the employee’s dependents or family members for their reproductive health decisions, including the use of any drug, device, or medical service (e.g., birth control, abortions, or in vitro fertilization). An employer that violates this prohibition would have been subject to penalties under Labor Code § 98.6, as well as reinstatement, reimbursement of lost wages and interest, and other appropriate compensation or equitable relief. This bill would have prohibited employers from attempting to contract out of these requirements, by making null and void any express or implied agreement waiving these requirements. The bill would have required employers to include a notice of these employee rights and remedies in their handbooks.

Employee Request: Injury and Illness Prevention Program. AB 978 would have required an employer to provide a free copy of the company’s injury prevention program to an employee, or their representative, within 10 days of receiving a written request. A representative would have included a recognized or certified collective bargaining agent, attorney, health and safety professional, nonprofit organization, or immediate family member. AB 978 would have allowed an employer to take reasonable steps to verify the identity or the person making the written request and authorized an employer to assert impossibility of performance as an affirmative defense against allegations of violations of these provisions. Governor Brown found this bill to be “unnecessary and duplicative” of current regulatory proposals sitting with the Cal-OSHA Standards Board and noted that their advisory committee would be “better suited to determine how to properly implement requirements of this kind.”

BILLS THAT FAILED TO MAKE THE LEGISLATIVE CUT

Opportunity to Work Act. The notorious AB 5 would have required employers with 10 or more employees in California to offer additional hours of work to existing nonexempt employees before the employer could hire additional or temporary employees. This bill piggy-backed on the San Jose voter-approved Opportunity to Work Ordinance that, effective March 2017, would have required employers to offer part-time employees additional hours before hiring new or temporary employees. Read more on what AB 5 would have implemented herehere, and watch here.

Rest Breaks. AB 817 would have created an exception to Labor Code section 226.7’s off-duty “rest period” requirement for employers providing emergency medical services to the public. The bill would have allowed EMS employers to require their employees to monitor and respond to emergency response calls during rest or recovery periods without penalty, so long as the rest period is rescheduled.

Retail Employees: Holiday Overtime. AB 1173 would have established an employee-selected overtime exemption that would have allowed a “retail industry” employee to work up to 10 hours per day with no overtime pay during the holiday season (November through January). Overtime paid at time and one-half of the employee’s regular pay rate would have applied to over 40 hours worked in a workweek or 10 in a work day; double time would have applied to work over 12 hours per day and over eight hours on the fifth, sixth, or seventh day in a workweek. The bill would have required employees to submit a written request for the flexible work schedule for approval by the employer. The authors of this bill did not specifically define what “retail industry” would have meant.

Overtime Compensation: Executive, Administrative, or Professional Employees. AB 1565 would have exempted an executive, administrative, or professional employee from overtime compensation if the employee earns a monthly salary of $3,956 or at least twice the state minimum wage for full-time employment, whichever is greater. This bill would have had California follow President Obama’s FLSA regulations increasing the yearly salary exempt threshold from $23,660 to $47,476 for executive, administrative, and professional workers. (Those regulations have been enjoined by a federal court.)

Health Professional Interns: Minimum Wage. AB 387 would have broadened the definition of employers required to pay minimum wage to include anyone who employs any person engaged in supervised work experience (i.e., students working clinical hours) to satisfy the requirements for licensure, registration, or certification as an allied health professional. This bill would have applied only to a work experiences longer than 100 hours and would not have applied to employers with fewer than 25 allied health professionals or a primary care clinic.

Resident Apartment Manager Wages. AB 543 would have extended an exemption from Industrial Welfare Commission orders allowing employers, who do not charge rent to a resident apartment manager pursuant to a voluntary agreement, to apply up to one-half of the apartment’s fair market value (no value cap) to meet minimum wage obligations to the apartment manager. This was up from the two-thirds previously provided but capped at $564.81 per month for singles, $835.49 for couples.

Voluntary Veterans’ Preference Employment Policy Act. Both AB 353 and its almost identical twin AB 1477 hoped to revise FEHA’s existing Vietnam-Era veterans’ status provision but failed to make it out of both houses and out of the house of origin, respectively. The bills would have expanded a private employer’s authority to institute and uniformly grant a hiring preference for veterans regardless of where the veteran served. The bills stated that the hiring preference would not have violated FEHA or any local or state equal opportunity employment law or regulation. But the bill would have prohibited the use of a veterans’ preference policy for the purpose of discrimination on the basis of any protected classification.

Credit and Debit Card Gratuities. AB 1099 would have required an entity—defined as “an organization that uses online-enabled applications or platforms to connect workers with customers … including, but not limited to, a transportation network company” (e.g., Uber)—to accept tips by credit or debit cards if the entity allows customers to pay with credit or debit cards. The bill would have required that the tip be paid to the worker the next regular payday following the date the customer authorized the card payment. This bill made it out of the Assembly but the author canceled its hearing in the Senate Committee on Labor and Industrial Relations so we may see this bill again next year.

Labor Organizations: Compulsory Fee Payments. AB 1174 would have established the “California Right to Work Act of 2017” to prohibit a requirement that employees pay into a labor union, charity, or other third party as a condition of employment or continuing employment. This bill would have made California part of the list of 28 other Right to Work states in the nation.

Employer Liability: Small Business and Microbusiness. AB 442 would have prohibited Cal OSHA from bringing any “nonserious violation” against small business or microbusiness employers without first notifying the employer of the violation and the right to cure within 30 days. This safe harbor would not have applied to any willful violation. The impact of this bill would have been far reaching—nearly 70% of California employers employ only a handful of employees.

Good Faith Defense: Employment Violations. SB 524 would have allowed an employer to raise an affirmative defense that, at the time of an alleged violation, the employer was acting in good faith when relying upon a valid published DLSE opinion letter or enforcement policy. This bill would not have applied to the DLSE’s prosecution of payment of unpaid wages.

PAGA: 2017’s Three Failed Efforts. 

AB 281 attempted to reform PAGA by (1) requiring an actual injury for an aggrieved employee to be awarded civil penalties, (2) excluding health and safety violations from the employer right to cure provisions, and (3) increasing employers’ cure period to 65 calendar days, up from 33.

AB 1429 would have limited the violations an aggrieved employee can bring, required the employee to follow specific procedures prior to filing suit, limited civil penalties recoverable to $10,000 per claimant and excluded the recovery of filing fees, and required the superior court to review any penalties sought as part of a settlement agreement.

AB 1430 would have required the Labor and Workforce Development Agency (“LWDA”) to investigate alleged Labor Code violations and issue a citation or determination regarding a reasonable basis for a claim within 120 calendar days; and allow an employee private action only after the LWDA’s reasonable basis notification or the expiration of the 120 day period. Read our further analysis of the proposed PAGA amendments here.

Workplace Solutions.

For more information on how these new Peculiarities might affect your company, read our in-depth focus blogs and contact your favorite Seyfarth attorney.

Seyfarth Synopsis: The Trump Administration’s hard line on immigration has concerned undocumented immigrants who want to raise wage claims. The LWDA recently reaffirmed a commitment to protect workers regardless of their immigration status.

California has noticed the Trump Administration’s immigration initiatives. Here, as elsewhere, California charts its own path. The state’s labor law enforcement officials worry that the immigration crackdown has panicked undocumented workers, causing them to withhold complaints against their employers, for fear of deportation. Indeed, some undocumented workers reportedly have declined to accept unpaid wages owed to them, and have refused to cooperate with government investigations. There have been reports of ICE agents showing up at California Labor Commissioner proceedings to remove undocumented workers who are appearing to prosecute their labor claims against their employers.

