2019: A Year to Forget for California Employers

From the California Supreme Court’s landmark decision in Dynamex to the passage of dozens of new employment laws, 2019 was an important year for California employers.  While some of these new laws were discussed here, this blog discusses some additional laws (there are a lot) and provides some updates on legal challenges to AB 5 and AB 51.

• Pursuant to previously enacted laws, on January 1, 2020 California’s annual minimum wage increased to $13 per hour ($12 per hour for employees with 25 or fewer employees).
• SB 778 clarifies California employers’ duties to provide harassment training to employees. Pursuant to previously enacted SB 1343, employers had a duty to provide harassment training to both supervisory and nonsupervisory employees once every two years.  SB 778 extends the initial deadline for providing new training to employees from January 1, 2020 to January 1, 2021.  It also clarifies that employees who completed harassment training in 2019 do not need to retrained for another two years and then every two years thereafter.
• AB 5 codifies the California Supreme Court’s decision in Dynamex Operations West, Inc. v. Lee, which announced a new, more objective standard for determining worker classification for the purposes of the California wage orders. Due to AB 5’s clear impact, certain entities involved in the “gig economy” have taken steps to avoid its effects.  On October 29, 2019, Uber, Lyft, and DoorDash filed a ballot measure with the California Attorney General that would exempt them and other “app-based companies” from AB 5 and Dynamex.  In addition, on December 30, 2019, Uber and Postmates filed suit challenging AB 5 on constitutional grounds.  The results of these steps remain to be seen, but we will report back as soon as we know more.
• With the enactment of AB 9, the statute of limitations to bring an administrative charge to the California Department of Fair Employment and Housing (which is a condition of filing a lawsuit) has been extended from one to three years.
• In SB 188, the legislature expanded the definition of “race” under California’s Fair Employment and Housing Act to include “traits historically associated with race, including, but not limited to, hair texture and protective hairstyles.” This may require employers to modify certain grooming standards contained in their handbooks or in other written (and unwritten) policies.
• AB 51 prohibits employers from requiring employees to execute arbitration agreements as a condition of employment. But wait!  While this law was set to go into effect on January 1, 2020, on December 30, 2019, the Honorable Kimberly J. Mueller, Chief Judge in the Eastern District of California, granted a temporary restraining order in a case brought by certain business groups enjoining the enforcement of AB 51.  While it remains to be seen whether Judge Mueller will ultimately determine AB 51 to be preempted by federal law, this is a very important step in that direction and we will keep our eyes on this case.
• SB 142 extends employers’ obligations to accommodate employees who are nursing. Specifically, under this law employers must provide employees with the use of a room or other location (other than a bathroom) in close proximity to the employee’s work area for the employee to express milk in private.  Such space must meet the requirements of the California Labor Code, including a surface to place a breast pump and personal items, a place to sit, access to electricity, a sink with running water, and a refrigerator for storing breast milk.  In addition, employers must develop and implement policies regarding lactation accommodations.  This law will likely require employers to update their employee handbooks.
• AB 749 prohibits employers from including clauses in settlement agreements providing that the employees will not be rehired. This law includes an exception if the employer has made a good-faith determination that the employee engaged in sexual harassment or sexual assault.  The efficacy and enforceability of this law, however, remains to be seen as the law does not require employers to continue to employ or rehire the person if there is a legitimate, lawful reason for their termination or refusal to rehire.
• Under existing law, employers can seek and obtain workplace restraining orders on behalf of their employees. Existing law also authorizes immediate family members of a person or a law enforcement officer to obtain a gun violence restraining order temporarily preventing that person from having a firearm or ammunition.  AB 61 permits employers, coworkers, and teachers to seek and obtain such restraining orders.  AB 61 goes into effect on September 1, 2020.
• AB 1223 extends an employee’s entitlement to leave for the purposes of organ donation. Under the prior law, employers were obligated to provide up to 30 days of paid leave to an employee who donates organs.  As of January 1, 2020, employers are also required to provide up to an additional 30 days of unpaid leave to such employees.

California employers should be aware of these laws as they continue to do their best to navigate the ever-dangerous waters of California’s employment laws.  As always, we will provide updates throughout the year on important developments in these and other aspects of California’s employment laws.