Discussion

The California Public Health Department (CDPH) recently updated its COVID-19 guidance to adjust isolation requirements. The CDPH has shifted the focus of its policies and priorities for intervention to protecting those most at risk for serious illness, and keeping recommendations consistent with the prevention of other endemic respiratory viral infections. COVID-19 vaccination remains the CDPH’s most important strategy to prevent serious illness and death from COVID-19, as well as focusing on early treatments to reduce the severity of disease once individuals are infected.

What is the new guidance?

The new guidance tells people to stay home if they have COVID-19 symptoms. People can end isolation 24 hours following the end of a fever (without fever-reducing medication) and their symptoms are mild and improving. However, people are instructed to mask for 10 days after becoming sick or testing positive. Masks may be removed sooner than 10 days following two sequential negative tests at least one day apart. Those with COVID-19 should avoid contact with people at higher-risk for severe COVID-19 for 10 days, including the elderly, those who live in congregate care facilities, those who have immunocompromising conditions, and that put them at higher risk for serious illness.

Do the Cal/OSHA Non-Emergency Regulations still apply to employers?

Yes. Employers must still follow the non-emergency regulations for COVID-19 cases. Because the regulations look to the CDPH rules on when isolation is required, the new CDPH isolation guidelines must be followed for individuals with COVID-19 symptoms. Note that for COVID-19 cases with no symptoms, there is no infectious period for the purpose of isolation or exclusion.

CDPH no longer recommends testing for all close contacts and instead recommends testing only for all people with new COVID-19 symptoms, and close contacts who are at higher risk of severe disease or who have contact with people who are at higher risk of severe disease. Regardless of CDPH recommendations, employers must continue to make COVID-19 testing available at no cost and during paid time to all employees with a close contact, except for asymptomatic employees who recently recovered from COVID-19. Employers must also still follow the regulations rules on outbreaks.

Does this updated guidance apply to healthcare settings?

No. ​This guidance does not apply to healthcare personnel. Healthcare personnel in general acute care hospital​​, acute psychiatric​ hospital, and skilled nursing facilities should continue to follow their industry-specific regulations.

Action Items

1. Review the updated guidance here.
2. Review updates to the Cal/OSHA Non-Emergency Regulation guidance here.
3. Have policies and procedures updated.
4. Have appropriate personnel trained on the new guidelines.

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. © 2024 ManagEase

Discussion

HB 55 states that requiring employees to enter into a confidentiality clause regarding sexual misconduct, as a condition of employment, is against public policy and is void and unenforceable. A confidentiality clause includes nondisclosure or nondisparagement clauses that have the effect of prohibiting employees or former employees from talking about sexual assault or sexual harassment.

Employers also may not retaliate against any employee because they made an allegation of sexual harassment or assault, or if they refused to enter into a confidentiality agreement as a condition of employment. An employee may, within three business days after the day on which the employee agrees to a settlement agreement that includes a confidentiality clause regarding sexual misconduct, withdraw from the settlement agreement.

HB 55 does not prohibit confidentiality of the amount of a monetary settlement or facts that could lead to the identification of the employee. Employers may still require employees to sign a post-employment restrictive covenant or agree to keep confidential an employer’s non-public trade secrets, proprietary information, or confidential information that does not involve illegal acts. The bill also does not prohibit an employee from discussing sexual misconduct or allegations of sexual misconduct in a civil or criminal case when subpoenaed if the sexual misconduct or allegations of sexual misconduct are against the individual whom the employee alleged engaged in sexual misconduct.

An employer who attempts to enforce a confidentiality clause is liable for all costs, including reasonable attorney fees, resulting from legal action to enforce the confidentiality clause; and is not entitled to monetary damages resulting from a breach of a confidentiality clause. Although the bill went into effect February 28, 2024, by its own terms, it is retroactively applied to January 1, 2023.

