2018 Employment Law Changes
On January 1, 2018, several changes to California’s employment laws will take effect. Below is an overview of some of the most significant changes affecting California business owners.
Parental Leave for Small Employers
Senate Bill (“SB”) 63, referred to as the “New Parent Leave Act” requires all businesses with 20 or more employees to provide eligible employees up to 12 weeks of unpaid job-protected leave to bond with a new child within one year of the child’s birth, adoption or foster care placement. To be considered an “eligible employee” for the new parent leave, an employee: 1) must have worked for the employer more than 12 months; 2) must have worked at least 1,250 hours during the prior 12-month period; and 3) must work at a worksite where there are at least 20 employees within a 75-mile radius.
This new law will have the greatest impact on employers with 20 to 49 employees who are not currently required to provide baby bonding leave under the federal Family and Medical Leave Act or the state California Family Rights Act. If an employee takes this leave, an employer must maintain and pay for coverage under a group health plan at the same level and conditions that coverage would have been provided if the employee had continued working. Before the leave starts, an employer must provide the employee with a guarantee of reinstatement to the same or comparable position. Failure to provide the guarantee will be deemed a violation of the law, as if the employer refused to provide leave.
Under SB 63, potential legal exposure will arise for employers that do not provide the 12 weeks of protected leave, fail to return the employee to the same or a comparable position, fail to maintain benefits while the employee is out on leave, or take any adverse employment action against the employee for taking the leave.
Limitation on Criminal History Inquiries in the Hiring Process
Assembly Bill (“AB”) 1008 prohibits employers with 5 or more employees from asking about criminal history information on job applications and from inquiring about or considering criminal history at any time before a conditional offer of employment has been made. There are limited exemptions for certain positions, such as those where a criminal background check is required by federal, state or local law. Once an employer has made a conditional offer of employment, it may seek certain criminal history information; however, some criminal history information, such as sealed or expunged convictions and juvenile crimes, is still off limits.
After a conditional offer of employment is made, if an employer intends not to hire the applicant because of a prior conviction, the employer must first conduct an individualized assessment to determine whether the conviction has a direct and adverse relationship with specific job duties that justifies denying employment. The employer must consider specified factors in making this assessment. Any preliminary decision not to hire because of a conviction history requires written notice to the applicant, who must be given the opportunity to respond. A specific timeline and process must be followed. The employer must consider any information provided by the applicant before making a final decision.
If the employer makes a final decision to deny employment in whole or in part because of the criminal conviction, written notice to the applicant is again required. Specific information must be included in the final determination notice.
Under AB 1008, potential legal exposure will arise for employers who ask about an applicant’s criminal history in the interview process before a conditional offer is made, who fail to conduct an individualized assessment to determine whether the conviction has a direct, adverse relationship to the job duties, and who fail to provide the requisite written notices to the applicant being denied employment.
No More Salary History Questions
AB 168 bars employers from asking a job applicant about salary history, including information on compensation and benefits. Employers also are barred from seeking the information through an agent, such as a third-party recruiter.
This new law also prohibits employers from relying on salary history information as a factor in determining whether to hire the applicant or how much to pay the applicant. However, an employer may consider salary information that is voluntarily disclosed by the applicant without any prompting.
AB 168 also requires an employer to provide a job applicant, upon reasonable request, with the pay scale for the position.
Legal exposure under AB 168 will exist for employers who continue to inquire about salary history in the interview process or who fail to provide the applicant with pay scale information about the job for which they are interviewing.
Expansion of Harassment Prevention Training Requirements
Existing California law requires employers with 50 or more employees to provide supervisors with two hours of sexual harassment prevention training every two years. Under SB 396, covered employers will have to make sure that any mandatory training course they use also discusses harassment based on: 1) gender identity; 2) gender expression; 3) sexual orientation; and 4) anti-bullying in the workplace. The training content must include practical examples intended to address these types of harassment. Our firm provides this training. Please contact Dick Semerdjian, Sarah Evans, or Sierra Spitzer to discuss further.
SB 396 also requires employers to display a poster on transgender rights that the Department of Fair Employment and Housing will develop.
Increased Wage Liability for Construction General Contractors
For certain private construction contracts entered into after January 1, 2018, AB 1701 imposes liability onto the general contractor for any unpaid wages, benefits or contributions that a subcontractor owes to a laborer who performed work under the contract. For private works contracts entered on or after January 1, 2018, a direct contractor (i.e., general/prime contractor or contractor who has direct contractual relationship with an owner) must assume and be liable for any debt which its subcontractor or a lower tier subcontractor incurs for a wage claimant’s performance of labor included in the subject of the contract between the direct contractor and the owner. The bill does not apply to any work being done by an employee of the state or any political subdivision of the state.
The bill authorizes the direct contractor to request from subcontractors certain payroll records and information regarding the subcontractor’s and third party’s work on the project to confirm that wages and other benefits or contributions are being made. The bill provides that the direct contractor may withhold disputed sums upon the subcontractor’s failure to provide the requested information.
AB 1701 authorizes the Labor Commissioner to bring an action under specified statutes or in a civil action to enforce this liability. The bill also authorizes a third party owed fringe or other benefits to bring a civil action to enforce the liability against a direct contractor.
Worksite Immigration Enforcement and Protections
The Immigrant Worker Protection Act (AB 450) provides workers with protection from immigration enforcement while on the job. AB 450 prohibits employers from:
- providing federal immigration enforcement agents access to nonpublic areas of a business without a judicial warrant; and
- providing agents access to employee records without a subpoena or judicial warrant. (This second prohibition does not apply to Form I-9 or other documents for which a Notice of Inspection was provided to the employer. However, employers must follow specific requirements related to Form I-9 inspections.)
Regarding Form I-9 inspections, AB 450 requires employers to:
- Post a notice to all current employees informing them of any federal immigration agency’s inspections of Forms I-9 or other employment records within 72 hours of receiving Notice of Inspection. AB 450 requires that the notice contain specific information about the inspection and that it be posted in the language normally used to communicate employment-related information. Employers must comply with this posting requirement beginning January 1, 2018, even though the Labor Commissioner has until July 1, 2018, to create a model posting template. The notice must also be given to the collective bargaining representative, if any.
- Provide a copy of the federal Notice of Inspection to an affected employee upon reasonable request.
- Give each affected employee and the employee’s collective bargaining representative a copy of the inspection results and a written notice of the employer’s and employee’s obligations arising from the inspection. This must be done within 72 hours of receiving the results and specific information must be included. An “affected employee” is one identified by the inspection results as potentially lacking work authorization or having document deficiencies.
An employer that provides access in violation of AB 450 or fails to follow the notice requirements can be fined between $2,000 to $5,000 for a first violation and $5,000 to $10,000 for each subsequent violation.
The above is not a complete list of all new or changing employment laws for 2018. The attorneys at Schwartz Semerdjian consistently keep abreast of the changes in the laws affecting business owners. If you have questions about these new laws, or any other employment laws, please contact Ross Schwartz, Dick Semerdjian, Sarah Evans, Sierra Spitzer or Mark Bale.