On May 1, 2017, the LWDA reaffirmed its commitment to worker protections regardless of their immigration status:

Just because the federal administration has changed, our laws and policies have not. … We will not tolerate the use of immigration status as a tool of retaliation against workers who are pursuing their rights under California law. … The California Labor and Workforce Development Agency and its partner departments reiterate that we never ask for – nor do we collect – the immigration status of any worker who files a health and safety or wage theft claim with our offices. It has been longstanding state policy that our labor laws apply to all workers, regardless of immigration status, and that the immigration status of a worker is unnecessary information to enforcing our laws.

The full press release appears here.

Thus, regardless of what the Trump Administration does, the LWDA is making it clear that California’s labor protections apply to all employees – regardless of their immigration status – and that the LWDA will ensure that immigrant workers know that California workplace protections apply to them.

The LWDA’s statement reminds California employers that they can still be subject to liability, fines, and investigations for Labor Code violations no matter what the federal government does. Immigration status remains, in the view of the LWDA, irrelevant to the enforcement of California wage and hour laws. Thus, employers should not treat immigrant workers differently because of their status.

California wage and hour law can be difficult to navigate. If you would like to review your policies for compliance, you may contact one of Seyfarth Shaw’s attorneys for assistance.

Edited by Michael Wahlander.

Seyfarth Synopsis: On July 17, 2017, the California Fair Employment and Housing Council (FEHC) heard public comments on its proposed regulations covering national origin discrimination under the FEHA. Discussion centered on employer-imposed language restrictions, English proficiency requirements, and immigration-related employment practices. Look for final regulations later this year. 

The FEHC kicked off its third meeting of the year, this time in San Francisco. Prominent on the agenda: the proposed and rapidly advancing national origin discrimination regulations. As stated in the FEHC’s notice of the meeting: “The overall objective of the proposed amendments is to describe how the [FEHA] applies to the protected class of national origin in the employment context, primarily by centralizing and codifying existing law, clarifying terms, and making technical corrections.”

A call to enact these regulations first came from Legal Aid at Work (an employee-oriented legal services organization formerly known as the Legal Aid Society, Employment Law Center), during the FEHC’s August 31, 2016 hearing. The FEHC quickly created a subcommittee and drafted regulations, which we previously reported on here, that largely mirrored the EEOC’s guidance on national origin discrimination.

At the July 17 hearing, public comments revolved around (a) language restrictions (“English only” rules), (b) employer requirements for English language proficiency, (c) discovery as to an individual’s immigration status during the liability phase of any lawsuit or other proceeding to enforce the FEHA’s prohibition of national origin discrimination, and (d) expanding the definition of what constitutes harassment on the basis of national origin. The only public comments received at the hearing were from employee-leaning individuals and groups.

English only. The draft regulations would make it an unlawful employment practice for an employer to adopt a policy that creates an “English only” rule, unless (1) the rule is job-related and consistent with business necessity, (2) the rule is narrowly tailored, and (3) employees get effective notice of when and where the rule applies and what consequences result from a violation.

The regulations would also provide that an English-only policy would not be valid simply for promoting business convenience or reflecting customer preference. Representatives of Legal Aid at Work emphasized at the hearing that the latter should be amended to state a co-worker preference, not the customer’s.

Further, the regulations would explicitly presume that English-only rules violate FEHA unless the employer can prove “business necessity”—defined narrowly as “an overriding legitimate business purpose” that is necessary to the safe and efficient operation of the business, where the policy effectively serves that purpose, and where there is no alternative to the language restriction that would serve the business purpose as well, with less discriminatory impact. One commentator at the hearing argued that the FEHC should expand this presumption to find a violation if there is no effective employee notification about the language restrictions. Legal Aid at Work also called for the FEHC to draft a new section to address how an English-proficiency requirement relates to an employee’s ability to perform the job. These folks would like CA to distinguish itself from the reasoning of Garcia v. Rush-Presbyterian-St. Luke’s Medical Center, in which the court approved an employer’s requirement for verbal and written English proficiency in part because English was the dominant language in the area.

Discovery of Immigration Status. The FEHC also heard public comments to clarify the complex rule about when discovery into an individual’s immigration status is allowed during the liability phase of a proceeding. The proposed regulations would permit such discovery “only when the person seeking to make the inquiry has shown by clear and convincing evidence that such inquiry is necessary to comply with federal immigration law.” The commentators argued that mere possession (or lack) of a driver’s license would not constitute “clear and convincing evidence,” as all California residents are eligible to receive a license, regardless of immigration status.

Expansion of “harassment.” A representative of the California Employment Lawyers Association (a group of plaintiffs’ lawyers calling themselves an employee-rights group) called for expansion of the harassment portion of the regulations, to include specific reference to banning creation of a hostile work environment on the basis of national origin. Speakers also asked that the FEHC expand what would constitute as per se harassment to include deportation threats against an individual’s blended family members (i.e., step-parents, step-aunts and uncles, and step-children).

The comment period for the proposed regulations closed at 5 p.m. on July 17th. We anticipate the FEHC will consider all comments before issuing a final statement of reasons and potentially revising the proposed regulations.

We will keep you apprised of what the FEHC opines next on the topic of national origin regulation. For advice on how these regulations may affect your business, reach out to your favorite Seyfarth attorney.

Edited by Colleen Regan.

Seyfarth Synopsis: Pay equity and Ban The Box bills lead the list of bills approved to continue their quest (moving to the other house of the California Legislature) to become California law.

Friday, June 2, marked the last day for bills in the California Legislature to pass out of their house of origin—the Senate or Assembly—and continue the legislative process for a shot at becoming a new California Peculiarity. Pay equity and Ban The Box bills lead the list of bills approved to continue moving through the process. Meanwhile, some other feared bills, including the Opportunity to Work Act and retail holiday overtime, did not make the cut. But the substance of these bills, like zombies, may refuse to die and re-emerge through amendment to bills that are still alive. We’ll keep watching, and keep you updated, through the September 15 deadline for bills to pass from the Legislature to the Governor’s desk.

Still Alive:

Pay Equity: Salary Inquiry Ban. AB 168 would prohibit employers, including state and local governments (even the Legislature) from asking applicants about their salary history information, including compensation and benefits. The bill would also require private employers to provide the applicant with the position’s pay scale upon a reasonable request. Will the third time be the charm for this legislation? AB 168 is scheduled for hearing June 14 in the Senate Committee on Labor and Industrial Relations.

Pay Equity: Gender Pay Gap Transparency Act. Attempting a California version of the revised EEO-1 report, AB 1209, effective July 1, 2020, would require employers with 250 or more employees to collect specified data on gender pay differentials, to publish the data on their websites, and to submit the data annually in reporting to the Secretary of State. The required data would include the difference between the mean salary and median salary of male exempt employees and female exempt employees, by job classification or title, and the difference between the mean compensation and median compensation of male board members and female board members. Committee analyses note that this bill was modeled after the recent measure passed in the United Kingdom that requires employers with 250 or more employees to publish their gender pay figures by April 2018.

