[Source: Bloomberg Law] California enacted a slate of new laws on worker classification, Covid-19, family leave, and court issues that will affect how employment lawyers advise their clients on workplace compliance and litigate disputes.
The measures come as the state grapples with a global pandemic, devastating wildfires, and a swelling racial justice movement, and employers work to keep up with emergency measures and implement policy changes.
“I have seen people already scrambling to comply with existing measures, but now I think we will start to see an uptick in action that could lead to lawsuits,” said September Rea, a management-side attorney with Polsinelli.
“My biggest concern is that employers are so focused on Covid-19 and the focus on social justice issues, that they aren’t as prepared, because you can bet the plaintiffs counsel is definitely paying attention,” she said.
Among legislation signed by Gov. Gavin Newsom (D) is a bill (A.B. 2257) that makes it easier for businesses to classify gig workers in nearly 40 professions as independent contractors instead of employees entitled to minimum wages, overtime pay, and other job protections. That law responds to opposition against Assembly Bill 5, a measure that went into effect in January and sparked legal challenges by gig economy businesses.
Newsom also signed laws requiring employers to notify workers of Covid-19 exposure, allowing coronavirus-infected workers to file workers’ compensation claims, and mandating 12 weeks of leave to workers caring for a family member. Two laws also could make some aspects of litigation easier by extending legal deadlines and ensuring uniformity for how courts comply with statewide emergency orders.
One bill still awaiting the governor’s signature would establish workforce pay reporting based on race and sex.
“The hope with some of these laws is that employers will change their practices, and then there won’t be a need for litigation,” said Daniel Hutchinson, a partner in San Francisco for plaintiff firm Lieff Cabraser Heimann & Bernstein. “Many of the measures are a specific response to a pandemic to make sure that the state has the best practices in place to protect its workers.”
Freelancer Exemptions
Under one new law, A.B. 5 exemptions for dozens of professionals—from musical performers and web designers to golf caddies and event planners—apply as long as certain criteria are met.
The law also repealed a provision in A.B. 5 that limited freelance journalists to 35 submissions per year per employer if they want to be independent contractors. But that amendment won’t stop a legal challenge from freelance journalists, who say the revised exemption doesn’t fix the underlying issues created by A.B. 5.
Michael Kelly, an employment attorney with Squire Patton Boggs LLP in San Francisco, said the new law amounts to “cleaning up around the margins” of A.B. 5 as it relates to well-established relationships between freelance writers, photographers, and other professions, and the businesses that request the work.
“In the core technology sector, in the core business and manufacturing [sector] I don’t think the new law is making it easier to bring in independent contractors, I think that’s still going to be hard,” Kelly said.
Covid-19 Reporting
Starting next year, California will require employers to notify workers within one day if an employee tests positive for Covid-19 and allow the state’s Division of Occupational Safety and Health (Cal/OSHA) to shut down a work site if the coronavirus poses an “imminent hazard” through Jan. 1, 2023.
Cal/OSHA issued guidance to help employers comply with the new law (A.B. 685). But the California Chamber of Commerce and other business groups say the law’s language is too vague in how it defines employee notification of Covid-19 infections.
There are three different definitions in the law for the types of employees who must receive notice: those who were at the same work site as the sick employee during the infectious period; those who may have been exposed; and “all employees.”
These different categories could be confusing to employers, said Benjamin Ebbink, a labor and employment attorney with Fisher Phillips in Sacramento.
“I think employers need to pretty quickly prepare for January 1,” Ebbink said, advising them to create draft notices in case an employee gets infected with the virus.
Virus Workers’ Compensation
California’s essential workers can claim that they caught the coronavirus on the job and receive workers’ compensation benefits under state Sen. Jerry Hill‘s (D) measure (S.B. 1159). The law went into effect immediately after Newsom signed it on Sept. 17.
Police officers, firefighters, and certain health-care employees have until Jan. 1, 2023, to apply for workplace injury benefits. Employers can counter those claims with evidence that the individual didn’t get sick at work.
The measure will mostly affect employers that don’t provide health insurance to many of their employees, Kelly of Squire Patton Boggs said. That’s because employees with insurance are more likely to get treated through their health-care system than through the workers’ compensation system. Small businesses will be disproportionately hurt by the policy, he added.
But Cheryl Sabnis, an attorney with King & Spalding LLP in San Francisco, said the legislation will protect both sides from uncertainty if workers get sick on the job.
“It’s an attempt to make sure that employers and employees can move forward with comfort,” she said.
Family Leave
California’s new family-leave measure (S.B. 1383) ensures that workers at jobs with five or more employees can take up to 12 weeks off to care for a new baby, a sick family member, or themselves.
The new law closes a gap in the federal and state patchwork of leave laws, according to bill author Sen. Hannah-Beth Jackson (D).
Small technology startups that weren’t required to provide 12 weeks of leave probably won’t be affected because their managers like to offer generous benefits to attract top applicants, Kelly said.
But for traditional mom-and-pop businesses, it’s going to create compliance headaches, he said.
“Managing medical leave is complicated and requires a certain amount of sophistication in your HR team,” Kelly said.
Pay Gap Data
Jackson also wrote a bill (S.B. 973) requiring businesses with 100 or more employees to report employee wages by race and gender and submit that information to the California Department of Fair Employment and Housing. Newsom has until Sept. 30 to sign the bill.
If enacted, it would follow the end, for now, of pay reporting to the U.S. Equal Employment Opportunity Commission. That data collection was mired in litigation after the Trump administration blocked Obama-era plans to gather employer pay information in an effort to combat wage gaps.
The California Chamber of Commerce and other groups say an employee’s experience and education—which determine salaries—aren’t reflected in these forms. Some business groups fear these data could trigger an investigation when there isn’t any race- or gender-based discrimination.
“While the goal is laudable, it is difficult to assess these things in a one-size-fits-all fashion,” said Sabnis of King & Spalding.
Court Changes
Employment attorneys juggling deadlines and depositions may get some relief from legislation (S.B. 1146) affecting litigation procedures.
The law immediately extends deadlines on discovery, disclosure of experts, mandatory settlement conferences, and serving documents—provisions that the state Judicial Council adopted when California’s shelter-in-place order was issued in response to the pandemic.
The legislation allows remote—rather than face-to-face—depositions and makes the physical presence of parties or attorneys of record optional at depositions.
Another law (A.B. 3366) adds uniformity to how California declares statewide emergency orders affecting courts.
The California Supreme Court chief justice can issue an emergency order statewide without having to ask the governor for permission or waiting for individual courts to request an order. More than 100 requests for various kinds of relief were made in the two months following the statewide emergency declaration.
The changes are a “big help” for attorneys, Sabnis said.
“What Covid exposed is that every court was doing things slightly differently,” she said.
Source: Bloomberg Law
September 24, 2020
