California has recently issued numerous updates that employers must adhere to in order to comply with the law. The following is a portion of the updates that might affect your company. These are provided simply to make you aware of the new requirements. Not all of the updates will apply to your company.
Compliance Updates
Proactive alerts when employment laws change that may affect your company's policies, procedures or compliance
CA Supreme Court: On-Call Rest Doesn't Satisfy Break Requirement
January 19, 2017
The California Supreme Court has ruled that during rest breaks, employers must relieve their employees of all duties during their break time. Employers do not satisfy these requirements when they require employees to remain on-call during their break.
Background:
Under California law , employers must permit non-exempt employees to take an uninterrupted rest period for a minimum o fraction thereof) worked, unless an employee works less than 3 .5 hours in workday. A rest period is considered time worke
Example: If a non-exempt employee works 6.5 hours, the employer must provide the employee with two paid rest breaks,4.0 hours worked , and the second covers the remaining 2.5 hours worked (required because 2. 5 is a major fraction of four hours).
Employers that fail to provide employees with required rest periods must pay the employee one additional hour of pay for each rest period that is not provided.
California Supreme Court Case:
In the case before the California Supreme Court, security guards alleged that their employer violated the state's rest break pagers on, remain vigilant, and respond when necessary during breaks.
In its ruling, the Court concluded that during rest periods, employers must relieve employees of all work- related duties during their break time.The Court also found that requiring employees to remain on-call during rest periods fails to satisfy the obligation of an employer to provide an employee break time undisturbed by the employer.
Compliance Recommendations:
Non-exempt employees should be allowed to take their rest periods relieved of all duties and employer control. Review your handbook so it complies with this decision. Note: The California Meal& Break Periods policy has been updated in HR41l".
Department of Labor Increases Fines
July 11, 2016
The Department of Labor has published a rule increasing fines for violations of the Occupational Safety and Health Act (OSH Act), the Fair Labor Standards Act (FLSA), and other laws it enforces.
The following is a summary of some of the changes , effective August 1, 2016:
• The maximum penalties for serious OSH Act violations will increase from $7,000.00 to $12,471.00 .
• The maximum penalty for willful (or repeated) OSH Act violations will increase from $70,000.00 to $124,709.00.
• The penalty for willful violations of the FLSA's minimum wage and overtime provisions increases from $ 1,100.00 to $1,894.00.
The changes are a result of the Federal Civil Penalties Inflation Adjustment Act of 2015 which directs agencies to adjust their civil monetary penalties for inflation every year.
The new amounts will apply to penalties assessed after August 1, 2016, for violations occurring after November 2, 2015 (the date the Federal Civil Penalties Inflation Adjustment Act was enacted).
Compliance Recommendations:
The new penalties are a reminder to remain diligent about compliance with the OSH Act and the FLSA, particularly in light of new overtime rules that became effective December l, 2016.
California Clarifies Anti-Harassment Policy Requirements
March 16, 2016
The California Department of Fair Employment and Housing (DFEH) has published regulations clarifying the state's requirements for preventing and correcting sexual harassment. Among other things, the regulations specify what must be included in sexual and other unlawful harassment policies. The regulations were effective April 1, 2016.
Overview:
The regulations state that employers have an affirmative duty to take reasonable steps to prevent and promptly correct discriminatory and harassing conduct, including sexual harassment, gender harassment, and harassment based on pregnancy, childbirth, or related medical conditions. Employers also have an affirmative duty to create a workplace environment that is free from unlawful employment practices. Employees, interns, volunteers and contractors are all protected under the Fair Employment and Housing Act (FEHA).
Required Policy Components:
The regulations require that in addition to distributing the Department's DFEH-185 brochure on sexual harassment, employers must develop a written policy that includes the following elements:
• All current protected categories covered under the FEHA, including sex, race, national origin, color, ancestry, age, disability, religion, military status, veteran status, genetic information, medical condition, marital status, gender, gender identity, gender expression, and sexual orientation;
• That the law prohibits coworkers and third parties (including vendors, clients, or customers), as well as supervisors and managers, with whom the employee comes into contact, from engaging in conduct prohibited by the FEHA;
A complaint process to ensure that complaints:
• Are confidential, to the extent possible;
• Addressed and closed in a timely manner;
• Trigger an impartial and timely investigation by qualified personnel;
• Are documented and tracked for reasonable progress; and
• Will result in appropriate remedial action and resolution, if applicable.
