California Employment Law Update

by Sonya Goodwin

We are now six months into the pandemic and various social distancing orders, and in that time, the California legislature has passed quite a few employment laws, some of which are COVID-related.  Below is a summary of these new laws and amendments to current laws. 

COVID-19 Reporting Requirements for Employers

Under AB 685, employers are required to notify employees, representatives of the employees, and employers of subcontracted employees, in writing, within one business day of receiving notice of a potential workplace exposure to COVID-19.  Employers are not required to inform all employees of potential exposure; rather, they need only inform the above-mentioned individuals who were on the premises at the same worksite as the potentially infected individual within the infectious period.  “Worksite” is defined as the “building, store, facility, agricultural field, or other location where a worker worked during the infectious period.”  “Infectious period” means “the time a COVID-19 positive individual is infectious, as defined by the California Department of Public Health.”  Employers must also inform these individuals of COVID-19 related benefits to which they may be entitled, including, workers’ compensation, various forms of sick leave available, and anti-retaliation and anti-discrimination protections. Employers must also notify these individuals about disinfection and safety plans that the employer plans to implement per CDC guidelines. 

Additionally, employers must notify public health officials within 48 hours if the numbers of cases are considered an “outbreak,” which is defined as three or more laboratory-confirmed cases of COVID-19 within a two-week period among employees who live in different households. 

Employers may not disclose employee medical information unless otherwise required by law.  Employers must maintain records of the written notices it provides to employees, employee representatives, and employers of subcontracted employees for at least three years.

This law goes into effect on January 1, 2021.

Workers’ Compensation for COVID-19 Injuries

SB 1159 codifies the governor’s executive order that created a rebuttable presumption that an employee who is infected with COVID-19 within 14 days of working outside the home became infected at the workplace, and as such, the medical and other related costs are compensable under workers’ compensation. 

While the executive order expired on July 5, 2020, the newly enacted SB 1159 retroactively codified it, but also created more limited workers’ compensation protections to certain workers through January 1, 2023.  For example, under SB 1159, if, after July 5, 2020, specific front line workers, such as firefighters, peace officers, and employees who provide direct patient care, test positive within 14 days after the employee performed services at the employee’s place of employment, there is a disputable presumption that the illness arose out of and in the course of the employment and is covered by workers’ compensation for full hospital, surgical, medical treatment, disability indemnity, and death benefits.

Additionally, if employees not mentioned above test positive during an outbreak at the employee’s place of employment, and whose employer has five or more employees, there is a disputable presumption that this injury arose out of and in the course of employment and is covered by workers’ compensation, and the same benefits as mentioned above are compensable.  An “outbreak” exists if (1) the employer has 100 or fewer employees at a specific place of employment (i.e. a building, store, facility, or agricultural field where an employee performs work), and 4 employees test positive for COVID-19, or (2) the employer has more than 100 employees at a specific place of employment and 4 percent of the number of employees who reported to the specific place of employment test positive for COVID-19 during a continuous 14-day period.   This section of the bill is retroactive to July 6, 2020.

SB 1159 also provides reporting requirements to the employer’s workers compensation claims administrator when the employer knows or reasonably should know that an employee has tested positive for COVID-19.

SB 1159 is effective immediately and remains in effect until January 1, 2023.

Expanded Family Leave for Smaller Employers

SB 1383 expands the California Family Rights Act (CFRA) to require employers of five or more employees to provide up to 12 workweeks of unpaid protected leave to an employee (1) to bond with a new child, (2) to care for their own serious health condition, or to care for a child, parent, grandparent, grandchild, spouse, or domestic partner who has a serious health condition, or (3) because of a qualifying exigency related to the covered active duty or call to covered active duty or an employee’s spouse, domestic partner, child, or parent in the Armed Forces of the United States.  Similar to the CFRA and New Parent Leave Act (NPLA) requirements, the employee must be employed with the employer for at least 12 months and have at least 1,250 hours of service in order to qualify for the leave. 