Applicants: Prior Criminal History. On the heels of Los Angeles’s adoption of “Ban-the-Box,” this year’s attempt at even stronger, state-wide “Ban the Box” legislation marches on. AB 1008 would make it unlawful under California’s Fair Employment and Housing Act (“FEHA”) for an employer to include on any employment application any question seeking disclosure of an applicant’s criminal history, to inquire into or consider the conviction history of an applicant before extending a conditional offer of employment, or to consider or distribute specified criminal history information in conducting a conviction history background check. The bill would require an employer that intends to deny a position solely or in part because of the applicant’s prior conviction to assess whether the applicant’s conviction history has a direct and adverse relationship with the specific job duties. Then, the employer must notify the applicant of the reasons for the decision, provide the applicant time to respond, and consider the response before making a final written employment decision. Exempted from the bill’s scope are criminal justice agencies, farm labor contractors, and positions for which the law requires a state or local agency to conduct a background check or precludes employment based on criminal history.

Voluntary Veterans’ Preference Employment Policy Act. AB 353 would allow private employers to establish a veterans’ preference policy and uniformly grant a hiring preference to veteran applicants, regardless of when the veteran served. This preference would not violate the FEHA or any other local or state equal opportunity employment law or regulation (provided that the policy is not applied for the purpose of discrimination on the basis of any protected classification).

Credit and Debit Card Gratuities. AB 1099 would require entities that allow debit or credit card payment for services to also accept gratuities or tips via debit or credit card, and to pay those gratuities to the worker no later than the next regular payday. Prior to amendments, the bill would have applied to specified employers (lodging establishments, car washes, barber shops and beauty salons, massage parlors, restaurants, and on-demand service providers such as transportation network companies). As amended, rather than specifying the industries to which it applies, AB 1099 defines “entity” as “an organization that uses an online-enabled application or platform to connect workers with customers … including, but not limited to, a transportation network company.” The author’s stated reason for the bill is to make it easier and more reliable for workers in the gig economy to receive tips. The Assembly Appropriations Committee estimates the bill would cost approximately $300,000 in annual enforcement by the Department of Labor Standards Enforcement (“DLSE”), an estimate that could earn this bill the Governor’s veto.

Overtime Compensation: Executive, Administrative, or Professional Employees. AB 1565 would exempt from overtime compensation an executive, administrative, or professional employee who earns a monthly salary of either $3,956 or no less than twice the state minimum wage for full-time employment, whichever amount is higher. The bill states the Legislature does not intend to change the “duties test” of the overtime exemptions established in orders of the Industrial Welfare Commission for executive, administrative, or professional employees;  those provisions would continue to apply. The bill’s proponents argue that it would create “important protection for middle class workers who fall into the gap between the state’s overtime pay protections and what would have been higher overtime protections afforded” by federal Fair Labor Standards Act regulations adopted by President Obama’s US Department of Labor but enjoined through a court challenge. Opponents argue the bill unnecessarily accelerates salary increases for California exempt employees and applies to all employers regardless of size.

Immigration: Worksite Enforcement Actions. AB 450, the proposed “Immigrant Worker Protection Act,” would prohibit an employer from allowing federal immigration agency worksite enforcement authorities warrantless access to nonpublic areas of a place of labor and from releasing employee records to those federal authorities without a subpoena. This bill would also require an employer to notify the Labor Commissioner and employee representative of an Immigration and Customs Enforcement I-9 Employment Eligibility Verification audit within 24 hours of receiving the inspection notice and provide a copy of the notice. The bill would prescribe penalties, recoverable by the Labor Commissioner against employers for failing to satisfy the bill’s requirements and prohibitions, of not less than $2,000-$5,000 for the first violation and $5,000-$10,000 for each subsequent violation.

Good Faith Defense: Employment Violations. SB 524 would permit an employer to raise an affirmative defense that, at the time of an alleged violation of statute or regulation, the employer was acting in good faith when the employer relied upon a valid published DLSE opinion letter or enforcement policy. Even though SB 524 failed to pass the Senate Committee on Labor and Industrial Relations, reconsideration was granted and this bill is heading to the Assembly.

Retaliation: Expanding The Labor Commissioner’s Authority.  A former placeholder bill, as amended, SB 306 would authorize the Labor Commissioner, upon finding reasonable cause to believe an employer discharged or discriminated against an employee in violation of Labor Code section 98.7—before issuing a final determination—to seek temporary and permanent injunctive relief. This bill also would allow the Labor Commissioner to recover attorney’s fees and costs on a successful enforcement action, would authorize the Labor Commissioner to cite and penalize a person it determines violated Section 98.7, and would create procedural requirements for these processes.

Reproductive Health. AB 569 would add a provision to the Labor Code that would prohibit employers from taking any adverse employment action against an employee based on the employee’s or an employee dependent’s reproductive health decisions, methods, or use of a particular drug, device, or medical service (e.g., in vitro fertilization), including the timing of such. This bill would also prohibit employers from requiring employees to sign a code of conduct or similar document denying an employee the right to make such decisions. This bill would also require employers to include a notice of the employee rights and remedies in its handbook.  This bill is aimed at religiously affiliated institutions, noting (in language that would not be codified)  the Legislature’s agreement with Justice Alito in Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC (2012) 565 U.S. 171, 199, that “the ministerial exception should apply only to an ‘employee who leads a religious organization, conducts worship services or important religious ceremonies or rituals, or serves as a messenger or teacher of its faith.’”

New Parent Leave Act. SB 63, as its predecessor (the vetoed SB 654 of 2016) attempted, would prohibit larger employers (having at least 20 employees within 75 miles) from refusing to allow an employee to take up to 12 weeks of parental leave to bond with a new child within one year of the child’s birth, adoption, or foster care placement as long as the employee has at least 1,250 hours of service with the employer during the previous 12-month period. This bill would also require the employer to maintain and pay for the employee’s coverage under a group health plan during this leave and allow—although not require—an employer to grant simultaneous leave to two employees entitled to leave for the same birth, adoption, or foster care placement.

Employee Request: Injury and Illness Prevention Program. AB 978 would require an employer to provide an employee or the employee’s representative a copy of the employer’s injury prevention program, free of charge, within 10 business days after the employer receives a written request. Under this bill, a recognized collective bargaining agent would automatically be treated as an authorized employee representative. The employer would be able to assert an impossibility of performance affirmative defense.

Bills Stuck in the House of Origin:

Opportunity to Work Act. More expansive than the City of San Jose’s voter-approved Opportunity to Work Ordinance, the much-publicized and employer-feared AB 5 would have required employers with 10 or more employees in California to offer additional hours of work to existing nonexempt employees in California before the employer could hire additional employees or temporary employees. AB 5’s hearing in Assembly Appropriations was postponed by the committee on May 3. Read more on what AB 5 would have implemented here, here, and watch here.

Rest Breaks. AB 817 would have carved out an exception to Labor Code section 226.7’s off-duty “rest period” requirement for employers providing emergency medical services to the public. The bill would authorize those EMS employers to require employees to monitor and respond to calls for emergency response purposes during rest or recovery periods without penalty, as long as the rest break is rescheduled. AB 817 stalled in the Assembly Committee on Labor and Employment as the bill’s author, Assembly Member Flora, canceled the hearing.

Retail Employees: Holiday Overtime. AB 1173 would have established an overtime exemption that would have allowed an employee to work up to 10 hours per workday with no overtime pay. Hours worked between 10 and 12 in a workday, or over 40 hours in a workweek would be paid at one and one-half the regular rate of pay. All hours over 12 in a workday and over eight on a fifth, sixth, or seventh day in a workweek would have been paid at double time. This bill never even received a definition to fill in its “retail industry” blank, and was sent to but never heard in the Assembly Committee on Labor and Employment.