Action Items

1. Review HB 55 here.
2. Have confidentiality clauses revised.
3. Have appropriate personnel trained on the requirements.
4. Consult with legal counsel regarding retroactive application of HB 55.

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. © 2024 ManagEase

Discussion

On January 10, 2024, the U.S. Department of Labor (DOL) published a final rule on how to determine whether a worker qualifies as an independent contractor or an employee under the Fair Labor Standards Act (FLSA). The DOL’s original proposed rule was published in July of 2023 and received over 55,000 comments. Absent any significant legal challenges, the final rule is set to take effect on March 11, 2024.

The rule returns to a six-factor, economic realities test that asks whether a worker is economically dependent on the employer to determine independent contractor status. The six factors are: (1) opportunity for profit or loss depending on managerial skill; (2) investments by the worker and the potential employer; (3) degree of permanence of the work relationship; (4) the nature and degree of control exercised by each party over the work; (5) extent to which the work performed is an integral part of the potential employer’s business; and (6) skill and initiative. Each factor is briefly described below.

1. Opportunity for Profit or Loss

This factor considers whether the worker has opportunities for profit or loss based on their opportunity to exercise managerial discretion. A worker who has no such opportunity is likely to be considered an employee. Notably, the final rule clarifies that the decision to work more hours or take more jobs when paid a fixed rate per hour or per job typically does not require the exercise of managerial skill/discretion that would be required for an independent contractor classification. Instead, the factor looks at whether, among other things, the individual can meaningfully negotiate the charge or pay for the work provided, whether the worker engages in marketing, advertising, or other efforts to expand their business or secure more work, and whether the worker makes the decision to hire others, purchase materials/equipment, and/or rent space.

2. Investments by the Worker and the Potential Employer

This factor focuses on whether the worker’s investments are capital or entrepreneurial, meaning whether they “support an independent business and serve a business-like function.” Costs incurred by the worker for tools and equipment to perform a specific job, for specific labor, and that the potential employer imposes, unilaterally all favor a classification of employee, as opposed to independent contractor.

3. Degree of Permanence of Work Relationship

The degree of permanence factor focuses on the duration and longevity of the working relationship. Relationships that are indefinite, continuous, or exclusive tend to favor more toward an employee classification, whereas relationships that are definite in duration, non-exclusive, or sporadic tend to lean in favor of an independent contractor classification. The final rule clarifies that the ultimate question under this factor is whether short periods of work are due to workers acting independently to obtain business opportunities or whether they are due to the operational characteristics of particular industries.

4. Nature and Degree of Control

This factor focuses on the level of control that a prospective employer exercises over the worker. Under the final rule, “actions taken by the potential employer that go beyond compliance with a specific, applicable federal, state, tribal, or local law or regulation and instead serve the potential employer’s own compliance methods, safety, quality control, or contractual or customer service standards may be indicative of control.” Therefore, actions taken by a potential employer with the sole purpose of complying with a specific law or regulation would not, on its own, indicate an employer-employee relationship. However, if an employer asserts control over other aspects of the relationship such as, but not limited to, the worker’s schedule, work performance, worker discipline, or otherwise demands or restricts the worker in a way that prevents the worker from working for others, such aspects of the work relationship would tend to indicate an employee classification.

5. Integral Part of Employer’s Business

To determine whether work is an “integral part” of the prospective employer’s business, employers must conduct an evaluation of whether the function the worker is performing is “critical, necessary, or central” to the employer’s primary business. This focuses on the work performed in relation to the business of the company, as opposed to whether the workers themselves are integral to the business. Where work performed is determined to be “critical, necessary, or central,” then this factor favors an employee classification under the final rule.

6. Skill and Initiative

The last factor focuses on whether the worker uses specialized skills for the work performed, and where “those skills contribute to business-like initiatives,” this factor will favor classifying the individual as an independent contractor. That said, the DOL clarifies that the use of specialized skills is just part of the inquiry, and workers who lack specialized skills may nevertheless be classified as independent contractors. Therefore, the central question instead is whether the worker’s skills contribute to business-like initiatives. In situations where the worker relies on the employer to provide training to perform the work, this factor favors employee classification.