While the leave is unpaid, an employee may elect, or the employer may require, an employee to substitute any of the employee’s accrued vacation leave or other accrued time off.  If the leave is for the employee’s own serious health condition, the employee may elect, or the employer may require the employee to substitute accrued paid sick leave during the period of leave.  If the parties mutually agree, the employee may use accrued paid sick leave to bond with a child or care for a family member, as described above. 

Under existing law, if both parents of a child are employed by the same employer, both employees receive a total of 12 weeks of unpaid protected leave during a 12-month period.  Under the new law, both employees are entitled to 12 weeks of leave during a 12-month period.

This law goes into effect on January 1, 2021.

Amendment to Independent Contractor Law

AB 5, which went into effect on January 1, 2020, created a presumption that a worker was an employee, and codified the ABC test to determine whether a worker was an independent contractor.  AB 5 included some exemptions to the ABC test, and for the most part required application of the common law test – commonly referred to as the Borello test – to those exempt categories.   

Governor Newsom recently signed AB 2257, which provides additional exemptions under AB 5.  The additional categories of workers who are exempt from the ABC test (subject to certain requirements for some categories), and instead apply the Borello test, include music industry professionals; performance artists; specialized performers hired to teach a class for no more than one week; appraisers; registered professional foresters; licensed landscape architects; home inspectors; manufactured housing salespersons; competition judges; and certain individuals engaged by international exchange visitor programs, among others.  AB 2257 also eliminated some of the restrictions that AB 5 set on the journalism industry, and expanded the business to business exemption and referral agency exemption. 

The bill is effective immediately. 

Expanded Supplemental Paid Leave for COVID-19

AB 1867 requires employers who employ 500 or more employees in the U.S. or health care workers who were exempt from the Federal Family First Coronavirus Response Act (FFCRA) to provide supplemental paid leave for COVID-19 related illnesses.  The paid sick leave applies to any employee who leaves his or her home in order to perform work for the employer and is unable to work due to the following:

  • The covered worker is subject to a federal, state, or local quarantine or isolation order related to COVID-19.
  • The covered worker is advised by a health care provider to self-quarantine or self-isolate due to concerns related to COVID-19.
  • The covered worker is prohibited from working by the covered worker’s hiring entity due to health concerns related to the potential transmission of COVID-19.

Each employee is entitled to the following:

  • 80 hours of paid sick leave if they are full-time and worked at least 40 hours in the two weeks preceding taking the paid sick leave. 
  • If they work a normal schedule of less than 40 hours, then the total number of hours the employee is normally scheduled to work during a two-week period.
  • If the employee works a variable schedule, then 14 times the average number of hours the employee worked during the 6 months (or less if the worker has been employed for less than 6 months) preceding the date of taking the paid sick leave.

The employee may determine how many hours of paid sick leave he/she wants to use up to the maximum available, but must request the leave verbally or in writing. 

The rate of pay for the sick leave is the greater of (1) the employee’s regular rate of pay for the last pay period, (2) the state minimum wage, or (3) local minimum wage, but no more than $511/day and $5,110 total.

If the employer already provides paid sick leave to employees for the reasons set forth above (other than the regular California paid sick leave), the employer does not have to provide additional paid sick leave.  For example, Los Angeles employees would not receive an additional 80 hours of paid sick leave if they already received supplemental paid sick leave under the LA ordinance, or if an employer provided the same paid sick leave benefits on its own accord.  Additionally, if an employee has already taken unpaid time off for the reasons set forth above between March 4, 2020 and the present, the employer can retroactively provide pay for that time instead of giving additional paid time off.   

Covered employers must provide notice to employees via this poster:  https://www.dir.ca.gov/dlse/COVID-19-Non-Food-Sector-Employees-poster.pdf

Covered employers are also required to inform each employee of how much available paid sick leave he/she has on each wage statement (similar to the requirement for California’s regular paid sick leave law), to go into effect on the next pay period.

This law goes into effect immediately, and expires on the latter of December 31, 2020 or until the expiration of any federal extension of the FFCRA.

The penalty for non-compliance is the greater of $250/day or three times the amount of paid sick days withheld, up to a maximum of $4,000 per employee.

