If you have the right answers, you should survive 2019.
No. 1: Are you ready for #MeToo, California-style? Take a look at your settlement agreements in cases involving sexual harassment to ensure that they don’t violate the new tax codes and confidentiality rules. Make sure you are up to date on your anti-harassment and anti-bullying training. New training requirements, which will apply to employers with five or more employees, and which must include non-supervisory employees, will take effect in January 2020. But if you do the training in 2019, you won’t have to do it again in January 2020.
No. 2: Are you still using “salary history” to set pay? We hope not. Make sure that your pre-employment inquiries and methods for setting pay for new hires do not run afoul of the equal pay laws prohibiting use of salary history.
No. 3: Are your independent contractors independent contractors, or are they “independent contractors”? The new Dynamex decision changes the game for companies who use what they think are independent contractors. The California Supreme Court retroactively adopted the “ABC test,” which means it will be that much harder for a company to claim that a worker in California is a true “independent contractor” rather than an employee.
No. 4: Are you still rounding time? With the decision in Troester v. Starbucks, California law, unlike federal law, no longer allows de minimis time (relatively trivial amounts of time) to be unpaid. Rounding systems are still technically lawful, but they create such severe practical problems that employers should consider eliminating rounding, if possible. In addition, systems that don’t allow an employee to clock in until after performing some activity — for example, booting a computer or gathering materials — are plainly problematic in California.
No. 5: Are your arbitration agreements ready for a possible “post-PAGA” world? Lawsuits brought under the California Private Attorneys General Act took off this year, and continue to be a focus now that most employers have in place arbitration agreements with class action waivers. A new lawsuit has recently been filed that is designed to get the U.S. Supreme Court to review the PAGA and the ability of employers to force PAGA claims into individual arbitration. Now is a good time to review your arbitration agreement in place so that you can address this possibility in the future.
No. 6: Are your pay stubs compliant? Inaccurate or incomplete pay stubs continue to be a source of “gotcha” litigation in California. You should review your company’s pay stubs every calendar quarter, and closely supervise any software changes made by your payroll group or provider.
No. 7: Are your rest breaks uninterrupted? The anti-employer decision in Augustus v. ABM has been used by plaintiffs to suggest that virtually any rest period system is faulty because, as a practical matter, an employee might be interrupted. If a rest break is interrupted, then legally the break was not provided. It is worth reviewing your rest break policy and practices to make sure that you can prove employees’ rest breaks are “uninterrupted.”