On September 18, 2019, California Governor Gavin Newsom signed into law A.B. 5, solidifying a tighter standard of rules for classifying a worker as an independent contractor. The new standard, known as the Dynamex standard, codifies and expands the earlier California Supreme Court decision, Dynamex Operations West, Inc. v. Superior Court of Los Angeles. It replaces the former Borello test, and puts in place a more simple three-pronged ABC test. The significant effect is that many workers in California will now be classified as employees instead of independent contractors (also informally known as “1099” workers). This change is one of the most significant disruptions to California employment law in decades. The law will take effect on January 1, 2020.Continue reading
On September 18, 2019, California Governor Gavin Newsom signed into law A.B. 5, codifying a tighter standard of rules for classifying a worker as an independent contractor. The new standard, known as the Dynamex standard, codifies and expands the earlier California Supreme Court decision, Dynamex Operations West, Inc. v. Superior Court of Los Angeles. It replaces the former Borello test, and puts in place a more simple three-pronged ABC test. The significant effect is that many workers in California will now be classified as employees instead of independent contractors (also informally known as “1099” workers). This change is one of the most significant disruptions to California employment law in decades. The law will take effect on January 1, 2020.
The new law is convoluted, and has numerous exceptions for various professions, as discussed in further detail below. To further complicate matters, the law codifies Dynamex for purposes of claims made under the California Labor Code, Unemployment Insurance Code, and wage orders, but curiously does not mention the California Government Code, under which workers may seek redress for harassment and discrimination, among other things.
In addition, the newly created exemptions to the ABC test will apply “retroactively to existing claims and actions to the maximum extent permitted by law.”
In order to ensure that your company’s workers are properly classified (in order to avoid substantial fines and expensive misclassification lawsuits), contact a qualified employment law attorney as soon as possible to ensure you are complying with the law and following the new rules.
What Is the Potential Impact of This Change?
According to the LA Times, “State Capitol Democrats and organized labor say their new ‘gig’ law will correct the misclassification of 1 million California workers who are falsely deemed independent contractors.”Continue reading
It’s that time to update your payroll again! Twelve cities and counties throughout the state of California will again be updating their minimum wage. Until December 31, 2019, the current state-wide California minimum wage is $11.00 per hour for companies with 25 or fewer employees, and $12.00 per hour for employers with 26 or more employees. You can find the most updated information about California minimum wage on the Department of Industrial Relations website. The minimum wage shall be adjusted on a yearly basis through 2023 according to the pre-set schedule shown on the DIR website.
The following cities will be updating their minimum wage to reflect the following hourly rates below. Of note, some cities have different wages based on the number of employees they have–25 or less, or 26 or more:
- Alameda – $13.50
- Berkeley – $15.59
- Emeryville – $16.30
- Fremont (26 or more employees) – $13.50
- City of Los Angeles (25 or fewer employees) – $13.25
- City of Los Angeles (26 or more employees) – $14.25
- Unincorporated Los Angeles County (25 or fewer) – $13.25 (Unincorporated LA County generally mirrors the minimum wage rates in the City of Los Angeles)
- Unincorporated Los Angeles County (26 or more) – $14.25
- Malibu (25 or fewer employees) – $13.25
- Malibu (26 or more employees) – $14.25
- Milpitas – $15.00
- Pasadena (25 or fewer employees) – $13.25
- Pasadena (26 or more) – $14.25
- San Francisco – $15.59
- San Leandro – $14.00
- Santa Monica (25 or fewer employees) – $13.25
- Santa Monica (26 or more employees) – $14.25
Be sure to inform your payroll company or and accounting department of these changes. In addition, changes in minimum wage may affect an employee’s exempt or non-exempt status, so it’s important to review how the change in minimum wage may affect this classification.
It’s always a good idea to provide your employees with an updated Notice to Employee form that reflects their change in wages. This form must be distributed to employees by California Labor Code section 2810.5. Please check your employees’ personnel files to ensure this form has been provided to them, and reflects the company’s up-to-date Paid Sick Leave and worker’s compensation information.
For more information on California minimum wage, or to review your current employment law policies and documentation, contact The Grady Firm.
About The Grady Firm. P.C.
The Grady Firm, P.C. attorneys provide our clients with the tools to arm themselves and minimize risk with general employment law counseling; I-9 audits, custom Employee Handbooks; assistance with hiring, firing, discipline, leave, and termination; personnel file forms and audits; and sexual harassment and leadership training in English and Spanish. In addition, by combining years of experience as legal counsel for both U.S. and international companies, The Grady Firm acts as the outsourced Global Mobility Department for multi-national corporations seeking to move personnel across borders with visas and Green Cards based on employment, investment, and family relations.
Click here to schedule a complimentary 15-minute consultation with The Grady Firm’s attorneys; call +1 (323) 450-9010; or fill out a Contact Request Form.
*This article is for informational purposes only, and does not constitute legal advice or create an attorney-client relationship. This article does not make any guarantees as to the outcome of a particular matter, as each matter has its own set of circumstances and must be evaluated individually by a licensed attorney.