Voluntary Veterans’ Preference Employment Policy Act. Feeling déjà vu? AB 1477, almost identical to AB 353, detailed above, would have allowed private employers to establish a veterans’ preference policy  and uniformly grant a hiring preference to veteran applicants, regardless of when the veteran served. This bill remained stagnant in the Assembly Committee on Veterans Affairs and Labor and Employment.

Health Professional Interns: Minimum Wage. AB 387 would have expanded the definition of “employer” to include a person who employs any person engaged in supervised work experience (i.e., clinical hours) to satisfy the requirements for licensure, registration, or certification as an allied health professional. AB 387 was amended to only include work experience longer than 100 hours before Assembly Member Thurmond ordered it to the inactive file on June 1.

Resident Apartment Manager Wages. AB 543 would have authorized an employer that doesn’t charge a resident apartment manager monthly rent, to apply up to one-half of the fair market rental value, instead of the two-thirds provided by existing law, of the apartment to meet minimum wage obligations to the apartment manager, pursuant to a voluntary agreement. This bill’s hearing in the Assembly Committee of Labor and Employment was canceled at the author’s request.

Labor Organizations: Compulsory Fee Payments. AB 1174 would have prohibited a person from requiring employees, as a condition of employment, to pay union dues or contribute financially to any charity sponsored by or at the behest of a labor organization. This bill failed to pass the Assembly Committee on Labor and Employment.

Employer Liability: Small Business and Microbusiness. AB 442 would have prohibited Cal OSHA from bringing an enforcement action for any “nonserious violation” against any employers with small businesses or microbusinesses without first giving the employer written notice of the violation and providing 30 days to cure. The bill would have authorized Cal OSHA to assess a reasonable fee, up to $50, to cover its costs for enforcement. The bill’s hearing in the Assembly Committee on Labor and Employment was canceled at the request of the author.

PAGA: Three Valiant, But Failed, Efforts. 

AB 281 attempted to reform PAGA by (1) requiring an actual injury for an aggrieved employee to be awarded civil penalties, (2) excluding health and safety violations from the employer right to cure provisions, and (3) increasing employers’ cure period to 65 calendar days, up from 33.

AB 1429 would have limited the violations an aggrieved employee can bring, required the employee to follow specific procedural prerequisites to filing suit, limited civil penalties recoverable to $10,000 per claimant and excluded the recovery of filing fees, and required the superior court to review any penalties sought as part of a settlement agreement.

AB 1430 would have required the Labor and Workforce Development Agency (“LWDA”) to investigate alleged Labor Code violations and issue a citation or determination regarding a reasonable basis for a claim within 120 calendar days; and allow an employee private action only after the LWDA’s reasonable basis notification or the expiration of the 120 day period. Read our further analysis of the proposed PAGA amendments here.

All three PAGA reform attempts stalled in the Assembly Committee on Labor and Employment.

Workplace Solutions

We will keep you apprised of these continuing Peculiarities, as well as any other significant legislative developments that occur as the end of the 2017 Legislative Session draws near. Contact your favorite Seyfarth attorney with any questions.

Seyfarth Synopsis: Back from Spring Break, and Back to Work: Our List of L&E Bills to Watch in the remainder of the 2017-2018 California Legislative Session.

New LegislationCalifornia Legislators were, as always, very busy in the first few months of the 2017-18 Legislative Session, introducing well over 2000 bills by the February 17th bill introduction deadline. But, in comparison to prior years, the calendar has been surprisingly light for heavy-hitter labor and employment bills. The Legislature returned to work on April 17, after its spring break, and continued to push bills out of the house of origin in advance of the June 2nd deadline.

Here’s what we’re watching:

Opportunity to Work Act. Modeled after the City of San Jose’s November 2016 voter-approved Opportunity to Work Ordinance (effective April 1, 2017), AB 5 would require employers with 10 or more employees in California to offer additional hours of work to existing nonexempt employees in California before the employer may hire additional employees or temporary employees. The employer would not have to offer the hours to existing employees if those hours would result in the payment of overtime compensation to those employees. The bill would require employers to retain documents, including work schedules of all employees and documentation of offering additional hours to existing employees, prior to hiring new employees or subcontractors. The bill would also require employers to post a notice to be created by the Division of Labor Standards Enforcement (DLSE) outlining employee rights under this (proposed) new law. This Act would create a new Labor Code section, and provide for enforcement by the DLSE on its own accord or via complaint by an employee, or via employee private right of action. The Act would allow for an express CBA carve-out. The bill is scheduled for its initial hearing in the Assembly Committee on Labor and Employment on April 19. Stay tuned for an update on this bill following the hearing.

Rest Breaks. AB 817 would carve out an exception to Labor Code section 226.7’s off-duty “rest period” requirement for employers providing emergency medical services to the public. The bill would authorize those EMS employers to require employees to monitor and respond to calls for emergency response purposes during rest or recovery periods without penalty, as long as the rest break is rescheduled. The bill expressly states that it is declaratory of existing law. Likely in response to the California Supreme Court’s December 22, 2016 ruling in Augustus v. ABM Security Services, Inc. (holding that no true rest break was permitted when security guards were required to carry radios or pagers and respond to calls during rest breaks), this bill is one to watch.

Retail employees: Holiday Overtime. AB 1173 would establish an overtime exemption for “a holiday season employee-selected flexible work schedule,” requested in writing by individual nonexempt retail employees and approved by the employer. The exemption would allow the employee to work up to 10 hours per workday with no overtime pay. Hours worked between 10 and 12 in a workday, or over 40 hours in a workweek would be paid at one and one-half the regular rate of pay. All hours over 12 in a workday and over eight on a fifth, sixth, or seventh day in a workweek would be paid at double time. This bill contains a CBA carve-out, and clearly has many details to still be ironed out, as it contains a blank in the bill text for the definition of “retail industry.”

Pay Equity: salary inquiry ban. Once again, AB 168 seeks to ban employers, including state and local government employers, from asking job applicants about their salary history, as well as compensation and benefit information. The bill would also require that private employers, upon reasonable request, provide the applicant with the position’s pay scale. AB 168 brings back language that was shot down twice—first by Governor Brown in his October 2015 veto of AB 1017, then removed from 2016’s AB 1676 (fair pay legislation) before it received the Governor’s approval in September 2016.

Pay Equity: Gender Pay Gap Transparency Act. Dubbed the “Gender Pay Gap Transparency Act,” by author Assembly Member Gonzalez-Fletcher in her April 4, 2017 Equal Pay Day press release, AB 1209 would “require companies with more than 250 employees to include gender pay data as part of their annual reporting to the Secretary of State.” If passed, AB 1209 would require employers, beginning July 1, 2020, to publish and update yearly the difference between the mean salary and median salary of male exempt employees and female exempt employees broken down by job classification or title and the difference between the mean compensation and median compensation for male board members and female board members. Arguments against this bill will likely mirror those made in response to the EEOC’s revised EEO-1 rule.

