California: October is here! New Laws are Coming!

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October in California means preparing for new laws in 2022. The Governor recently signed a new slate of bills into law. The following is a summary of key rules employers should be aware of.

OCT 5, 2021 | AB 654 – COVID-19 Safety Rule Update! AB 654 revises and clarifies employers’ COVID-19 workplace exposure notice and reporting requirements under last year’s AB 685.

Employer notice requirements for COVID-19-related benefits must be sent to employees who were “on the premises at the same worksite as the qualifying individual within the infectious period.”
Employer notice requirements for employees, employers of subcontracted employees, and exclusive representatives (if any) who were “on the premises at the same worksite as the qualifying individual within the infectious period” must include the employer’s cleaning and disinfection plan consistent with CDC guidelines and the employer’s COVID-19 prevention program per the Cal/OSHA COVID-19 Emergency Temporary Standard.
Employers must provide notice of COVID-19 outbreaks to local public health agencies “within 48 hours or one business day, whichever is later.”
Definitions of “close contact,” “high risk exposure period,” and “worksite” were changed to align with Cal/OSHA’s definitions.
COVID-19 notice and reporting requirements were removed for certain healthcare and childcare employers since they are already subject to other requirements specific to their industries.

JAN 1, 2022 | AB 701 – Warehouse Worker Quotas Restricted. AB 701 requires employers with 100 or more employees at a single warehouse distribution center or 1,000 or more employees at one or more warehouse distribution centers in the state to provide nonexempt employees with a notice of their quota requirements and potential adverse action if quotas are not met. The notice must be provided to existing employees by January 30, 2022 and upon hire thereafter. Quotas are prohibited if they prevent compliance with meal or rest periods, use of bathroom facilities, or occupational health and safety laws.

If a current or former employee believes that a quota violated meal and rest or safety laws, employers must provide the employee, within 21 days of a request, with a written description of each quota to which the employee is subject and a copy of the most recent 90 days of the employee’s own personal work speed data (if such data is collected). There is a rebuttable presumption against employers who take adverse action against an employee within 90 days of requesting quota or personal work speed data or making a claim about quotas.

JAN 1, 2022 | AB 1003 – Intentional Wage Theft is a Felony. AB 1003 states that an intentional failure to pay wages, gratuities, benefits, or other compensation knowingly due to employees or independent contractors, in an amount greater than $950 from any one individual or $2,350 in the aggregate from two or more individuals in any 12-month period, may be punished as grand theft.

JAN 1, 2022 | AB 1023 – Public Works Reporting. AB 1023 defines public works employer reporting requirements under Labor Code § 1776 to be electronically submitted at least once every 30 days while work is being performed on the project and within 30 days after the final day of work performed on the project.

JAN 1, 2022 | AB 1033 – CFRA Updates. AB 1033 corrects the California Family Rights Act (CFRA) to include “parent-in-law” in the definition of “parent” to be consistent with corresponding regulations. The bill also modifies the small employer family leave mediation pilot program implementing new procedural details.

JAN 1, 2022 | AB 1506/AB 1561 – Updates to Independent Contractor Rules under AB 5. AB 1506 expands the definition of “newspaper” and “newspaper carrier” for purposes of AB 5’s independent contractor rules, and sets forth reporting requirements for newspaper publishers and distributors. It also clarified the requirements of a “manufactured housing salesperson” using the Borello test. AB 1561 also updates the requirements for a data aggregator and those identified in the insurance industry using the Borello test.

JAN 1, 2022 | SB 62 – Wage and Hour Changes for Garment Workers. SB 62 prohibits paying garment workers on a piece rate basis; they must be paid at an hourly rate at least at the applicable minimum wage. Enforcement is limited to filing a claim with the Labor Commissioner. Violators are subject to a $200 penalty per employee for each pay period in which each employee is paid by the piece rate.

The bill also creates joint and several liability among garment manufacturers, contractors, and brand guarantors for wages, expenses, and other compensation regardless of how many layers of contracting are involved; liability also includes attorneys’ fees and civil penalties. Enforcement is limited to filing a claim with the Labor Commissioner.

Wage and hour records, contracts, specified purchase and sales documentation, and garment licenses must be kept for four years. Brand guarantors must also keep contract worksheets indicating the agreed price per unit, specified purchase and sales documentation, and garment licenses for four years.