Harassment Training Deadline is Approaching

Just a reminder that the deadline to provide anti-harassment training to all employees (two hours to supervisory employees, one hour to non-supervisory employees) is January 1, 2021.  All employers with five or more employees are required to provide this training.

If you need assistance finding the right training course for your employees, or would like us to provide virtual training to your employees, please contact our office.

New Minimum Wage

The state minimum wage for employers with 25 or fewer employees is increasing to $13/hour, and $14/hour for employers with 26 or more employees, effective January 2, 2021.  Please make sure to check local minimum wage laws that may be higher than the state minimum wage requirements in all jurisdictions in which you conduct business.

If you have any questions on any of the above, or would like us to review or update your employee handbook, please do not hesitate to contact Sonya Goodwin.

Return to Work Plans During the COVID-19 Pandemic

by Sonya Goodwin

As the economy has started to open back up, employers of all kinds should have a return to work plan in place to prepare for the inevitable return of employees to the workplace. Here are just some tips on how to plan for that return:

  • Communicate, communicate, communicate
    • Many people are experiencing heightened anxiety and fear due to all of the unknowns right now. While employers are also trying to navigate the many unknowns, it is beneficial to keep employees informed of tentative dates of reopening (to the extent possible and with the understanding that these dates are flexible), what the “new normal” might look like when they get back to the office, and what the employer will do to ensure a safe work environment. Sending periodic emails about these items prior to opening the workplace might relieve some of the anxieties that employees are facing right now.
    • Many employees will be scared or reluctant to come back to work. It is best practice to be aware of employee’s concerns, and remain communicative on what you are doing to create a safe work environment for employees. Remind employees to talk to their supervisors/HR if they have any issues so they can be addressed early on. It is also important to remind employees that they will not be retaliated against for expressing their concerns.
  • Social Distancing Measures
    • Consider restructuring the workplace to increase physical space between employees, as well as customers and other visitors. This may include installing plexiglass or other physical barriers, or removing some chairs or tables in break rooms and other common spaces to reduce the risk of too many employees congregating.
    • Host meetings virtually when possible, or limit the amount of people physically present.
    • If possible, stagger attendance or limit who can be at the workplace to “essential” employees and allow others to work remotely.
    • Stagger breaks to limit the amount of people in the break room or other common areas at any given time.
    • Discourage people from shaking hands, hugging, or otherwise coming into physical contact with other individuals (including customers and vendors). 
    • Limit business travel
    • Require customers to pay online or via a handsfree device to limit the exchange of money and credit cards
  • Safety Measures
    • Remind employees to engage in appropriate hygiene practices, including washing hands regularly, covering their mouths when they cough, not touching their eyes, nose, or mouth, etc.
    • Require employees to wear personal protective equipment (PPE) like masks and gloves when around other individuals, including employees, customers, and vendors.
    • Provide tissues, no touch receptacles, soap and water, hand sanitizer, and cleaning sprays/wipes to employees to help them keep their workspace clean. 
    • Be diligent about cleaning the workplace. Designate an employee(s) to clean high-touch areas throughout the day and remind employees to keep their workspace clean. 
  • Employee Screening Procedures
    • Employers have different options for screening employees during the pandemic that would not otherwise be legal under the Americans with Disabilities Act. Employers may take employees’ temperatures before they are allowed to enter the workplace, or may require employees to get tested for COVID-19 before coming to work. 
    • Employers may ask employees if they are exhibiting common symptoms of COVID-19, such as fever, cough, shortness of breath, or sore throat. Remember to check the CDC website continuously, as the symptoms continue to expand and evolve.
    • Send home any employee who is exhibiting signs of COVID-19 or have a temperature of 100.4 of higher.
    • However, it is important to consider the following:
    • There are specific notice requirements under California law that may be implicated if employers plan to take temperatures or require tests. Check with legal counsel before doing this. 
    • Taking temperatures or tests are not complete safeguards, since some individuals who have the virus may not experience fevers, and a negative COVID-19 test one day doesn’t mean the employee will not be infected the next day. 
    • If checking temperatures, it is recommended to designate a specific person(s) to do this, and maintain a confidential log. It is also recommended to get a contact-free thermometer to reduce the risk of exposure.
    • Non-exempt employees who are sent home early may need to be paid reporting time pay.
    • Non-exempt employees should be paid for time spent taking their temperature or COVID-19 tests if required by the employer.
    • Employers must adhere to privacy laws and keep all medical information confidential, and maintain medical files separate from personnel files.
  • Accommodating Employees
    • Some employees may have underlying health conditions that put them at greater risk of contracting the virus. These individuals may need to be accommodated under the ADA and FEHA or other applicable state laws.
    • Employees with mental health conditions that have been exacerbated by the pandemic may need to be accommodated. 
    • Employees who have child care issues may need to be accommodated under the Expanded Family Medical Leave Act or local ordinances.
    • Remember that a leave of absence is only a reasonable accommodation if there are no other accommodations available that would allow the employee to continue working. Consider various options to try to allow the employee to continue working, and engage with the employee to determine what the employee’s limitations are and how they may be accommodated.
  • Planning for Future Outbreaks
    • As the economy opens back up and people are permitted to return to work, the virus will continue to spread. Create a plan for if/when an employee, customer, or vendor notifies you that he/she has been infected. This should include determining how to inform employees while maintaining confidentiality; cleaning the workplace thoroughly and perhaps hiring a third-party cleaning service to conduct a deep-clean; informing vendors and customers of any temporary shutdown of the business; hiring temporary workers to continue operations if a portion of the workforce is out sick.
  • Remember to comply with all wage and hour laws, and avoid potential claims of discrimination by treating all employees equally, unless they request accommodation (i.e. don’t exclude individuals over 65 or other high-risk individuals from the workplace just because they are higher risk – wait until they ask for accommodations before assuming they need one)

