2019 Labor and Employment Law Updates

To all California Employers and Employees –
Please note all of these new California employment laws, effective January 1, 2019, which affect your workplace:

1. Reminder: Minimum Wage Increase

Most of you are aware of the increase to the minimum wage, but employers should also be sure the salaries of their exempt “executive,” “administrative,” and “professional” employees are increased accordingly to be twice the minimum wage. Please refer to the chart below:

To sum up, exempt employees must receive an annual salary of $49,920 if the employer has 26 or more employees and $45,760 if there are 25 or fewer employees. If employees are not paid at these rates and/or do not meet the exempt duties tests to be salaried, the employer must pay overtime rates and provide other benefits required for all non-exempt, hourly employees. Employers, please do not assume you can pay any employee a salary. Check with us to confirm that their job duties fit within an approved exemption.

2. Independent Contractors: New “ABC” Test

The California Supreme Court dramatically tightened California rules governing whether workers are independent contractors or employees in its 2018 decision in Dynamex Operations West, Inc. v. Superior Court of Los Angeles. All “contract” or non-employee workers must meet all three requirements of the new “ABC Test.” Courts, government agencies and others will analyze whether:

A. the worker is truly free from the employer’s control and direction;

B. the worker is in a trade, occupation or business which is truly independent from the employer’s business; and

C. the worker is performing work outside the usual course of the employer’s business.

If the “contractor” does not meet all 3 criteria, the person is by default an employee (currently and retroactively). Companies or individuals who hire these persons could be exposed to government audits or lawsuits seeking wages, penalties, fines, interest and attorney fees for mischaracterizing such workers.

To limit exposure to the Labor Code penalties for doing so, please give us a call. For additional information on Dynamex, please see our recent blog post entitled “Misclassifying Independent Contractors? It’s Easy as A-B-C!” at http://www.karensloatlaw.com/blog.

3. Expanded Sexual Harassment Training

A new California law has expanded the statutory requirement to provide Sexual Harassment Prevention Training. Existing law required that employers with 50 or more employees provide only supervisory employees with at least 2 hours of such training within 6 months of assuming their supervisory positions, and to repeat the training every 2 years thereafter.

The new law also requires employers with only 5 or more employees (including temporary or seasonal employees) to provide all nonsupervisory employees with at least one hour of training every 2 years. This initial training must be provided by than January 1, 2020.

To make sure you’re providing all training required under the law, please give us a call. We also offer interactive, in-person Sexual Harassment Prevention Training for both supervisors and non-supervisors. Contact our office for more information.

4. Women on Corporate Boards of Directors

Publicly-traded corporations with principal offices in California are now required to have certain minimum numbers of female directors on their corporate boards. This requirement varies by year and size: each such corporation must have at least one female director by December 31, 2019. By December 31, 2021, corporations with five directors must have at least two female directors, and those with six must have at least three female directors.

The Secretary of State can impose fines of $100,000 or more for first violations, and $300,000 for subsequent violations. The Secretary of State will also publish reports documenting the number of corporations in compliance with this law.

If you have any question about whether your corporation needs to meet these requirements, please call our office.

5. Settling Sexual Harassment Cases: NO More Secrets

In a reaction to the #metoo movement and other recent events, new law prohibits settlement agreements in which the victim of a sexual assault, sexual harassment or sex discrimination is required not to disclose the fact of the harassment after settling a civil action or an administrative action. The laws further prohibit nondisclosure provisions where the victim asserted (and settled) claims that an employer failed to prevent workplace harassment or discrimination, or claims that the victim suffered retaliation after reporting sexual harassment or discrimination.

Essentially, this means that settlement funds no longer buy confidentiality or silence. Employers also cannot exchange a raise, promotion or other employment perk for releasing these claims.

Please contact us wherever this type of dispute arises so we can guide you through a resolution and a proper settlement agreement.

6. Job Applicant Salary and Criminal History

Employers are still prohibited from inquiring directly or indirectly about applicants’ salary and certain criminal histories but can be required to provide the employer’s pay scale to an applicant for a position, if the applicant requests it.

To make sure your pre-employment inquiries and procedures don’t inadvertently violate the applicable Labor Code prohibitions, please call our office.

7. Wages for Incidental or ‘Trivial’ Time Periods

Employees who clocked out but are still on the employer’s premises and do work — for example, if a supervisor asks them a question or two on their way to their vehicle in the parking lot — are entitled to have that time paid. Also, small increments of work time—e.g., starting up the computer—are not supposed to be rounded “down” and can be compensable.

Contact our office for tips on accurate timekeeping methods.

8. New 2019 IRS Standard Mileage Rates

Starting January 1, 2019, the IRS has increased the standard mileage rate to 58 cents per mile (up 3.5 cents from 2018). The medical or moving driving rate has also increased to 20 cents per mile (up 2 cents from 2018). Please note that the charitable organization rate of 14 cents per mile remains unchanged.

Please contact our office with if you have any questions regarding employee mileage or other business-related reimbursements.

9. New Parent Leave Act

Employers with 20 or more employees must give up to 12 weeks of unpaid leave to an employee to bond with a new child within one year of birth, adoption, or foster care placement. The employee must have been employed for more than 12 months, worked at least 1,250 hours during the previous 12 months, and work at a worksite with at least 20 employees within a 75-mile radius. Employers can’t require employees to use paid time off, vacation or sick leave for this purpose and must provide a guarantee of reinstatement, or risk being sued.

If you have a ‘new child’ situation arise and are at all unsure of your obligations under this new statute, please give us a call.

10. Lactating Mothers

Employers must make more “reasonable efforts” to provide a private place for employees who need to express breast milk for infants which is “in close proximity to the employee’s work area.” A restroom is not sufficient for this purpose.

If you need guidance on lactation requirements, please give us a call.

See our Resources page at: www.karensloatlaw.com/resources for new hire forms and other governmental forms and pamphlets, conveniently gathered for you to download, use or complete for all employees. Remember, we offer employers a complimentary review of Employee Handbooks, Personnel Policies and Personnel Forms.

Get in touch with us if you have any questions about these new laws, our 2019 Employment Law updates, or anything on our Resources page. We’re happy to help!