Moving Forward for Employers

Unlike the prior 2021 rule that held two “core” factors above another three “less probative” factors, no one factor in the economic reality test is intended to be determinative of the working relationship. Instead, all factors should be weighed equally to consider the totality of the circumstances in each case. Additional factors may be considered if they are relevant to the overall question of economic dependence.

Notably, the DOL has indicated that the new rule “is not intended to disrupt the business of independent contractors who are, as a matter of economic reality, in business for themselves.” The DOL has signaled that its early enforcement initiatives will be directed toward workers in low-income industries, as well as the construction and healthcare industries.

As employers begin to audit their existing independent contractor relationships in light of this final rule, they should keep in mind that this rule only applies to classifications under the FLSA, and not to other federal or state laws (e.g., those governed by the IRS, NLRB, state unemployment insurance, state wage and hour laws, etc.). If other laws impose different or stricter classifications tests, the employer should continue to abide by all applicable classification requirements.

Action Items

1. Review independent contractor relationships with counsel to determine proper classification and re-classify workers if necessary.

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. © 2024 ManagEase

Discussion

On January 30, 2024, the Federal Acquisition Regulatory Council published the proposed rule “Prohibition on Compensation History Inquiries and Requirement for Compensation Disclosures by Contractors During Recruitment and Hiring” (Proposed Rule). It would apply to federal contracts and subcontracts for commercial products or services valued in excess of $10,000 or more and to be performed within the United States. The Proposed Rule is limited to the recruitment and hiring of positions that will perform work on or in connection with a federal contract or subcontract. Like most pay transparency laws and salary history bans, the goal of the Proposed Rule is to promote pay equity. The specific requirements of the Proposed Rule are detailed below. Affected parties have until April 1, 2024 to comment on the Proposed Rule.

Pay Transparency

Federal contractors and subcontractors would have to disclose the salary or wage range the contractor in good faith believes it will pay for the advertised position in all job advertisements. The contractor’s pay scale, range of compensation for those currently working in similar jobs, or the amount budgeted for the position can be used to determine the salary range. There must also be a general description of benefits and other forms of compensation. Compensation includes “payments made to, or on behalf of, an employee or offered to an applicant as remuneration for employment, including but not limited to salary, wages, overtime pay, shift differentials, bonuses, commissions, vacation and holiday pay, allowances, insurance and other benefits, stock options and awards, profit sharing, and retirement.”

Salary History Ban

The salary history, or compensation history, inquiry prohibition is similar to state and local salary history bans. Federal contractors would be prohibited from:

• Seeking an applicant’s compensation history, either orally or in writing, directly from any person, including the applicant or the applicant’s current or former employer or through an agent;
• Requiring disclosure of compensation history as a condition of an applicant’s candidacy;
• Retaliating against or refusing to interview or otherwise consider, hire, or employ any applicant for failing to respond to an inquiry regarding their compensation history; and
• Relying on an applicant’s compensation history to screen or consider the applicant for employment or in determining the compensation for the applicant at any stage in the selection process.

Compensation history is defined as the compensation an applicant is currently receiving or the compensation the applicant has been paid in a previous job. The prohibition also applies to current employees moving to a new role within the company. Federal contractors are also prohibited from using salary history even if an employee voluntarily discloses it.

Additional Requirements

Federal contracts will need to include a specific contract clause detailing the requirements in all solicitations and subcontracts where the principal place of performance is within the United States. This includes flow down requirements.  Additionally, both the salary history ban and pay disclosure require a written notice to applicants as part of the job advertisement or application process. The language for the notice is contained in the required contract clause provisions and must: (1) notify applicants about the prohibitions under the Proposed Rule; (2) provide details on how to file a complaint; and (3) include instructions on how to file a discrimination complaint with the Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP).