On September 30, 2018, Governor Jerry Brown signed into law S.B. 1343, which now requires that employers with 5 or more employees in California provide 1 hour of sexual harassment and abusive conduct training to non-managerial employees, and 2 hours for managerial employees once every two years. Managerial employees must receive training within 6 months of hire or promotion. New hires must receive training within 6 months of hire.
BY WHAT DATE MUST EMPLOYEES BE TRAINED?
Originally, all managerial and non-managerial employees must have received training by January 1, 2020. However, Governor Gavin Newsom extended this deadline in September 2019 with SB 778 to January 1, 2021. Training must then be completed every two years thereafter. New hires and Supervisors must be trained within 6 months of hire, or promotion to supervisor.
Stay up to date with recent changes to California labor law posters! In order for your business to stay in compliance with these recent changes, the updated posting(s) must be downloaded, printed, and then posted next to your current labor law poster. Remember, labor law posters must be posted in a conspicuous location so that all employees may see them.
1. EDD- Unemployment Insurance, Disability Insurance, Paid Family Leave:
The California Employment Development Department (EDD) has updated its EDD notice regarding Unemployment Insurance, Disability Insurance, and Paid Family Leave. The updated notice reflects a change to the online application platform, as well as formatting changes. The department recommends maintaining updated information, however, this update will not be mandatory until January 1, 2019. The poster revision date is August 8, 2018.
On Wednesday, February 7, 2018, Jennifer Grady, Esq. will host the 2018 Labor Law Update, sponsored by The Grady Firm, P.C. and the California Employers Association (CEA) in Beverly Hills, California. This event will cover recent, drastic changes to employment law and how such changes may impact California employers. There will be time for Questions and Answers at the end of the presentation, and the opportunity to network with other business owners.
Late last year, Governor Jerry Brown signed more than 800 new bills into law. Many new laws significantly impact employers, including: Continue reading
USCIS released a revised version of Form I-9, Employment Eligibility Verification, on July 17, 2017. Download instructions are available on the Form I-9 page. Employers can use this revised version, or continue using Form I-9 with a revision date of 11/14/16 N through Sept. 17, 2017. However, on Sept. 18, employers must begin using the revised form with a revision date of 07/17/17 N. Employers must continue following existing storage and retention rules for any previously completed Form I-9.
Revisions to the Form I-9 instructions:
- USCIS changed the name of the Office of Special Counsel for Immigration-Related Unfair Employment Practices to its new name, “Immigrant and Employee Rights Section.”
- USCIS removed “the end of” from the phrase “the first day of employment.”
Last month, we discussed how the Department of Labor (DOL) was scheduled to implement a new rule that would increase the minimum salary requirements for exempt employees. The new rule published by the DOL would have doubled the minimum salary requirements for employees from $455/week to $913/week. This rule was supposed to take effect on December 1, 2016; however, employers can breathe easy for a bit longer.
On November 22, 2016 a federal judge from the United States District Court in Texas temporarily blocked implementation of the rule, in response to a request by 21 states and business groups. This delay is temporary, while litigation continues and the court makes a determination as to whether the DOL has the authority to implement such a rule. Continue reading
ATTENTION all Employers:
The Department of Labor recently revised the federal mandatory minimum wage and polygraph posters that employers must post in the workplace.
Although the federal minimum wage did not change, the new minimum wage poster now contains information regarding the consequences of incorrectly classifying workers as independent contractors, in addition to a new section on the rights of nursing mothers.
The new federal polygraph poster now contains updated contact information for the Department of Labor, and no longer contains a reference to the penalty amount of up to $10,000 for violation of the law.
Employers are required to post the updated posters in a conspicuous area of the workplace by no later than August 1, 2016. Continue reading
California employers are required to follow the following state and federal laws regarding paydays, final paychecks, overtime, and wage statements. As failure to do so can result in significant penalties, interest, and attorney’s fees, employers must ensure that they are in compliance with the applicable laws below.
Employees must be paid wages at least twice per calendar month on specific days, as established by company policy. Pursuant to California Labor Code § 207, the regular pay day schedule must be posted in a conspicuous/obvious place on a notice showing the time, day, and location of payment.
Wages earned between the 1st and 15th days of the month must be paid by the 26th day of the month during which the labor was performed. Wages earned between the 16th and the last day of the month must be paid by the 10th day of the following month. Labor Code § 204(a). Continue reading
SACRAMENTO – On September 25, 2015, the State of California’s Employment Training Panel approved more than $11 million to train more than 12,880 workers throughout California. In total, the panel approved 42 training contracts aimed at supporting job creation and retention while increasing opportunities for workers through the development of job skills and training. The Employment Training Panel (ETP) provides funding to employers to assist in upgrading the skills of their workers through training that leads to good paying, long-term jobs.
The ETP was created in 1982 by the California State Legislature and is funded by California employers through a special payroll tax. There are millions of dollars in this account accessible to employers each year. The ETP is a funding agency, not a training agency; therefore employers can determine their own training needs and who provides their training.
“These training contracts are significant economic development tools for businesses and their employees,” said Stewart Knox, the Employment Training Panel’s Executive Director. “Workers receive job training for well-paying jobs, and businesses can grow their workforce and revenue.”