Celebrating Its 23rd Anniversary – S&W Promotes Three New Partners and Launches New Website

by Gerald Sauer

On the 23rd anniversary of its founding, Sauer & Wagner LLP is pleased to announce the promotion of Gregory Barchie, Amir Torkamani and Sonya Goodwin to Partner.  

Gregory Barchie has substantially litigated commercial, entertainment, real estate, employment, and intellectual property disputes in federal and state courts and in private arbitrations. Greg joined S&W in 2015 and has served as a member of the Board of Governors of the Beverly Hills Bar Association, President of the “Out of Court” section of the Beverly Hills Bar Association, and President of the Southern California Business Litigation Inn of Court. He successfully defended a guarantor on a multi-million-dollar loan case involving the “sham guaranty” doctrine and prevailed on several anti-SLAPP motions including against claims for breach of contract/lease in an environmental contamination case, and fraud and intentional interference with economic advantage in a dispute between a borrower and mortgage loan brokers.

Amir Torkamani, who joined S&W in June 2012, focuses on commercial, entertainment, real estate, employment, and intellectual property litigation and has substantial experience handling jury and bench civil trials in federal and state courts, as well as litigating disputes in private arbitrations. He was recognized for obtaining one of the Top 100 Jury Verdicts in California in 2019 and was named a Rising Star by Southern California Super Lawyers in 2013 – 2018. Amir’s successes include the favorable settlement of a multi-million-dollar real estate dispute involving return of a substantial security deposit after the tenant had failed to pay rent and substantially damaged the property, as well as a commercial lease dispute involving a tenant facing eviction and substantial interruption of a machining and product development company.
Amir received a Bachelor of Arts degree in political science and a Bachelor of Science degree in business administration, both at the University of California, Berkeley. He earned his J.D. from the University of Southern California.

Sonya Goodwin joined S&W at the end of 2019. She has focused her practice exclusively in the employment arena, counseling both employers and employees in a wide variety of employment issues including wage and hour issues, discrimination, harassment, retaliation, wrongful termination, defamation, intentional infliction of emotional distress and breach of contract, as well as conducting investigations of workplace issues. She serves on the Executive Committee of the Beverly Hills Bar Association’s Labor and Employment Law Section.

Sonya earned her Bachelor of Arts degree, in history and international studies, from the University of California, San Diego. She attended UCLA School of Law, where she received her J.D.

S&W also released its redesigned website as part of the celebration of its 23rd anniversary. The website is located at www.swattys.com.   

