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 took effect on January 1, 2020. FIND OUT how to comply with this law by downloading our easy-to-understand instructions.Continue reading
As companies grow and evolve over time, it soon becomes clear that they will outgrow their employee and operations policies–that is, if they even had any in the first place! The best time for a CEO, COO, CFO, and Human Resources Department is to reassess these policies is at the end of the year, and to roll out new policies at the start of a new year. Every January, there are changes that will take place anyway (such as updated IRS mileage reimbursement rates and local minimum wage rates), so it’s a good time to include policy updates when you provide this information to employees all at once. There are numerous policies you can begin revising now to issue to your staff in January. Read further to begin your end of year action plan:
1. Employee Handbook
The first item that should be addressed is the company Employee Handbook. If your company does not have one, or has not updated an existing one in more than a year, it’s time to speak with an attorney about creating or updating your Handbook. In fact, for companies that have more than 5 employees, a Handbook is a no-brainer because it will have clauses in it that you are required to provide to employees (for example, Pregnancy Disability Leave is available for employees at companies with 5 or more employees, and the Employee Handbook is the best place to provide this information to employees). Besides using the Handbook as the opportunity to explain all of the California mandatory leave-laws, paid sick leave time, and cell phone reimbursement policy, you can use this as a forum to explain the company’s social media, use of technology, dress code, tardiness, absentee, and drug/alcohol use policies. You can also outline which behaviors will result in discipline or termination. Continue reading
On April 4, 2016, Governor Jerry Brown signed the “Fair Wage Act of 2016,” a bill that aims to increase California’s minimum wage to $15.00 per hour by the year 2022. Under California law, employers must also offer employees at least 3 days, or 24 hours, of sick leave per year. This statewide law applies to all cities and counties within the state of California. However, some cities within California have chosen to add to the statewide laws with their own more expansive minimum wage and paid sick leave ordinances. As it can be difficult for employers to keep track of all these constant changes, we have taken the time to highlight some of those changes in several major California cities.
CALIFORNIA STATE LAW- ALL COUNTIES
As of January 1, 2016 the required minimum wage for the state of California is $10.00 per hour. On January 1, 2017, the minimum wage for business with 26 employees or more will increase to $10.50 an hour. On January 1, 2018 it will increase to $11.00 an hour and by $1 each subsequent year until it reaches $15.00 in 2022. Employers with 25 employees or less will have an extra year to comply with the new law, and the wage increase will not go into effect until January 1, 2018.
In addition, any employee who works in California for 30 or more days is entitled to receive paid sick leave. An employer is required to provide a minimum of 3 days of sick leave per year, and after 90 days of employment an employee may begin to accrue sick leave at a rate of 1 hour for every 30 hours worked. Accrued sick leave may be carried over to the next year, however an employer may choose to cap the amount of paid six leave an employee may use per year to 6 days or 48 hours.
Notice to Employees
Employers must provide notice of these laws to employees by: (1) Displaying the state’s official poster; (2) Including paid sick leave information in the wage notices of nonexempt employees; and (3) Including the amount of paid sick leave available in the employees’ wage statements. Employers must also keep records documenting hours worked and paid sick leave accrued for the last 3 years.
These minimum statewide laws apply to all cities and counties in California, and includes the regions below.
On April 19, 2016, the Los Angeles City Council approved a measure that would require employers in the City of Los Angeles to provide their employees with six days, or 48 hours, of paid sick leave. Pending an approved ordinance drafted by the City Attorney, the requirement will become effective on July 1, 2016. This would be three days more per year than the State of California’s paid sick leave requirements which took effect on July 1, 2015.
The ordinance would apply to employees who who work for the same employer in the City of Los Angeles for thirty days or more per year , and would begin on the first day of employment, or July 1, 2016, whichever is later. Employers who contract with the city of Los Angeles will still be required to give their employees twelve days, or 96 hours, of paid sick leave. Workers in Los Angeles would not be paid for unused sick days, but accrued time could be carried over to the next year. Businesses could cap that accrued time at 72 hours, or set a higher cap or none at all.
The new Paid Sick Leave law that went into effect in California on July 1, 2015 was already amended less than two weeks after it took effect on July 1, 2105. This means that employers may have to revisit, and most likely update their paid leave policies and Employee Handbooks.
An employer must individually notify all employees hired prior to January 1, 2015 of changes to terms and conditions of employment that relate to paid sick leave within 7 days of the actual change. Information concerning any new or previously existing paid sick leave program that includes information required to be given to each employee by Labor Code section 2810.5(a), must be provided to all employees. A revised DLSE notice form may be used for providing individual notice to these existing employees unless the employer chooses an authorized alternative method. Continue reading
On July 1, 2015, a new law affecting millions of Californians went into effect requiring that employers – both public and private – provide paid sick leave to all their employees. Under the new law, employers will have to modify or update existing paid sick leave or time off policies, as well as payroll, recordkeeping, and employee notice procedures.
The “Healthy, Workplace, Healthy Families Act” (AB-1522) signed into effect by Governor Edmund G. Brown Jr. applies to all employees who work in California for thirty (30) or more days in a year. The law defines “employer” as any person employing another under any appointment or contract of hire” regardless of how many (or few) employees they have, and covers employees whether they are full-time, part-time, seasonal, or temporary. Specifically, the new provision provides that employees who work thirty (30) or more days within a year from commencement of their employment will earn a minimum of one hour of paid sick leave for every thirty (30) hours worked.
Employees become entitled to their sick leave beginning on the ninetieth (90th) date of employment. However, an employer may limit an employee’s use of paid sick days to 24 hours—or three (3) days—in each year of employment, which results in no carryover requirements. Click HERE for the full text of the new law. Continue reading
The California Legislature was quite active in 2014, resulting in several substantial changes to the law for 2015 that are employee-friendly. Employers should take note of the changes to the law described below.
I. CHANGES TO WAGE AND LABOR LAWS
1. Minimum Wage Increases
The minimum wage increased statewide, with even higher increases in particular cities:
- California’s minimum wage of $9.00 will increase again to $10.00 on January 1, 2016;
- San Francisco wages will increase to $11.05 on January 1, 2015; then to $12.25 in May; wages will increase every year thereafter until the minimum wage reaches $15.00 in 2018;
- Oakland will increase to $12.25 on March 2, 2015;
- San Diego will increase to $9.75 on January 1, 2015;
- Note: exempt employees must meet new minimum wage laws