• A complaint mechanism that does not require an employee to complain directly to his or her immediate supervisor, including, but not limited to, the following:
• Direct communication. either orally.or in writing. with a designated company representative. such as a human resources manager. EEO officer. or other
California Expands Anti-Retaliation Protections
October 21, 2015
California Governor Jerry Brown has signed legislation (Assembly Bill l509) expanding the state's anti-retaliation law to protect employees' family members. Assembly Bill 509 became effective January, 2016.
Background:
Collectively, California Labor Code Section 98.6 and Section 1102.5 prohibit employers (or persons acting on behalf of the employer) from taking adverse action against an applicant or employee for, among other things:
• Exercising any right covered by the Labor Code
• Filing a complaint with the labor Commissioner
• Disclosing information to the government or certain other entities if the individual has reasonable cause to believe that the information discloses a violation of local, state or federal law, rule or regulation
Assembly Bill 1509:
Assembly Bill l509 amends Section 98.6 and Section 1102.5 to also prohibit retaliation against employees whose family members have, or are perceived to have, engaged in protected activity.
Compliance Recommendations:
California employers should review policies, practices, and supervisor training to ensure compliance with the expanded anti-retaliation provisions.
OSHA Changes, Clarifies Recordkeeping Rules
June 13, 2016
The Occupational Safety and Health Administration (OSHA) has published a final rule that requires employers in certain industries to submit injury and illness data to the agency electronically. The rule also makes changes to requirements for how employers must inform employees about their rights and responsibilities under OSHA and clarifies employees' rights to access injury and illness records. The rule became effective August 10, 2016, but the electronic submission requirements will become effective in 2017
Background:
Under existing rules, employers with more than 1O employees must keep records of work-related injuries and illnesses, unless they are classified under one of the partially exempt low- hazard industries.
Employers covered by these rules must:
1. Record each recordable employee injury and illness on an OSHA Form 300 (Log of Work-Related Injuries and Illnesses).
2. . Prepare a supplementary OSHA Form 30 1 (Injury and Illness Incident Report) that provides additional details about each case recorded on Form 300.
3. At the end of each year, prepare a summary report of all injuries and illnesses on OSHA Form 300A ("Summary of Work-Related Injuries and Illnesses"), and post the form in a visible location in the workplace.
These requirements do not change under the new rule.
Electronic Filing:
The new rule requires certain employers to file OSHA forms electronically. OSHA intends to publish employers ' injury and illness data on a publicly accessible website.
Employers with 20 to 249 employees in certain designated industries must submit information from Form 300A to OSHA electronically on an annual basis. Employers with 250 or more employees must submit information from Forms 300, 300A, and 301 to OSHA electronically on an annual basis. Other employers may also be asked by OSHA to report electronically.
The electronic submission requirements will be phased in as follows :
Employer Size
Forms Required to Be Filed Electronically
20 to 249 employees and in one of these industries must submit OSHA Form 300A
electronically beginning July 1, 2017
Final Overtime Rules Effective December 1, 2016: What You Need to Do to Prepare
May 18, 2016
The Department of Labor (DOL) has announced a final rule that will increase the minimum salary requirement for the administrative, professional, executive, and highly compensated employee exemptions. The final rule became effective December 1, 2016.
Background:
The Fair Labor Standards Act (FLSA) requires virtually all employers to pay most employees at least the federal minimum wage for each hour worked, as well as overtime pay for all hours worked in excess of 40 in a workweek . The FLSA allows for exemptions from these overtime and minimum wage requirements for certain "exempt" employees. To be considered "exempt," these employees must generally satisfy specific salary and duties tests:
• Meet the minimum salary requirement ;
• With very limited exceptions, the employer must pay the employee their full salary in any week they perform work, regardless of the quality or quantity of the work; and
• The employee's primary duties must meet certain criteria.
