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Is your business ready for these new California laws that take effect in 2021?

California companies small and large may find that new laws hitting the books Jan. 1 could smack their bottom lines and workforces by granting more time to employees and requiring more procedures from them.

Many of these new business-oriented bills that came out of the California Assembly and Senate and signed by Gov. Gavin Newsom this year deliver more clout and bargaining power to employees. Examples include laws that deliver more time and resources to employees with fewer questions asked by the companies they work for.

Many represent a new version with addendums and a strengthening to existing laws. Some dictate new rules on the easing of restrictions for employee leave and complaints. Others are related to the COVID-19 crisis, with a few making it harder for organizations to do business during its consequential economic upheaval, labor law and business advocates contend.

Minimum wage hike

Out of the starting gate, most employees in California must be paid the minimum wage of $14 an hour, according to the state Department of Industrial Relations. The law signed by Gov. Jerry Brown in 2015 has launched a wage progression each year starting Jan. 1, 2017, by adding 50 cents to the $10-per-hour standard. From the beginning of 2019, the wage has gone up by a dollar and now stands at $13 for every 60 minutes worked.

Senate Bill 1383

SB 1383 was written by Sen. Hannah Beth Jackson, D-Santa Barbara, with the intent to expand family leave of up to 12 weeks to include small companies with five employees or more. Up to three months of family leave used to only apply to companies with 50 or more employees.

Lisa Ann Hilario is an employment law specialist with Spaulding, McCullough & Tansil in Santa Rosa. (courtesy photo)
Lisa Ann Hilario is an employment law specialist with Spaulding, McCullough & Tansil in Santa Rosa. (courtesy photo)

The law also extends granting time off for workers to care for siblings and grandparents as well as one’s children, parents, spouses or domestic partners. It applies to full- and part-time employees with their companies for at least one year, who have worked more than 24 hours each week.

Representing a bane for business and blessing to workers, the law was brought forth in the pre-COVID-19 days on Feb. 21.

“At a time when it’s tough for employers, it’s a shame this wasn’t put off for a year. This is going to be a shock to some employers,” said Lisa Ann Hilario, an employment law specialist with Spaulding, McCullough & Tansil in Santa Rosa. “This is just another example of something that’s well-meaning but may be a significant impact on employers. These are hard times.”

Susan Daniel is a law professor at Empire College in Santa Rosa. (courtesy photo)
Susan Daniel is a law professor at Empire College in Santa Rosa. (courtesy photo)

Empire College law professor Susan Daniel agreed.

“This is going to be impactful on them. Many of these companies don’t have enough people to allow employees to be out 12 weeks,” Daniel told the Business Journal. “I think this law is going to have a profound effect, even with it being unpaid.”

The California Chamber of Commerce policy advocate, Ashley Hoffman concurred.

Ashley Hoffman is the policy wonk with the California Chamber of Commerce. (courtesy photo)
Ashley Hoffman is the policy wonk with the California Chamber of Commerce. (courtesy photo)

“This law has been the biggest priority for us in terms of opposition, not just because of the qualifying reasons, but for the size of the companies (affected),” Hoffman said.

Still, the state lawmaker insists the expansion of the California Family Rights Act plays a crucial role in helping six million workers throughout the state care for family members and spouses while protecting their jobs.

“Access to family leave is especially critical amid COVID-19 when workers need to take time off to care for themselves or their loved ones. Yet without job protection, many workers fear losing their job for taking the paid family leave benefits they pay for,” Jackson said in a statement. “Job-protected family leave promotes public health, boosts economic recovery and supports working families.”

Assembly Bill 685

The impact of COVID-19 is expected to linger well into 2021, running parallel with a new law authored by Eloise Gomez Reyes, D-San Bernardino, that requires companies to tell employees within 24 hours when a worker tests positive.

It also allows the California Department of Public Health to shut down a business if the agency determines an outbreak exists.

