In the world of employment law, staying ahead of constantly evolving laws and workplace legislation is important. In the new year, California employers will want to be sure they are ready for these key legislative changes related to employment.
Independent Contractor Status – AB 5
Assembly Bill 5, also known as the “Gig Economy Bill”, imposes a new test for determination of employment status and impacts companies that employ independent contractors in California. It adopts the “ABC test” for determining independent contractor status which was articulated by the Supreme Court in a case decided in 2018, Dynamex Operations West v. Superior Court of Los Angeles. AB 5 expands the Dynamex ruling to apply the “ABC test” to all provisions of the Labor Code and Unemployment Insurance Code, unless otherwise stated. It provides important exemptions for certain industries, including construction, real estate agents, doctors, attorneys, architects, engineers and accountants.
Determining Employment Status
To minimize independent contractor risk, employers should address each factor in the “ABC test” to determine if a worker is an independent contractor.
- “A” Factor: Is the worker free from the control and director of the hiring entity?
- “B” Factor: What is your business? Is the contractor doing something integral to your business? Would an outsider view them as working within your business?
- “C Factor”: What type of business is your contractor engaged in?
Businesses that utilize independent contractors on any regular basis to perform tasks that are an integral part of their operations may be compelled to transition these workers to employees. Read this article for more information on the new test for determining employment status.
Arbitration Agreements – AB 51
Assembly Bill 51 prohibits employers from requiring employees to enter into mandatory arbitration agreements. However, employees can still voluntarily enter into mandatory arbitration agreements. The law applies to arbitration agreements entered into or modified after January 1, 2020.
Implement Voluntary Arbitration Agreements
Employers who relied on mandatory arbitration agreements to resolve employment-based disputes must reevaluate their policies and practices. Consider these steps to manage the implementation of voluntary arbitration agreements in your organization.
- Use bold language advising employees that signing the agreement is entirely optional and that they will not be retaliated against for declining to sign the agreement.
- Individually negotiate consideration with each employee.
- Existing arbitration agreements are not invalidated.
- Confirm existing arbitration agreements are dated prior to December 31, 2019.
- Consider whether the company wants to require employees to sign arbitration agreements prior to December 31, 2019.
Learn more about what AB 51 means for California employers here.
Protected Hairstyles – SB 188
California is the first state in the nation to ban employers and school officials from discriminating against people based on their natural hairstyle. Senate Bill 188, also known as the CROWN Act: Creating a Respectful and Open Workplace for Natural Hair, addresses unfair grooming policies that have a disparate impact on black women, men and children and draws attention to cultural and racial discrimination taking place within workplaces and schools. The law takes effect January 1, 2020 and makes it illegal to enforce dress code or grooming policies against hairstyles such as Afros, braids, twists and locks. For more information, read this blog article.
Sexual Harassment – AB 9
Assembly Bill 9 is the Stop Harassment and Reporting Extension (SHARE) Act. It extends the deadline to file an allegation of unlawful workplace harassment, discrimination or civil rights related retaliation under FEHA from one to three years. AB 9 imposes a statute of limitations that is six times the length of the federal standard.
Lactation Accommodation – SB 142
Senate Bill 142 requires employers to provide a lactation room or location for employees who are nursing. The location needs to include access to a sink and refrigerator in close proximity to the employee’s workspace. The law deems denial of reasonable break time or adequate space to express milk a failure to provide a rest period. It prohibits an employer from discharging, discriminating or retaliating against an employee for exercising these rights. Employers with fewer than 50 employees may seek an exemption if it poses an undue hardship by causing the employer significant difficulty or expense.
If we can help with your training or legal needs in the coming year, please contact us.
