A number of changes to California Employment Law have taken effect or were recently amended. The laws are summarized below. If you are experiencing difficulties at work regarding these situations, or would like to speak with an attorney regarding your employment rights, please give us a call.
Changes to the new law regarding Paid Sick Leave include requirements that:
-An employee must work for the same employer for 30 or more days within a year of the commencement of employment to be eligible to use PSL.
-Allow for alternative accrual methods for all leave banks.
-“Grandfather” in leave banks existing as of January 1, 2015.
-Allow employers with unlimited or undefined leave banks to indicate “unlimited” on the employee’s itemized wage statement.
-Allow employers to calculate the rate of pay for employees using any of three methods.
-Make other clarifications and exclusions from the PSL law, and delay its effective date for some employers.
California’s equal pay statute, first enacted in 1949, was significantly modified to lower the burden of proof for plaintiff’s claims, to greatly increase the burden of proof for an employer’s defenses, and to allow employees to ask other employees about the amount of their wages for the purpose of ascertaining whether there may be a factual basis for an equal pay claim. Governor Brown has referred to the new law as “the strongest equal pay law in the nation.”
Employment retaliation protections are extended to an employee who is a family member of a person who engaged in, or is perceived to have engaged in, legally protected conduct. This bill also exempts household goods carriers from the client employer and labor contractor liability provisions in this law.
Employers are prohibited from retaliating or otherwise discriminating against an employee for requesting accommodation of his or her disability or religious beliefs, regardless of whether the accommodation request was ultimately granted. The new law is intended to clarify a portion of the holding in the published decision of Rope v. Auto-Clor System of Washington, Inc. 220 Cal. App. 4th 635 (2013).
The Labor Commissioner is authorized to file a lien on real estate, or a levy on an employer’s property, or impose a stop order on an employer’s business in order to assist an employee in collecting unpaid wages where there is a judgment against the employer. Any employer, or individual acting on behalf of an employer, who violates any provision regulating minimum wages or hours and days of work in any order of the Industrial Welfare Commission, or who violates other related provisions of law may be held liable as the employer for such violation. A bond of up to $150,000 may be required of an employer who does not promptly pay a judgment for unpaid wages.
The Labor Commissioner will have the authority to issue a citation to enforce local minimum wage and overtime laws, including against an employer or person acting on behalf of an employer for violations of existing law related to reimbursements for expenses.
The duration of the “disability benefit period” is extended from 14 days to 60 days.
Two statutory provisions containing the term “alien,” used to describe any person who is not born in or a fully naturalized citizen of the United States, will be deleted from the Labor Code.
The Family School Partnership Act is expanded to broaden the authorized reasons for which an employee can take job-protected time off of work without the fear of discrimination or discharge by allowing workers to take time off work to: (1) find, enroll, or re-enroll his or her child in a school or with a licensed child care provider, and (2) to address a child care provider or school emergency, as defined. (SB 579; amends Labor Code sections 230.8 and 233).
Certain grocery stores that are sold to another entity will have specified obligations to retain grocery workers for a limited period of time.
The definition of an “unlawful employment practice” is expanded to prohibit an employer or any other person or entity from using the E-Verify system at a time or in a manner not required by federal law, or not authorized by a federal agency memorandum of understanding, to check the employment authorization status of an existing employee or an applicant who has not received an offer of employment. There is a civil penalty of up to $10,000 for each violation of the provisions of the bill.
Pedicab businesses might have the option of allowing alcohol to be served and consumed on board, if their employees are properly trained.
If you are an “App User,” the U.S. Department of labor launched its first smartphone application – the DOL-Timesheet that may be useful to you in tracking your hours worked. This timesheet application, which is available in English and Spanish versions, provides a record keeping system that enables you to keep track of your work hours and determine the wages your employer owes you.
Users can track regular work hours, break time, and overtime hours. Users can also add notes or comments (project name, work site, etc) and view summaries of their work time (and wages owed) in daily, weekly, and monthly formats. Even better? You can email the summary as an attachment to ensure your record – and your paycheck – is accurate.
This application is a huge boon to employees who no longer have to rely on their employer’s records. In the event of a wage and hour dispute, the employee’s records could assist in winning a wage claim, particularly where the employer has failed to maintain accurate records as required by law.
If you do not have a smartphone, you can download a timesheet calendar that will help you maintain the same information. Both can be downloaded from the DOL’s Wage and Hour Division homepage.
A recent California Appellate decision expanded the definition of “commissions” and found that no overtime was owed to a car salesperson, despite the long hours she worked. In Areso v. CarMax, Inc., the Court held that CarMax’s commission plan qualified as “commission wages” under Labor Code section 204.1, for purposes of the exemption, because it pays a uniform or standard amount to each salesperson for each vehicle sold, regardless of price.
Are you a commissioned salesperson? Are you owed overtime? The Areso case may be of interest to you. If you have any questions regarding this case, or a possible claim, give us a call. A summary of the case follows:
Areso was a car salesperson for CarMax, Inc. She filed a putative class action lawsuit, alleging misclassification and failure to pay overtime wages. Under the law, an employer’s commission plan must be “based proportionately on the amount or value” of the sale of the employer’s property or services. CarMax won on a motion for summary judgment because the Court found that its compensation arrangement is a “performance-based incentive system and thus fairly understood to be a
commission structure” based on the statutory language that commissions may be based on the “amount” rather than “value” of vehicles sold, where the “amount” is
interpreted to mean the number of vehicles sold.
To qualify for the commissioned salesperson exemption, the employee: (1) must be involved principally in selling a product or service (not making a product or rendering a service); and (2) the amount of their compensation must be based proportionately on the amount or value of the product or service. However, the Areso Court distinguished this case from other cases where the employer’s commission plan was held not to constitute commission wages because those cases interpreted whether the commissions were based on the “value” of the product or service.
The Court also noted no other court has construed the word “amount” in the statute, and that CarMax’s payment of a standard amount of earnings for each vehicle sold satisfies the statutory requirement. The Court found that a standard – or uniform, fee for each vehicle satisfies the law and is “proportionate” because it is a one-to-one proportion based on the number of vehicles sold.
While this case appears good for employers who pay salespersons by commissions, there are strict requirements before the compensation plan will pass muster and qualify under the law. The case is also a relatively new interpretation of law and it remains to be seen if other courts will follow. You can find a full copy of the case at http://case.lawmemo.com/ca/areso.pdf
If you are an employee paid under a commission plan who wonders if that plan is legal, or if you are an employer seeking to establish a compensation plan in compliance with the law, feel free to give us a call.