Voluntary Veterans’ Preference Employment Policy Act. Dubbed the “Voluntary Veterans’ Preference Employment Policy Act,” AB 353 and AB 1477 would allow private employers to establish a veterans’ preference policy  and uniformly grant a hiring preference to veteran applicants, regardless of when the veteran served. These bills would expand Government code section 12940(a)(4), which currently allows for a veterans’ preference policy for Vietnam-era veterans only. The bill would provide that the granting of a veterans’ preference will not violate any local or state equal employment opportunity law or regulation, including FEHA, as long as the policy is not applied for the purpose of discriminating against an employment applicant on the basis of any protected classification.

Applicants: prior criminal history. The Legislature is joining the flurry of “Ban-the-Box” initiatives throughout California with AB 1008, which would make it unlawful for an employer to: 1) include on any job application questions that seek the disclosure of an applicant’s criminal history; 2) inquire or consider an applicant’s prior convictions before extending a conditional offer; and 3) when conducting a background check, to consider or disclose  various information. The bill would also require employers that intend to deny employment to an applicant because of prior convictions to perform an individualized assessment of whether the applicant’s conviction history has a direct and adverse relationship to the specific job duties, considering the nature and gravity of the offense, the time passed since the completion of the sentence, and the nature of the job. Then, the employer must notify the applicant of the reasons for the decision and provide the applicant 10 days to respond and challenge the accuracy of that information or provide evidence of rehabilitation which it must consider before making a final employment decision, in writing. This bill is substantially similar to the recent Fair Employment and Housing Council regulations, which go into effect in July 2017; and would thus largely codify what will soon be required by regulation.

Health professional interns: minimum wage. Following the recent increases in minimum wage, AB 387 would expand the definition of “employer” to include a person who employs any person engaged in supervised work experience (i.e., clinical hours) to satisfy the requirements for licensure, registration, or certification as an allied health professional. Cal Chamber opposes this bill, as it could cause internships provided for educational credit to be eliminated.

Resident apartment manager wages. AB 543 would authorize, under a voluntary written agreement, an employer that doesn’t charge a resident apartment manager monthly rent, to apply up to one-half of the fair market rental value of the apartment to meet minimum wage obligations to the apartment manager. Existing law allows employers to take a credit against minimum wage for two-thirds of the ordinary rental value, up to $564.81 per month for a single occupant and $835.49 per month for couples.

Credit Card gratuities. AB 1099 would require employers that are lodging establishments, car washes, barber shops and beauty salons, massage parlors, restaurants, and on-demand service providers such as transportation network companies that allow debit or credit card payment for services to also accept a debit or credit card for gratuities or tips. This bill would require the tip payment to be made to the employee by the next regular payday following the date the credit card authorized payment.

Overtime compensation: executive, administrative, or professional employees. AB 1565 would exempt from overtime compensation an executive, administrative, or professional employee, if the employee earns a monthly salary of either $3,956 or no less than twice the state minimum wage for full-time employment, whichever amount is higher.

Labor organizations: compulsory fee payments. AB 1174 would, beginning January 1, 2018, prohibit a person from requiring employees, as a condition of employment, to pay union dues or contribute financially to any charity sponsored by or at the behest of a labor organization.

Employer liability: small business and microbusiness. AB 442 would prohibit Cal OSHA from bringing an enforcement action for any “nonserious violation” against any employers with 100 or fewer employees and an average gross of $10,000,000 or less over the past three years, or microbusinesses  with 25 or fewer employees and an average gross of $2,500,000 or less over the past three years, without first giving the employer written notice of the violation and providing 30 days to cure. AB 442 would authorize Cal OSHA to assess a reasonable fee, up to $50, to cover its costs for enforcement.

Immigration: worksite enforcement actions. AB 450, the “Immigrant Worker Protection Act,” would impose several requirements on public and private employers dealing with federal ICE workplace raids or enforcement actions. Assemblymember Chiu has described the key components as:

  • Requiring employers to ask for a warrant before granting ICE access to a worksite.
  • Preventing employers from releasing employee records without a subpoena.
  • Requiring employers to notify the Labor Commissioner and employee representative of a worksite raid and notifying the Labor Commissioner, employees, and employee representatives of an I-9 audit (i.e., employment eligibility verification).
  • Preventing retaliation by enabling workers crucial to a labor claim investigation to receive certification from the Labor Commissioner that employee complainant or employee witness has submitted a valid complaint for violations of the Code and is cooperating in the investigation and prosecution of the violations.

The bill would authorize the Labor Commissioner to asses penalties of at least $10,000 to $25,000 for each violation against employers for failure to satisfy the bill’s requirements and prohibitions.

FEHA enforcement expansion. SB 491 would expand Government Code section 12993 and allow local jurisdictions, such as cities and counties, to enforce FEHA discrimination regulations. Cal Chamber opposes this bill.

Good faith defense: employment violations. SB 524 would permit an employer to raise an affirmative defense that, at the time of a violation, the employer was acting in good faith when the employer relied upon a valid published DLSE opinion letter or enforcement policy. SB 524 would only apply after January 1, 2018 to DLSE opinion letters or enforcement policies that are still in effect at the time of the violation. Employers would not be able to claim an affirmative defense when a DLSE opinion letter or enforcement policy has been modified, rescinded, or deemed invalid. Cal Chamber supports this bill but hearings for SB 524 have been canceled at the request of the author, Senator Vidak. We’ll keep our eye on this to see if there is any further movement.

Reproductive health. AB 569 would prohibit employers from taking any adverse employment action against an employee based on the employee or employee’s dependent’s reproductive health decisions. The bill would also prohibit employers from requiring employees to sign a waiver or any document denying an employee the right to make his or her own reproductive health care decisions, including the use of a particular drug, device, or medical service (e.g., in vitro fertilization). The bill would require an employer to include in its handbook a notice of the employee rights and remedies under this bill.

New Parent Leave Act. Likely DOA, but resurrected for another go from its 2016 veto, SB 63, the “New Parent Leave Act,” would prohibit employers with at least 20 employees within 75 miles, from refusing to allow an employee to take up to 12 weeks of parental leave to bond with a new child within one year of the child’s birth, adoption, or foster care placement. Like under CFRA, to be eligible, the employee must have more than 12 months and at least 1,250 hours of service with the employer during the previous 12-month period. The bill would require the employer to maintain and pay for the employee’s coverage under a group health plan during this leave. SB 63 would also allow—but not require—an employer to grant simultaneous leave when two employees are entitled to leave for the same birth, adoption, or foster care placement. This bill is almost identical to 2016’s SB 654, which Governor Brown vetoed, and only provided for 6 weeks of leave, rather than the 12 weeks SB 63 would provide. The Governor’s veto message expressed his concerns for impact the leave would have on small business and pointed lawmakers to explore an amendment that would have made mediation an option—which the SB 63 does not have.

PAGA: Three New Valiant Efforts. AB 281 attempts to reform PAGA by: 1)  requiring an actual injury for an aggrieved employee to be awarded civil penalties; 2) excluding health and safety violations from the employer right to cure provisions; and 3) increasing employers’ cure period to 65 calendar days from 33.

AB 1429 would limit the violations an aggrieved employee can bring, require the employee follow specific procedural prerequisites to filing suit, limit civil penalties recoverable to $10,000 per claimant and exclude the recovery of filing fees, and require the superior court to review any penalties sought as part of a settlement agreement.

AB 1430 would require the Labor and Workforce Development Agency (LWDA) to investigate alleged Labor Code violations and issue a citation or determination regarding a reasonable basis for a claim within 120 calendar days; and allow an employee private action only after the LWDA’s reasonable basis notification or the expiration of the 120 day period. Read our further analysis of PAGA proposed amendments here.

