The deadline for California’s Governor to sign, approve without signing, or veto bills on his desk was September 30, 2022. We have compiled a comprehensive list of the major new laws and obligations that employers in the Golden State should know. As always, it is wise to consult with counsel to ensure that workplace policies
Supreme Court Rules in Favor of Arbitrability of PAGA Action
In a highly-anticipated decision, the U.S. Supreme Court issued its opinion in Viking River Cruises, Inc. v. Moriana (Case No. 20-1573) on June 15, 2022. The Court examined whether the Federal Arbitration Act (FAA) preempted California court precedent, which invalidated contractual waivers of representative claims under California’s Private Attorneys General Act of 2004 (PAGA).
Under PAGA, an employee may sue their current or former employer as a representative of the California Labor and Workforce Development Agency (“LWDA”). In such an action the employee can seek penalties for alleged violations of the Labor Code suffered by the employee themselves and other allegedly “aggrieved employees” if the employee was subjected to one or more violations of the California Labor Code.
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California Supreme Court rules additional penalties may be recoverable for meal and rest period violations
On May 23, 2022, the California Supreme Court handed down its decision in Naranjo v. Spectrum Security Services. The decision discusses the penalties recoverable by employees for an employer’s alleged failure to pay meal and rest period premiums where a proper meal or rest period is not provided. The Naranjo Plaintiffs filed a putative class action lawsuit alleging that his employer failed to provide meal and rest periods or premium compensation in lieu thereof as required by California law. In addition to premium pay for meal and rest periods, Plaintiffs also brought derivative claims alleging failure to timely pay wages at termination and failure to provide accurate wage statements. Specifically, Plaintiffs argued that because meal and rest period premiums were not paid, they also were not timely paid all wages due at termination and their wage statements were invalid because they did not reflect the premiums that were not paid.
BREAKING: Federal Appeals Court reinstates OSHA vaccine ETS
On December 17, 2021, the Sixth Circuit Court of Appeals dissolved the stay previously placed on OSHA’s so-called “vaccinate or test” Emergency Temporary Standard (ETS). Consequently, covered employers with 100 or more employees will now be required to comply with the ETS under the newly announced deadlines of January 10, 2022 for all non-testing requirements
Ninth Circuit rules to lift preliminary injunction on California’s ban on mandatory employee arbitration agreements
A split Ninth Circuit panel vacated a 2020 preliminary injunction that blocked the enforcement of California’s A.B. 51, which prohibits mandatory arbitration clauses in employment contracts. If the majority decision stands, it will mean that California employers can no longer require their employees or new hires to sign arbitration agreements (among other types of waivers)
Ninth Circuit reverses preliminary injunction: California’s independent contractor law applies to motor carriers
In a split 2-1 decision, the Ninth Circuit Court of Appeals reversed the district court’s order preliminarily enjoining enforcement of California’s Assembly Bill (AB) 5 in California Trucking Association et al. v. Bonta (CTA). If this ruling is not appealed, AB 5, which is chaptered in the California Labor Code under 2750.3, will no longer be enjoined from applying to companies in the trucking industry.
In 2019, the California legislature enacted AB 5 to codify the California Supreme Court’s decision in Dynamex West Operations, Inc. v. Superior Court (2018). In Dynamex, the Court judicially adopted the “ABC test” for employers to pass before classifying a worker as an independent contractor. Prior to the Dynamex ruling, courts applied the multi-factor Borello balancing test to determine the status of a worker.
Over 30 states now apply the ABC test. Subject to some statutory exemptions, in California, the law provides that a worker is presumed to be an employee unless: (a) the worker is free from control and direction of the hiring entity under both in practice and under contract; and (b) the worker performs work outside of the usual course of the hiring entity’s business; and (c) the worker is customarily engaged in an independently established trade, occupation or business of the same nature of the work performed.
Cal-OSHA released proposed revisions to the COVID-19 prevention order
UPDATE on May 20, 2021: Since this article was published, Cal/OSHA has delayed the vote on the new proposed Emergency Temporary Standards. Please read details on the delayed vote on the Reed Smith EHS Law Insights Blog.
As vaccination rates increase in California, the California Department of Occupational Safety and Health (Cal-OSHA) has released a draft of a new proposed COVID-19 emergency regulation. The California Occupational Safety and Health Standards Board will vote on whether to send the proposed regulation to the Office of Administrative Law (OAL) on May 20th. After it is received, the OAL is only required to allow five calendar days for submission of comments and 10 calendar days for review before filing with the Secretary of State. Given this timeline, it is likely that the new regulations will become effective in early June.
The new COVID-19 emergency regulations loosen a number of the prior requirements for fully vaccinated workers. The new COVID-19 emergency regulations, however, also add a number of new compliance requirements for employers. In that regard, the new proposed regulation contains many important changes to how face coverings and N-95 masks must be used, testing and exposure requirements, and the prior exclusion and wage replacement rules. The key changes in these areas are briefly summarized below:
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San Francisco mandates certain workers be rehired in emergency ordinance
Effective July 3, 2020, San Francisco’s Back-to-Work Emergency Ordinance (Emergency Ordinance) seeks to mitigate the economic harm for individuals who are unable to work due to the COVID-19 public health emergency by creating a temporary right to reemployment for certain employees laid off due to the coronavirus pandemic if their employer seeks to fill the same, or substantially similar, position previously held by a laid-off worker. The Emergency Ordinance also imposes written notice and record retention requirements on employers. The Emergency Ordinance expires on September 2, 2020 unless reenacted.
The Emergency Ordinance contains several key definitions that employers should refer to in order to determine whether any personnel action the employer is considering taking will be subject to the requirements therein. Of particular importance, the Emergency Ordinance defines Covered Layoff, Covered Employer and Eligible Employees as follows:
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California’s recent guidance for employers facing COVID-19 outbreaks
On June 16, 2020, the California Department of Public Health (CDPH) released guidance for employers responding to COVID-19 outbreaks in the workplace. An outbreak at a non-health care or congregate setting workplace is defined as three or more laboratory-confirmed cases of COVID-19 within a two-week period among employees who live in different households.
The guidance provides a road map for local public health departments (LHDs) and employers to use in understanding the steps that should be taken in response to an outbreak at work. In short, employers should be ready to report positive COVID-19 cases to the LHD and to collaborate with the LHD to coordinate a response to the outbreak.
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Returning to work during the COVID-19 pandemic: Employer’s rights and obligations to high-risk workers
The Equal Employment Opportunity Commission (EEOC) updated and expanded a Technical Assistance Publication on May 5, 2020, and then again on May 7, 2020, focusing on employer obligations under the Americans with Disabilities Act (ADA) and related laws during the COVID-19 pandemic. The EEOC’s guidance comes as many states are reopening their economies and allowing businesses to admit employees back into the workplace.
The Question-and-Answer format of the updated publication reminds employers of their obligation to continue to provide reasonable accommodations in the workplace, even in the middle of a pandemic. Of particular interest to employers are situations where the worker is already known to have a medical condition that the Centers for Disease Control and Prevention (CDC) has flagged as putting the individual at higher risk for severe illness from COVID-19. The full CDC list is available here, and includes people with moderate to severe asthma, severe obesity, diabetes, and many other impairments. The EEOC’s position regarding the employer’s rights and obligations when returning such individuals to the workplace has two key parts.