Action Items

1. Read the Proposed Rule here.
2. Review contracts that may be affected by the Proposed Rule.
3. Plan for potential compliance and review current pay transparency and salary history ban requirements in jurisdiction of business operations.

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. © 2024 ManagEase

Discussion

Several amendments to Colorado’s Equal Pay for Equal Work Act (EPEWA) create additional requirements for employers. The Colorado Department of Labor and Employment (CDLE) issued final regulations and Interpretive Notice & Formal Opinion (INFO) #9A to clarify the amendments.

Job Opportunity Posting

Employers must announce, post, or otherwise make known a job opportunity to all Colorado employees on the same calendar day and prior to the date of a selection decision. A job opportunity is “a current or anticipated vacancy for which the employer is considering a candidate or candidates or interviewing a candidate or candidates or that the employer externally posts.” The job opportunity notice must be made available regardless of where the job is to be performed and regardless of whether a Colorado employee would qualify for the job opportunity. If the job opportunity is to be primarily performed or could be performed in Colorado, then the notice must include:

• the hourly rate or salary compensation (or a range thereof) that the employer is offering for the position;
• a general description of any bonuses, commissions, or other forms of compensation that are being offered for the job;
• a general description of all employment benefits the employer is offering for the position, including healthcare benefits, retirement benefits, any benefits permitting paid days off (including sick leave, parental leave, and paid time off or vacation benefits), and any other benefits that must be reported for federal tax purposes, but not benefits in the form of minor perks;
• the application deadline; and
• how to apply for the job opportunity.

The notice requirements can be linked elsewhere, like to a website. Reasonable methods can be used for employees to access the notice so long as employees can access it within their regular workplace or are told where to find it. The amendments maintain pre-existing exceptions to the job opportunity notice requirements for confidential replacements of current employees unaware of their separation.

Post-Selection Notice

Once an employer selects a candidate, they must provide notice to existing Colorado employees who will work with the candidate regularly. The notice must contain: (1) the name of the selected candidate; (2) the employee’s former job title (if applicable); (3) the new job title; and (4) information on how employees may demonstrate interest in similar job opportunities. These notices must be provided within 30 days after the selected candidate begins work. Notices can be combined for several selections at once. Employers do not have to provide a post-selection notice when disclosing a selected candidate’s name and/or prior job title if doing so would violate a law or if a selected candidate voluntarily requests to be exempted from the notice. Reasonable methods can be used for employees to access the notice so long as employees can access it within their regular workplace or are told where to find it.

Exceptions

Small Employers. Employers outside of Colorado with 15 or less remote Colorado employees only have to provide remote job opportunity notices. This requirement sunsets on July 1, 2029, at which point all job opportunities available company-wide must be included in job opportunity notices.

Career Development. Career progression or development promotions are excluded as job opportunities, so they do not trigger job opportunity or post-selection notice requirements. Separately, a career progression promotion has its own notice requirement. A career progression is “a regular or automatic movement from one position to another based on time in a specific role or other objective metrics.” Such notices must include the requirements for career progression, in addition to each position’s terms of compensation, benefits, full-time or part-time status, duties, and access to further advancement.

Geographic Limitations. All notices are to be provided to Colorado employees only. This is even if the opportunity or selected candidate is outside Colorado.

AINT Positions. Acting, interim, or temporary positions (AINT) do not require an immediate job opportunity notice where the hiring is not expected to be permanent, and the position was not held any time in the preceding 12 months by another AINT hire which did not have a job opportunity posting.

Action Items

1. Review the final regulations here.
2. Revise job postings to include application deadlines.
3. Draft post-selection notice templates and determine distribution method.
4. Review promotion categories to see if they qualify as a career development or career progression.
5. Have appropriate personnel trained on the requirements.

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. © 2024 ManagEase