Workplace Solutions

We will continue to monitor and report on these potential Peculiarities, as well as any other significant legislative developments over the course of the 2017 Legislative Session. Contact your favorite Seyfarth attorney with any questions.

Edited by Colleen Regan.

Seyfarth Synopsis: Employers in California: be aware and prepare for new laws increasing minimum wages and mandating overtime pay for agricultural employees; expanding the California Fair Pay Act to race and ethnicity and to address prior salary consideration; imposing new restrictions on background checks and gig economy workers; and more. Small employers will be relieved the Governor vetoed expanded unpaid parental leave, but it will likely return in future sessions.

Friday, September 30, was Governor Jerry Brown’s deadline to sign or veto bills approved during the 2015-2016 Legislative Session. We summarize below this year’s bills that did and did not receive the Governor’s signature. Read on to prepare for our October 6 webinar offering Workplace Solutions for these pesky new Cal-peculiarities and register here.

SIGNED

Pay Equity

Fair Pay Act: Prior Salary & Race/Ethnicity. Saving some high-profile approvals to the last day, on Friday the Governor signed into law AB 1676 and SB 1063.  AB 1676 amends last year’s Fair Pay Act, Section 1197.5 of the Labor Code, to prohibit employers from considering prior salary as the sole justification for any disparity in compensation. SB 1063 expands the Fair Pay Act to race and ethnicity, and responds to critics that the pay equity issue is not limited to gender.  Specifically, it would prohibit employers from paying employees a wage less than the wage paid to employees of a different race or ethnicity for substantially similar work. Since both bills were signed by the Governor, both bills’ substantive changes will become law, though only the last-chaptered bill will be that which officially becomes law.

Before amendments applied in the legislative process, AB 1676 would have prohibited employers from seeking an applicant’s salary history information just as its vetoed predecessor, AB 1017, attempted to do last year. In vetoing AB 1017, Governor Brown stated that we should wait to see whether last year’s momentous Fair Pay Act, SB 358, addressed the pay equity issue before making further changes.  The amendments likely made this amendment palatable to the Governor, and kept California from matching the new Massachusetts law prohibiting Massachusetts employers from requesting the compensation history of a prospective employee before making an offer, unless the prospective employee has “voluntarily” disclosed that information. Amends Labor Code Sections 1197.5 and 1199.5. Effective January 1, 2017.

Wage and Hour

Agricultural Workers. AB 1066  enacts the “Phase-In Overtime for Agricultural Workers Act of 2016,” which requires employers to pay agricultural workers overtime over a four-year phase-in process. Beginning January 1, 2019, employers are required to pay overtime for any hours worked over 9.5 hours per day or 55 hours per workweek. Each year the hours worked triggering overtime pay will reduce, until reaching 8 hours per day, 40 hours per week, beginning January 1, 2022. Also beginning on January 1, 2022, any employee who works over 12 hours per day must be paid at a rate no less than double the regular rate of pay. The Governor may temporarily suspend the scheduled overtime requirement but only if the minimum wage increases are suspended as well. Employers that employ 25 or fewer employees will have an extra three years to comply with the phase-in and must begin paying overtime by January 1, 2022.  This bill began as AB 2757, which failed to pass the house of origin in June.  Undeterred, author Assembly Member Lorena Gonzales resurrected it with the legislative “gut and amend” trick, putting its contents into a bill formerly relating to educational employees.  Amends Labor Code Section 554 and adds Chapter 6 (commencing with Section 857) to Part 2 of Division 2 of the Labor Code.  Effective January 1, 2017.

Minimum Wage Violation Challenges. AB 2899 requires that any employer, before appealing a decision by the Labor Commissioner (LC) relating to a violation of wage laws, must file a bond—in favor of the unpaid employee—with the LC that covers the total amount of any minimum wages, liquidated damages, and overtime compensation owed. The bill also provides that the total amount of the bond is to be forfeited to the employee if the employer fails to pay the amounts owed within 10 days from the conclusion of the proceedings. Amends Labor Code Section 1197.1. Effective January 1, 2017.

Itemized Wage Statements. AB 2535 comes on the heels of the recent federal decision, Garnett v. ADT,  and clarifies Labor Code section 226. This bill specifies that employers need not list the number of hours worked on wage statements for any employee who is exempt from minimum wage and overtime requirements under the applicable IWC Wage Order or under statutes specified in Labor Code Section 226(j). Amends Labor Code Section 226.  Effective January 1, 2017.

Leaves of Absence

Paid Family Leave Expansion.  AB 908, which the Governor signed on April 11, 2016, increases the amount of benefits paid to employees on paid family leave and state disability leave from the current level of 55 percent to either 60 or 70 percent depending on the applicant’s income.  Read our report on AB 908 hereAffects Sections 2655, 3303, and 2655.1 of the Unemployment Insurance Code. Effective January 1, 2017, but provisions of the bill not operative until January 1, 2018.

Background Checks

Criminal History. AB 1843 prohibits employers from asking an applicant for employment to disclose any information regarding juvenile convictions and seeking or utilizing any information related to juvenile arrests, detentions, or court dispositions as a factor in employment determination. The bill does specify that an employer at a health facility can inquire into an applicant’s juvenile criminal background if a juvenile court made a final ruling or adjudication, that the applicant had committed a felony or misdemeanor relating to sex crimes or certain controlled substances crimes within five years prior to applying for employment. Still, these employers cannot inquire into an applicant’s sealed juvenile criminal records. Read more about existing California law on background checks hereAmends Labor Code Section 432.7.  Effective January 1, 2017.

Unfair Immigration-Related Practices. SB 1001 is a redux of 2015’s AB 1065, which was held in committee (and which we reported on here). SB 1001, like AB 1065, makes it an unlawful employment practice to request more or different documents than required under federal law to verify that an individual is not an unauthorized immigrant, or to refuse to honor documents tendered that on their face reasonably appear to be genuine, refuse to honor documents or work authorization based on specific status or term that accompanies the authorization to work, or to attempt to reinvestigate or re-verify an incumbent employee’s authorization to work using an unfair immigration-related practice. This year’s bill provision states that job applicants and employees who suffer an “unfair immigration-related practice” can file a complaint with the DLSE for enforcement. The bill provides that a violation of these provisions can result in a penalty of up to $10,000. Adds Section 1019.1 to the Labor Code.  Effective January 1, 2017.

Transportation Network Companies

Background Checks. AB 1289 requires a transportation network company (“TNC”; e.g., Uber) to conduct, or have a third party conduct, criminal background checks on each participating driver. This bill follows a 2014 lawsuit that accused TNCs of misleading customers by suggesting their background checks were the toughest in the industry. The bill also prohibits a TNC from contracting with a driver who is currently registered on the DOJ’s National Sex Offender Public Website; has been convicted of specified felonies within the past seven years; and/or has been convicted, within the past seven years, of misdemeanor assault or battery, domestic violence, or driving under the influence of drugs or alcohol. Adds Section 5445.2 to the Public Utilities Code.  Effective January 1, 2017.

Driving Under the Influence. AB 2687 makes it unlawful for a person to drive a vehicle with a blood alcohol level (BAC) of 0.04% or more when a passenger for hire is in the vehicle. The bill comes as an effort to lower taxi cab and ride sharing service driver’s BAC limit—currently at 0.08%—to the BAC limit of 0.04% as required for commercial motor vehicle drivers. Amends Vehicle Code Sections 23152 and 23153.  Effective July 1, 2018.