Final Rules:
New Salary Requirements
Administrative, Professional , Executive Exemptions:
Effective December l, 2016, the minimum salary requirement for the administrative, professional (including the salaried computer professional), and executive exemptions will increase from $455 per week to $913 per week (or from $23,660 per year to $47,476 per year). This means that employees who meet the administrative, professional, and executive exemptions must be paid a minimum weekly salary of $913 in order to be exempt from the FLSA's minimum wage and overtime requirements . Exempt computer employees may also be paid hourly, if it is at least $27.63 per hour, which doesn't change under the new rule.
Note: The minimum salary for these exemptions is less than the DOL had initially proposed.
New HRA Benefit Plans for Small Employers Permitted
December 13, 2016
President Obama has signed legislation (HR 34 - the 21st Century Cures Act, or the Act) that will allow small employers to offer stand-alone health reimbursement arrangements (HRAs) to employees that have purchased a health plan in the individual market, as long as certain conditions are met. The law is effective January 1, 2017
Background
Under the Affordable Care Act (ACA), employers that do not meet the definition of an Applicable Large Employer (ALE) are required to either provide health plans that meet certain requirements to their full-time employees or pay a penalty to the Internal Revenue Service (IRS). Many employers that are not ALES have wanted to offer limited health benefits to their employees, but have generally been prohibited from offering such benefits, including through HRAs that are not integrated with other employer coverage, that do not meet ACA coverage and cost-sharing requirements. Employers faced significant IRS penalties of $100 per "affected individual" per day, for offering HRAs to cover health insurance costs for the purchase of plans on the individual market.
Under the 21st Century Cures Act, eligible small employers can now offer Qualified Small Employer Health Reimbursement Arrangements (QSEHRAs) without being subjected to these penalties. The Act stipulates that a QSEHRA is not a group health plan under the Internal Revenue Code or ERISA and is not subject to ACA coverage and cost-sharing requirements. Benefits under a QSEHRA are not subject to income or employment taxes. Provisions of a QSEHRA may affect the amount of an individual's premium assistance tax credit for purchase of insurance on a health insurance exchange.
The following conditions must be met: Eligible Small Employers
To be eligible, employers must:
• Not be an ALE (i.e., must have an average of fewer than 50 full-time and full-time equivalent employees, excluding seasonal workers , in the prior calendar year); and
• Offer no group health plan to any of its employees.
Eligible Employees
The QSEHRA must generally be offered to all employees, except those who are:
• Part-time;
• Seasonal;
• Under the age of 25 ;
• Within the first 90 days of service with the employer.
Los Angeles Restricts Criminal History Inquiries
December 20, 2016
Los Angeles has enacted Ordinance No. 184652, which will restrict employers from asking applicants about their criminal history and require employers to take certain steps before taking adverse action based on criminal history information. The Ordinance took effect on January 22, 2017.
Coverage:
The Ordinance applies to private employers with l0 or more employees and employees who:
• Perform at least two hours of work on average each week within the geographic boundaries of the city; and
• Qualify as an employee entitled minimum wage under the California minimum wage law, as provided under Section 1197 of the California Labor Code and wage orders published by the California Industrial Welfare Commission.
Restrictions on Criminal History Inquiries:
Employers are prohibited from asking about criminal history on application forms and must wait until they extend a conditional job offer before seeking criminal history information.
Pre-Adverse Action Requirements:
Once employers extend a conditional job offer, they may seek criminal history information. Before taking adverse action based on an applicant's criminal history, employers must complete a written assessment that links the specific aspects of the applicant's criminal history with the risks inherent in the job sought.
Conducting an Assessment:
In performing the assessment, employers must, at a minimum, consider the factors identified by the United States Equal Employment Opportunity Commission (EEOC), including the nature and gravity of the offense, the time that has passed since the offense, and the nature of the job sought. This may include:
• The facts or circumstances surrounding the offense;
• The number of offenses;
• Age at the time of conviction, or release from prison;
• Evidence that the individual performed the same type of work, post-conviction, with no known incidents of criminal conduct;
• The length and consistency of employment history before and after the offense;
• Rehabilitation efforts (such as education or training);
• Employment or character references and any other information regarding fitness for the particular position; and
• Whether the individual is bonded under a federal, state, or local bonding program.
As mentioned, some of these new changes may not affect your company. It is highly recommended that you review your Policy and Procedures Manual or Company Handbook to ensure that you are in compliance with those new changes that do apply to you.
