California Enacts an Increase in Piece-Rate Worker Compensation, with Retroactive Repercussions for Resolving Back Wage Claims Without Litigation

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All California Employers who Employ Piece-Rate Employees

EFFECTIVE

January 1, 2016

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On October 10, 2015, Gov. Brown signed AB 1513 into law, adding Section 226.2 to the California Labor Code.  This legislation is a response to prior court rulings related to required compensation for mandated breaks and other nonproductive time. Specifically, the bill sets forth minimum compensation requirements for rest and recovery periods and other nonproductive time for piece-rate workers, in addition to and separate from their established piece rates.  Each type of compensation must also be documented on an employee’s paystub.  Additionally, employers who have not been paying piece-workers for this additional time have the opportunity to resolve back claims without litigation.  This statute will become effective on January 1, 2016, but will have retroactive repercussions for wages earned as of July 1, 2012.

This information applies to all companies who employ piece-rate workers in California.  Examples of employees who are compensated as piece-rate workers include, but are not limited to, those who may do installation work, closing financial transactions when paid a flat rate, agricultural work, manufacturing work, logistics work when a piece rate applies to drivers’ deliveries, etc.

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California Takes the Lead in Enhancing Protections for Gender Wage Equality & Wage Transparency

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All California Employers and Employees

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January 1, 2016

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On October 6, 2015, Governor Brown signed into law Senate Bill (SB) 358, referred to as the Fair Pay Act.  The Act amends Labor Code Section 1197.5 to require that employers prove wage disparities among men and women are not gender based.  The Act also penalizes employers for preventing employees from discussing wages.  Finally, it increases recordkeeping requirements.  These requirements apply both to California employers and companies with employees in California.  Although the changes become effective January 1, 2016, employers need to prepare for the effects the changes will create.  Additionally, the Act may lead to increased litigation, because the hurdles are being lowered for plaintiffs to bring lawsuits.  It may also be a gateway for new class action lawsuits, because attorneys will likely be looking for systemic gender wage disparity within individual companies.

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Regulation Changes With Regard to Unions

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All Employers

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April 13, 2015

and

September 1, 2015

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With the recent National Labor Relations Board (NLRB) ruling redefining joint employer status, more employers may have to be conscious of the changing regulations regarding collective bargaining procedures. Throughout 2015, the NLRB has issued some updates to the rules governing union elections and petitions. Companies that may now be categorized as a joint employer, and therefore potentially subject to union activity of the shared workforce, should review these updated rules, summarized below.

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NLRB Issues Controversial Decision Redefining Joint Employer Status

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All Employers

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August 27, 2015

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In a 3-2 decision involving Browning-Ferris Industries of California, the National Labor Relations Board revised its standard for determining joint-employer status last Thursday, August 27, 2015.

Specifically, the Board defined an employment relationship as one where the employer either exercises control or has the right to exercise control over the work of the employee. The latter is an added factor meant to bring NLRB standards in line with existing law. Thus, in determining joint employer status, where a “user employer reserves a contractual right to set a specific term or condition of employment for a supplier employer’s workers, it retains the ultimate authority” over the employee and “legal consequences may follow from this choice.”

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U.S. DOL Issues Administrator’s Interpretation on Employee Misclassification

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All Employers

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Immediately

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The misclassification of workers as independent contractors has been an ongoing challenge for employers and workers alike. Due to the fact that contractors lack many workplace protections—such as minimum wage or workers’ compensation rights—and that misclassification results in lower tax revenues for the government, the U.S. Dept. of Labor (“DOL”) recently released Administrator’s Interpretation No. 2015-1. This interpretation, published on July 15, 2015, provides guidance on the existing rules for classifying employees.

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U.S. Dept. of Labor Publishes Proposed Revisions to FLSA Overtime Rules

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All Employers

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July 6, 2015

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After a months-long wait, the U.S. Department of Labor has published a Notice of Proposed Rulemaking (NPRM) regarding amendments to the Fair Labor Standards Act (FLSA) white collar overtime exemption rules. The NPRM was released on July 6, 2015, and outlines new exempt eligibility requirements.

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How the Supreme Court’s Same-Sex Marriage Ruling Impacts Employers

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June 26, 2015

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On June 26, 2015, the closing of Obergefell v. Hodges resulted in a landmark decision by the U.S Supreme Court: same-sex marriages must be licensed and recognized by all states in the nation. Although 37 states had previously legalized same-sex marriage, the Supreme Court’s 5-4 decision will now have significant impact on the 13 states where same-sex marriage was not previously recognized.

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Labor Code Trumps Wage Order 5, Prompting Change in California Meal Periods

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All California Employers

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February 10, 2015

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There are a number of laws setting down rules on the length and timing of employee meal breaks. Thanks to a suit brought by three healthcare workers in Orange County, California, the provisions of Wage Order 5, set forth by the Industrial Welfare Commission (IWC), have been invalidated by the CA Labor Code Sections 512(a) and 516.

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Deadline for California Employers to Update CFRA “Notice B” Approaching

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California Employers with 50 or more Employees

EFFECTIVE

July 1, 2015

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(888) 378-2456

On July 1, 2015, the “Joint Notice for Family Care and Medical Leave (CFRA Leave) and Pregnancy Disability Leave” notice becomes effective. California employers with over 50 employees must post this notice in a visibly conspicuous area on company property. Published by the California Dept. of Fair Employment and Housing, this new “Joint Notice” effectively acts as an update to the “Notice B” poster released in November of 2012.

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Preparing for New Paid Sick Leave Law – Notice and Record Requirements

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All California Employers

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June 10, 2015

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(888) 378-2456

Many employers are aware that California’s new mandatory paid sick leave requires changes in their practices, but are not quite sure of the full extent of the requirements they must meet to be compliant with the law. With the July 1, 2015 deadline for employers to begin providing paid sick leave benefits fast approaching, employers should be aware of the regulations regarding posting, notice, and recordkeeping.

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