On January 8, 2025, California received a Major Disaster Declaration for the ongoing Southern California wildfires. As the devastating wildfires continue to rage across the Los Angeles area, employers may be wondering how they can support their Southern California workforces while remaining compliant with employment laws. Employers must consider a host of factors, including compliance with tax regulations and wage and hour laws, worker safety, leaves of absence, and worksite closures.
Below are some key tips for businesses with a Southern California presence to consider as they navigate the challenging weeks and months ahead.
Cal/OSHA compliance: Protecting employees from wildfire smoke
- The California Division of Occupational Safety and Health (Cal/OSHA) requires employers to protect employees exposed to wildfire smoke. Under California Code of Regulations, Title 8, §5141.1:
- Where an employer’s workforce is in an enclosed building, employers should make certain air is filtered by a mechanical ventilation system and should ensure that windows, doors, bays, and other openings are kept closed, except when it is necessary to open doors to enter or exit.
- Where an employer’s workforce is outdoors, or where the employer should reasonably anticipate that employees may be exposed to wildfire smoke, employers must:
- Identify harmful exposures at the start of each shift and periodically thereafter, if required;
- Implement a system for communicating wildfire smoke hazards with employees;
- Provide effective training; and
- Reduce workers’ exposure to wildfire smoke by, among other options, providing an enclosed location with filtered air, relocating to another outdoor location, changing work schedules, reducing work intensity, providing more rest periods, and/or providing respiratory protective equipment.
Legally protected leave and leave banks
- Under the Family and Medical Leave Act and the California Family Rights Act, employees are entitled to up to 12 weeks of protected leave to tend to themselves or loved ones suffering a serious health condition, including those caused or worsened by the wildfires.
- Additional leaves of absence may be available to employees as well, including potentially based on school closures pursuant to California Labor Code Section 230.8. Some employees may also be eligible for voluntary firefighter and other civil servant leaves of absence.
- During Presidentially declared national disasters, IRS rules permit employers to set up a leave-sharing plan permitting employees to deposit leave for use by other employees who have been impacted by the disaster. An employee who deposits leave should not face any negative income tax consequences, as they need not report the deposited leave as income or wages. On the other hand, employees who deposit leave may not claim an expense, charitable contribution, or loss deduction with respect to the deposited leave.
Support employees through qualified disaster assistance payments
- Internal Revenue Code Section 139 provides tax advantages to employers who support employees affected by “qualified disasters.”
- Under Section 139, employers may make payments to affected employees “for the benefit of an individual to reimburse or pay reasonable and necessary personal, family, or funeral expenses incurred as a result of a qualified disaster” that is not otherwise compensated by insurance. Qualified expenses include expenses related to medical care, temporary housing and transportation, repair and rehabilitation of residences, and repair and replacement of some household items.
- These payments are deductible to the employer as business expenses if they meet the IRS’s requirements.
Wage and hour issues: Compliance with the Fair Labor Standards Act and California law
- As a reminder, if an exempt employee works for any portion of a workweek, an employer must pay that employee for the entire week, regardless of whether the employee is able to report to the worksite, unless they are absent for a full workday due to personal reasons, sickness, accident, or intermittent Family and Medical Leave Act and California Family Rights Act leave.
- In addition, despite the exigent circumstances, employers must still record and track all hours that non-exempt employees work and must compensate them for overtime hours worked as usual. This is particularly important given that California’s state overtime laws differ materially in several respects from federal law.
WARN compliance: Worksite closures
California’s Worker Adjustment and Retraining Notification Act (Cal-WARN) generally requires covered employers to provide written notice 60 days prior to a plant closing, mass layoff, or relocation of 50 or more employees to a location more than 100 miles away during a 30-day period. However, notice is not required where a “physical calamity” necessitates the plant closure, mass layoff, or relocation.
Other general best practices when facing disaster
- Have a disaster contingency plan in place to best deal with natural disasters as they arise.
- Ensure that all employee emergency contact information is accurate and up to date.
- Maintain open lines of communication with workers, sending regular updates about office closures, available resources, and contingency plans to workers’ personal contact information.
- Consider suspending in-office policies in favor of remote work, adjusting work hours, and providing leave to accommodate the impacted workforce. Ensure all policies are applied neutrally and consistently.
Other Reed Smith resources
Reed Smith stands with the Southern California wildfires’ victims, which include many of our colleagues. Our thoughts and prayers are with the entire region, especially those under mandatory evacuation orders. If you have experienced property damage as a result of the wildfires, please see our 2025 California Wildfires Resources Guide for additional information and resources.