Failure to provide adequate notifications may result in a $10,000 fine. But beyond that black-and-white result, AB 685 brings a gray area to the reporting guidelines.

Faced with cases in their workplaces, some companies have issued “gag” orders not allowing their employees to talk about positive coronavirus cases, citing federal health privacy regulations.

And therein lies a concern. What if notification is based on hearsay from another employee or involves information that fails to make a definitive case?

An example may involve a worker who shows up at a function in his or her leisure time over the holidays where someone tests positive. Does that mean the worker will test positive?

The law also requires companies establish disinfecting guidelines to sterilize their workplaces.

Hilario has called the law — outlined in eight pages of single-spaced notes — “complicated and incredibly challenging.”

To that, the Santa Rosa legal academic agreed, explaining the law is “written in an ambiguous fashion,” Daniel said.

From the business perspective, Hoffman cited how any positive case will “trigger certain requirements” and “dovetail into” yet another change in regulations surrounding workers compensation as highlighted in Senate Bill 1159.

This law written by Sen. Jerry Hill, D-San Mateo, would create the presumption that an “injury” an employee experiences that includes illness or death resulting from the coronavirus arose or originated at work.

Assembly Bill 2992

Also on the agenda in 2021 is AB 2992, which Assemblywoman Shirley Weber, D-Chula Vista, wrote as a means to allow workers who are crime victims to take time off to handle judicial proceedings without repercussions.

Hilario noted this law may become a teaching moment for managers to pass down to their supervisors, who may balk at granting time off of up to 12 weeks for such a reason.

Whereas Daniel noted being sympathetic to an employee who has sustained a traumatic event may appear to be “a given,” some smaller companies with five or so workers may consider this a hardship.

“This could add up to 20% of the workforce taken out,” Daniel said. “But this (law) may not be as impactful. Normally, (these circumstances) don’t need 12 weeks (to resolve).”

Senate Bill 973

With SB 973, which notably goes into effect March 31, the state will step in where the federal government leaves off.

Senator Jackson introduced this bill to authorize the state Department of Fair Employment and Housing to “receive, investigate, conciliate, mediate and prosecute complaints alleging practices unlawful under those discriminatory wage rate provisions.”

Companies with 100-plus employees will be required to file an “employer information report” under federal law that provides pay data. The law mandates the data to determine whether minorities have been discriminated against in pay.

“When (U.S. President Donald) Trump put a hold on this, California said we’re going to collect this because we want to enforce the equal pay law,” Hilario explained.

Daniel said she expects this law to be less impactful than others.

Other notable laws starting Jan. 1

  • AB 2017 allows an employee to choose whether taking time off to care for a family member will be considered “sick leave.”
  • SB 1384 grants the labor commissioner to provide legal representation to workers who can’t afford to pay for legal expertise and file a complaint that goes into arbitration.
  • AB 1947 extends the period of time that employees may file complaints from six months to one year.

Legal ‘reverberations’ coming

To navigate through the new laws, the state chamber will put out employee law presentations on Jan. 7, 15 and 21. Hoffman said the chamber staged a human resources symposium last week to prepare companies for the upcoming year.

With the flurry of laws coming about in 2021, the notion of workers experiencing more rights and companies having to jump through more hoops exemplifies a common tendency from the California Legislature every year, Hilario and Daniel noted.

“There’s nothing wrong with (employees’ receiving more rights). I just think (senators and assembly members) don’t take into account small employers and their issues,” Daniel said. “Large companies lobby (the Legislature), but small employers don’t lobby, and this is going to have ramifications for them.”

Susan Wood covers law, cannabis, production, energy and agriculture as well as banking and finance. For 25 years, Susan has worked for a variety of publications including the North County Times in San Diego County, Tahoe Daily Tribune and Lake Tahoe News. She graduated from Fullerton College. Reach her at 530-545-8662 or susan.wood@busjrnl.com.

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