Judge Orders Preliminary Injunction on Law Prohibiting Mandatory Arbitration Agreements in California

by Gerald Sauer

Earlier this month, a District Court judge issued a preliminary injunction on the enforcement of Assembly Bill 51 (“AB 51”), the new law that prohibits mandatory arbitration agreements in the employment context.   The business groups that filed suit against the bill argued that it was preempted by the Federal Arbitration Act (“FAA”) because (1) it puts arbitration agreements on an unequal footing from other contracts, which is prohibited by the FAA, and (2) it conflicts with the objectives of the FAA to promote arbitration.  

In her order, the judge found that the business groups were likely to prevail on the merits and face irreparable harm if the preliminary injunction is not issued.  However, it is important to note that the injunction only applies to arbitration agreements covered by the FAA – in other words, if the employment relationship involves interstate commerce. 

Accordingly, mandatory arbitration agreements governed by the FAA are still enforceable in California, for now.  The law was set to go into effect on January 1, 2020, but is now on hold until the judge makes a final decision on the merits, or the preliminary injunction order is appealed to the Ninth Circuit and, possibly, to the U.S. Supreme Court.  Either way, this issue is not likely to be resolved by the end of this year. 

California Consumer Privacy Act (CCPA)

by Gerald Sauer

The new year has brought with it many changes in the law that affect employers and employees in California.  One of those laws, the California Consumer Privacy Act (CCPA), became effective January 1, 2020 and will be enforced starting July 1, 2020.  The law, enacted in 2018, requires for-profit businesses (including most employers) to disclose to consumers (including employees) certain categories of data collected by the business and requires the deletion of data upon request by the consumer. 

Employers are exempt from some of the law’s provisions until January 1, 2021. Here is a guide to help employers determine if the CCPA applies to them and how it will impact their business in the next year:

What is a covered entity?

The CCPA applies to any for-profit business who meets these criteria:

Applicants, employees, and independent contractors have a right to request (1) that the business tell them what personal information it has collected, sold, or disclosed, and to whom; (2) that the business delete their personal information; (3) a copy of the information that has been collected, sold, or disclosed; and (4) to opt out of the sale of their personal information. Employees may not be retaliated against for exercising these rights.

  • Has annual gross revenues in excess of $25 million; OR
  • “Alone or in combination, annually buys, receives for the business’s commercial purposes, sells, or shares for commercial purposes, alone or in combination, the personal information of 50,000 or more consumers, households, or devices;” OR
  • “Derives 50 percent or more of its annual revenues from selling consumers’ personal information.”

A “consumer” is any “natural person who is a California resident,” which includes a “job applicant to, an employee of, owner of, director of, officer of, medical staff member of, or contractor of that business.”


How will this impact covered employers starting January 1, 2020?

  1. Covered employers must provide notice of the type of data collected from their employees and customers and the purpose of the collection. Data is defined broadly to include “professional or employment related information,” “education information,” “identifiers,” “characteristics of a protected category,” “biometric information,” “internet activity,” “inferences drawn regarding a consumer’s preferences, characteristics, psychological trends, predispositions, behavior, attitudes, intelligence, abilities, and aptitudes,” and “geolocation data.”
  2. A private right of action (on an individual or class-wide basis) allows recovery of statutory damages ranging from $100-$750 per employee per incident for any unauthorized disclosure or access to the data.
  3. Applicants, employees, and independent contractors have a right to request (1) that the business tell them what personal information it has collected, sold, or disclosed, and to whom; (2) that the business delete their personal information; (3) a copy of the information that has been collected, sold, or disclosed; and (4) to opt out of the sale of their personal information. Employees may not be retaliated against for exercising these rights.

Employers do not have to delete data that is maintained solely for internal uses reasonably in line with the purpose for which it was collected (i.e. human resources or other employment-related purposes), or if required to comply with a legal obligation. Given that California employment laws require maintenance of employment records for at least three or four years, the deletion will not be required for most applicant, employee, and independent contractor data otherwise subject to the CCPA’s protections. 

If you have any questions about compliance with the CCPA, please contact us.

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