JUL 1, 2022 | SB 270 – Public Employee Unions. SB 270 allows unions representing public sector employees to file an unfair practice charge for reporting violations following specific written notice requirements, including a 20-day opportunity to cure. An employer’s failure to report the required information may result in a $10,000 civil penalty.

JAN 1, 2022 | SB 331 – Nondisclosure Clause Restrictions Expanded. SB 331 expands existing restrictions of nondisclosure provisions in settlement agreements related to claims filed in a civil action or a in an administrative action. Specifically, any settlement agreement entered on or after January 1, 2022 that prevents or restricts an employee from disclosing factual information of any type of harassment, discrimination, or retaliation (not just based on sex), is unenforceable.

Additionally, employers are prohibited from requiring employees to enter into nondisparagement or nondisclosure agreements on or after January 1, 2022 that would prevent an employee from disclosing information about “unlawful acts in the workplace.” Nondisclosure agreements, including severance agreements, must include the following or substantially similar language: “Nothing in this agreement prevents you from discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination or any other conduct that you have reason to believe is unlawful.” Employers may still protect their trade secrets, proprietary information, or confidential information that does not involve unlawful acts in the workplace.

Severance agreements must also include notice to the employee that they have a right to consult an attorney regarding the agreement and provide the individual with at least five business days to review the severance agreement. The amount of a severance may still remain confidential.

JAN 1, 2022 | SB 338 – Port Drayage Expanded Joint Liability. Port drayage companies may currently be held jointly and severally liable for motor carrier wage and hour violations. SB 338 expands the joint and several liability to include employment tax assessments and failure to comply with health and safety laws.

JAN 1, 2022 | SB 572 – Liens Against Employers. SB 572 permits the Labor Commissioner to seek a lien on employers’ real property, as an alternative to a judgment lien, to secure an amount due to the Labor Commissioner under any final citation, findings, or decision.

JAN 1, 2022 | SB 606 – Cal/OSHA Expands Employer Violations. SB 606 creates two new categories of violations subject to Cal/OSHA enforcement. First, there is a rebuttable presumption of an “enterprise-wide violation” if (1) an employer has a written policy or procedure that violates Cal/OSHA standards, rules, orders, or regulations, or Health & Safety Code § 25910; or (2) there is evidence of a pattern or practice of the same violation(s) committed by the employer involving more than one of the employer’s worksites.

Second, where an employer has “willfully and egregiously” violated a Cal/OSHA standard, order, or regulation, Cal/OSHA will issue a citation for each egregious violation. Each instance of an employee exposed to that violation is considered a separate violation for purposes of fines and penalties.

JAN 1, 2022 | SB 639 – Sub-minimum wage elimination. SB 639 phases out the use of sub-minimum wages for individuals with disabilities. No new subminimum wage licenses will be issued beginning in 2022, and existing licenses will no longer be renewed as of 2025. Thereafter, regular minimum wage rates will apply.

JAN 1, 2022 | SB 646 – PAGA Carve Out. SB 646 carves out an exception under the California’s Private Attorneys General Act (PAGA) for janitorial employers who enter into a collective bargaining agreement that meets specific requirements.

JAN 1, 2022 | SB 657 – Flexible Posting Requirements. SB 657 states that when an employer is required to physically post information, it may also distribute that information to employees by email with the document(s) attached. However, email distribution does not change the employer’s obligation to physically display the required posting.

JAN 1, 2022 | SB 727 – Contractor Joint Liability. SB 727 expands penalties and liquidated damages that direct contractors are jointly liable for with subcontractors, and broadens direct contractor joint liability to include failure to pay the state unemployment insurance fund or for failure to provide workers’ compensation benefits.

JAN 1, 2022 | SB 807 – Record Retention Amendment. SB 807 requires employers to preserve all records and files related to a Fair Employment and Housing Act complaint against it until the later of either (1) the expiration of the statute of limitations, or (2) the conclusion of the claim (including any appeals). The bill also changes certain aspects of how the California Department of Fair Employment and Housing investigates and prosecutes complaints of employment discrimination.

Action Items

Update COVID-19 exposure notice templates and COVID-19 prevention plan.
Review quota requirements and procedures, if applicable.
Conduct a payroll administration audit to ensure compliance.
Update CFRA leave documentation, as appropriate.
Prepare to change garment workers from piece rate to an hourly rate of pay.
Have nondisclosure and severance agreements updated for compliance.
Review compliance with Cal/OSHA rules.
Provide required posters via email to remote employees.
Update minimum wage for disabled workers.
Update record retention policies and procedures.
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Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.