Personal Vehicles. AB 2763 defines a personal vehicle, used by a participating driver in a transportation network company, as one that has a passenger capacity of eight persons or less, (including the driver) and is owned, leased, or rented for a term that does not exceed 30 days, or otherwise authorized for use by the participating driver. Amends Public Utilities Code Section 5431.  Effective January 1, 2017.

Discrimination/Harassment

Employment Protections. AB 2337 expands the notice requirement employers with twenty-five or more employees must give to employees regarding domestic violence protections. Specifically, this bill provides that an employer must inform each new employee—and other employees upon request—of the rights protecting employees affected by domestic violence in writing. The Labor Commissioner is charged with developing the form providing notice by July 1, 2017.  Employers are not required to provide notice until the Labor Commissioner posts the form. Amends Labor Code Section 230.1.  Effective July 1, 2017.

Sexual Harassment Prevention Training. AB 1661 requires local agency officials to receive two hours of training and education on sexual harassment prevention within the first six months of taking office or commencing employment. To meet the requirements of this bill, local agency officials, including any member of a legislative body and any elected official of cities and counties, and special districts, must continue to receive this training once every two years. While AB 1661 is specific to local agency officials, AB 1825, enacted in 2004, established the same provisions for the workplace. AB 1661 comes on the heels of various high-profile sexual harassment cases against elected officials. Adds Article 2.4.5 (commencing with Section 53237) to Chapter 2 of Part 1 of Division 2 of Title 5 of the Government code.  Effective January 1, 2017.

Employment Discrimination. AB 488 allows individuals employed under a special license in a nonprofit sheltered workshop or rehabilitation facility to bring an action under the Fair Employment and Housing Act (FEHA) for prohibited harassment or discrimination. This bill came as an expansion of AB 1443, enacted in 2014, which extended FEHA’s protections to unpaid interns and volunteers. AB 488 now extends FEHA’s protections to workers with disabilities. Amends Section 12926, and adds Section 12926.05 to, the Government Code. Effective January 1, 2017.

Other Employee Protections

Employment Contracts—Choice of Law and Forum. SB 1241 prohibits an employer from requiring an employee, who resides and works in California, as a condition of employment, to agree to a provision that would either require the employee to litigate or arbitrate employment disputes (1) outside of California or (2) under the laws of another state. The only exception is where the employee was individually represented by a lawyer in negotiating an employment contract. The bill provides that any contract that violates these provisions is voidable by the employee. A court may award an employee reasonable attorney’s fees, among other remedies, for enforcing rights under the act. Read our in-depth report on SB 1241 hereAdds Section 925 to the Labor Code.  Effective January 1, 2017.

Employment Heat Safety. SB 1167 provides that the Division of Occupational Safety and Health (DOSH) shall propose to the Occupational Safety and Health Standards Board (Standards Board) for review and adoption, a standard that minimizes heat-related illness and injury among workers working in indoor places of employment by January 1, 2019. This bill comes as a response to a 2012 OSHA decision, upheld in 2015 by the Cal/OSHA appeals board, in which a staffing company and warehouse operator were fined for the heat illness suffered by an employee who was working inside a metal freight contained in over 100 degree heat. Adds Section 6720 to the Labor Code.  Effective January 1, 2019.

Employee Contact Information. AB 2843 expands an existing provision of the California Public Records Act (CPRA) that exempts the homes addresses and home telephone numbers of certain public employees from public disclosure to now cover all public employees, including persons paid by the state to provide in-home support services. Additionally, this bill extends the CPRA exemption to include the employee’s personal cell phone number and birth date. However, telephone numbers will be made available to bargaining agents for those employees. Amends Government Code Sections 6253.2 and 6254.3.  Effective January 1, 2017.

Industry Specific

Property Service Workers. AB 1978 creates the Property Services Workers Protection Act by establishing various requirements for the janitorial industry, including registering annually with the DLSE, to protect janitorial employees from wage theft and sexual harassment. The provisions of this bill apply to employers that employ at least one “covered worker” who enters into a contract, subcontract, or franchise agreement to provide janitorial services. This bill also requires the DLSE to maintain a database of property service employers and to develop a biennial sexual harassment and violence prevention training. This bill prohibits an employer from registering or renewing its registration if it has not fully satisfied any final judgment for unpaid wages or made appropriate tax contributions. “Successor employers” are also liable for any wages and penalties owed to the predecessor’s employees. The bill was signed while janitors were fasting outside of the CapitolAdds Part 4.2 (commencing with Section 1420) to Division 2 of the Labor Code.  Effective July 1, 2018.

Talent Services. AB 2068 updates the Talent Service Act’s existing communication and contractual protections to include new technologies, such as mobile applications. Specifically, AB 2068 strengthens the protection for an artist’s information or image to include information posted on an online service, online application, mobile application, or website. AB 2068 also updates the communication and advertisement protections between talent agencies and artists by including communication through the use of a telecommunication device, in print, on the Internet, or through the use of a mobile or online application or other electronic communication. AB 2068 also adds “text message” and other “electronic communication” to the list of methods by which an artist may ask that photographs and other information about the artist be removed from a website, online service, online application, or mobile application owned or serviced by the talent service. Amends Labor Code Sections 1703 and 1703.4.  Effective January 1, 2017.

Work Experience Education. AB 2063 provides an additional option for a student, at least 14 years old, to participate in work experience education. The bill also increases the number of hours per week a student may participate in job shadowing from 25 to 40 hours per semester, if the principal of the school where the student is enrolled certifies that it is necessary for the student’s participation in a career technical education program. Amends Education Code Section 51760.3 and 51769.  Effective January 1, 2017.

Commercial Online Entertainment Employment Services. AB 1687 addresses age discrimination in the entertainment industry by prohibiting a commercial online entertainment employment service (i.e., IMDb) that enters into a contract, from publishing a subscriber’s age or date of birth in an online profile. Proponents of this legislation cited cases such as Hoang v. Amazon.com, Inc, et al, in which a subscriber sued for having her age published on her profile page. The bill also requires that a service provider—upon request by the subscriber—remove age information from public view in any online profile under its control. Adds Section 1798.83.5 to the Civil Code. Effective January 1, 2017.

Other

Single-User Restrooms. AB 1732 requires all single-user toilet facilities in any business establishment, place of accommodation, or government agency to be identified as all-gender toilet facilities. The bill also provides that local officials responsible for code enforcement are to inspect for compliance. Adds Article 5 (commencing with Section 118600) to Chapter 2 of Part 15 of Division 104 of the Health and Safety Code.  Effective March 1, 2017.

VETOED (i.e., “it coulda been worse”)

Parental Leave. SB 654 would have significantly expanded California’s parental leave laws by requiring employers with 20 to 49 employees to provide up to six weeks of unpaid, job-protected parental leave and paid health benefits to bond with a new child within one year of the child’s birth, adoption, or foster care placement. Existing law—the California Family Rights Act—applies only to employers with 50 or more employees, and provides for at least 12 weeks of job-protected parental leave. The Governor vetoed this bill on September 30, stating: “It goes without saying that allowing new parents to bond with a child is very important and the state has a number of paid and unpaid benefit programs to provide for that leave.  I am concerned, however, about the impact of this leave particularly on small businesses and the potential liability that could result.  As I understand, an amendment was offered that would allow an employee and employer to pursue mediation prior to a lawsuit being brought.  I believe this is a viable option that should be explored by the author.”  In other words, we likely have not seen the last of this proposal.

Examination of Jurors. AB 1766 would have required that prospective jurors be referred to by either an identification number or abbreviation during voir dire in criminal trials. In his August 29 veto message, the Governor stated: “The open nature of criminal trials preserves both the defendant’s right to a fair and open trial, as well as the public’s faith in the court’s impartial application of the law. Under existing law, there are adequate remedies available if the court finds good cause to deny public access to the voir dire process or to specific juror information. These situations are best addressed on a case by case basis, and I do not believe there is a demonstrated need for a wholesale change at this time.”

BILLS THAT DIDN’T MAKE THE LEGISLATIVE CUT (i.e., “it coulda been a lot worse”)

Double Pay on the Holiday—2016 Edition. The Double Pay on Holiday Act of 2015 failed to make its way to the Governor for the second year in a row. AB 67 would have required retail and grocery store establishments, as well as restaurants located within them, to pay at least twice the regular rate of pay for employees who work on Thanksgiving.

Employee Time Off. AB 2405 would have required an employer to provide an employee at least eight hours annually of paid, job-protected, time off for an absence under the Family School Partnership Act. This bill came on the heels of SB 579, chaptered in 2015, which expanded the authorized reasons an employee can take job-protected time off under the Act and specified the definition of ‘family member” under California’s Kin Care. Read our report on SB 579 here.

Work Hours. SB 878 was similar to AB 357, the Fair Scheduling Act of 2015, which did not make it out of the Assembly. SB 878, the Reliable Scheduling Act of 2016, would have required that restaurant, grocery, and retail employers provide non-exempt employees with a 21-day work schedule in advance of their first shift on that work schedule. SB 878 would have required at least seven days advance notice. SB 878 would have required employers to pay “modification pay”—defined as compensation in addition to regular pay (the hourly rate calculated based upon 90 days prior)—if any scheduled shift is canceled, moved, or added, and for each shift for which an employee is required be on call but is not called into work.

Meal and Rest or Recovery Periods. AB 1948 would have provided a statutory remedy for an employer’s failure to provide a meal or rest or recovery period. The bill would have specified that the entire “penalty amount” was an additional hour or pay for each day that a meal or rest or recovery period was not provided to the employee.

California Workplace Flexibility Act. SB 985, SB 368’s predecessor, would have allowed employees to submit a written request for a flexible work schedule of up to four 10-hour days per week without obligating the employer to pay overtime for the 9th and 10th hours worked per day. The employer would have been obligated to pay overtime for any hours worked over 10 hours per workday or 40 hours per workweek.

Age Information in Employment. AB 984 would have prohibited an employer from using information obtained via websites regarding a person’s age to discriminate against an employee or applicant for employment. The bill also would have specified that a service provider is considered as doing business in this state and subject to California’s antidiscrimination laws when they knowingly accept payment from persons in California in exchange for posting their resumes and professional photos online.

Voluntary Veterans Preference Policy. AB 1383 would have created the Voluntary Veterans’ Preference Employment Policy Act to authorize a private employer to establish a written veterans’ preference employment policy. The bill also would have specified that granting a veteran preference, in and of itself, would not violate any local or state equal employment opportunity law or regulation, including, but not limited to, FEHA; and would have prohibited a veterans’ preference employment policy from being established or applied for the purpose of discriminating against an employment applicant on the basis of a protected classification.

Independent Contractors. AB 1727 would have established rights for independent contractors to organize and negotiate with “hosting platforms.” This bill would have provided a right for independent contractors to engage in “group activities” in an effort to negotiate through activities such as withholding work and boycotting or critiquing labor practices. The bill would have authorized an independent contractor or a representative of independent contractors claiming a violation under this bill to bring an action in superior court and to seek injunctive relief.

Employment Arbitration Agreements Discrimination. AB 2879, the “Service Member Employment Protection Act,” brought back the language of 2015’s AB 465, which the Governor vetoed (read our summary here), but limited the application to military service members, similar to USERRA. Specifically, the bill would have prohibited employers from requiring service members to waive any Labor Code protections, including the right to file and pursue a civil action or complaint, and would have prohibited employers from requiring service members to accept private arbitration, as a condition of employment, unless the waiver was “knowing and voluntary and not made as a condition of employment.”

DLSE Enforcement. AB 2261 would have provided the Department of Labor Standards Enforcement (DLSE) with new independent authority to, with or without an employee complaint, bring an action against an employer that it suspects may have terminated or otherwise discriminated against an employee in violation of any law under the jurisdiction of the Labor Commissioner. The authors of this bill argued that despite laws providing employees protection and encouragement to report abuse, the reality is that many workers do not report out of fear of losing their jobs. AB 2261 was built upon AB 970, which the Governor signed into law last year, and which we wrote about here.

Employee Safety. AB 2895 would have required an employer to keep at each worksite with three or more employees a complete, updated copy of the currently required written injury prevention program and make it available for inspection by any employee or by the Division of Occupational Safety and Health upon request. The bill would have also required an employer to inform each employee of the availability, and employee’s rights, to inspect and receive a copy of the injury prevention program. Additionally, an employer that received a written request would have had to  comply within a specified timeframe. The bill would have also entitled the employee to injunctive relief if the employer did not timely respond to the request.

Human Trafficking Training. AB 1595 would have required public and private mass transportation providers (bus, train, light rail, etc.) to provide training to recognize and report the signs of human-trafficking to employees who were likely to interact with victims of human trafficking. AB 1942 would have required the same training as AB 1595 but it was specific to hotels and motels that provide lodging services.

Sexual Offenses Against Minors. AB 2199 would have defined a two-year sentence enhancement where a defendant who committed a sex crime against a minor held a position of authority over the minor. The bill specifically provided that a person in a “position of authority” included, but was not limited to, a stepparent, foster parent, partner of the parent, youth leader, recreational director, athletic manager, coach, teacher, counselor, therapist, religious leader, doctor, or employer, or employee of one of the aforementioned persons.

PAGA. AB 1317 expanded on last year’s bill, AB 1506, which was signed by the Governor, that gave employers a limited right to cure certain wage-statement violations before an aggrieved employee could sue under PAGA. This bill would have provided an employer a right to cure any violation of the Labor Code before an employee could sue and would have provided an appropriation to the Labor and Workforce Development Agency to establish new positions to review and investigate PAGA cases. This bill was stuck in the Senate committee on rules.

PAGA Reform. None of the bills in this year’s five-bill Private Attorneys’ General Act (PAGA) reform package made it out of the Assembly. Those bills were:

  • AB 2461 would have limited the violations an aggrieved employee was authorized to bring and required specific procedures before suing.
  • AB 2462 would have provided employers with a right to cure before an employee brought a civil action.
  • AB 2463 would have established a penalty cap of $1,000 for each aggrieved employee.
  • AB 2464 would have authorized a court to dismiss an action if the court found the aggrieved employee suffered no appreciable physical or economic harm.
  • AB 2465 would have required the Labor and Workforce Development Agency to investigate alleged violations and determine if there was a reasonable basis for a civil action.

Workplace Solutions.

Head spinning?  We’ll summarize all the new and almost-laws and give you practical tips to prepare for them in our webinar on October 6.  Register here.  Or feel free to contact any of the authors or your favorite Seyfarth attorney with any questions.