On December 30, 2019, Judge Kimberly Mueller of the United States District Court in the Eastern District granted a temporary restraining order, which enjoins California from enforcing AB 51. AB 51 is a California anti-arbitration law signed by Governor Newsom on October 10, 2019 that was scheduled to go into effect on January 1, 2020. The law prohibits employers from requiring that job applicants or workers sign arbitration agreements as a condition of their employment or continued employment. AB 51 specifically states that it is not “intended to invalidate a written arbitration agreement that is otherwise enforceable under the Federal Arbitration Act.” More>>
Federal Court Temporarily Blocks AB 51, California Law Barring Mandatory Employment Arbitration
New California Employment Bills Approved by the Governor
October 13, 2019 was the deadline for Governor Newsom to decide whether to approve or veto several employment bills that were passed by the California Legislature in 2019. The laws signed by Governor Newsom are summarized below and will become effective January 1, 2020 unless otherwise noted.
AB 5 (Independent Contractor v. Employee)
AB 5 codifies Dynamex, a 2018 California Supreme Court decision, and makes workers employees unless the hiring entity demonstrates each of the following factors under the so-called “ABC” test: (A) the person is free from the control and direction of the hiring entity in connection with the performance of the work; (B) the person performs work that is outside the usual course of the hiring entity’s business; and (C) the person is customarily engaged in an independently established trade, occupation, or business. More>>
Reminder Regarding Minimum Wage Increases Effective July 1, 2019
This is a reminder to all employers conducting business in the City of Los Angeles and in the unincorporated areas of the County of Los Angeles, that effective July 1, 2019, minimum wage will increase to $14.25 per hour for employers with at least 26 employees, and to $13.25 per hour for employers with fewer than 26 employees.
Employers conducting business in other cities and counties should review the applicable minimum wage laws in those cities and counties. Effective July 1, 2019, the minimum wage in other cities, including Malibu, Pasadena, Santa Monica, San Jose, Santa Clara, and San Francisco, will also increase. More>>
The California Supreme Court Severely Narrows the Application of the De Minimis Doctrine as a Defense to Wage Claims
On July 26, 2018, the California Supreme Court issued its long-awaited decision in Troester v. Starbucks Corporation, No. S234969 (July 26, 2018) holding that the de minimisdoctrine did not apply under either the Fair Labor Standards Act (“FLSA”) de minimis doctrine or general principles of California law where an employee worked approximately 4-10 minutes off-the-clock per shift. Federal courts have applied the de minimisdoctrine in some circumstances to excuse the payment of wages for small amounts of otherwise compensable time upon a showing that the small amounts of time are administratively difficult to record.
The California Supreme Court departed from the rationale of several federal courts and held that the time the plaintiff spent working off-the-clock performing tasks such as locking the door, activating the alarm, and walking coworkers to their cars for security purposes was not administratively difficult to record and was not de minimis. More>>
Reminder Regarding Minimum Wage Increase Effective July 1, 2018
This is a reminder to all employers conducting business in Los Angeles that effective July 1, 2018, minimum wage will increase from $12 to $13.25 per hour for employers with 26 or more employees, and will increase from $10.50 to $12 per hour for employers with 25 or fewer employees.
The California minimum wage remains $11 per hour for employers with 26 or more employees, and $10.50 per hour for employers with 25 or fewer employees. The California minimum wage will increase on January 1, 2019 to $12 per hour for employers with 26 or more employees and $11 per hour for employers with 25 or fewer employees. More>>
U.S. Supreme Court Approves Employer-Mandated Arbitration Agreements with Class-Action Waivers
In an important victory for employers, on May 21, 2018 the United States Supreme Court ruled that employers may lawfully require employees to enter into arbitration agreements with class action waivers. The Court in Epic Systems v. Lewis struck down a series of decisions by the Obama-era National Labor Relations Board that prohibited employers from requiring employees to sign arbitration agreements containing class action waivers. The NLRB had held that employees taking part in class actions were engaged in “concerted activity” protected by the National Labor Relations Act. The high court disagreed, holding that the Federal Arbitration Act governed arbitration agreements and required that the agreements be enforced according to their terms. More>>
The California Supreme Court Severely Limits When It Is Appropriate To Classify A Worker As An Independent Contractor
On April 30, 2018, the California Supreme Court issued a landmark decision in the matter of Dynamex Operations W., Inc. v. Superior Court, No. S222732, 2018 WL 1999120 (Cal. Apr. 30, 2018), severely restricting when it is appropriate for an employer to classify a worker as an independent contractor for purposes of the California Wage Orders.
The Court adopted the “ABC” test, utilized in several other jurisdictions, as the appropriate test to determine whether a worker is an employee or an independent contractor. The “ABC” test clarifies the definition of “employ” (“to engage, suffer, or permit to work”) that is set forth in the California Wage Orders. More>>
New California Employment Bills Approved by the Governor
October 15, 2017 was the deadline for Governor Brown to decide whether to approve or veto several employment bills that were passed by the California Legislature in 2017. The laws signed by Governor Brown are summarized below and will become effective January 1, 2018.
AB 450 (Immigration Worksite Enforcement Actions):
AB 450 prohibits employers from allowing federal immigration enforcement agents to access non-public areas of the workspace without a judicial warrant or subpoena. It further requires employers to provide notice to employees when their I-9 or other employment records are inspected within 72 hours of the inspection. Penalties for violating these provisions of the new law are: $2,000-$5,000 for the first violation and $5,000-$10,000 for any subsequent violations. More>>
The California Supreme Court Clarifies Day of Rest Statutes
On May 8, 2017, the California Supreme Court issued its decision in Mendoza v. Nordstrom, Inc., No. S224611, 2017 WL 1833143 (Cal. May 8, 2017), clarifying California’s day of rest statutes (California Labor Code Sections 550-558.1), which prohibit an employer from “caus[ing] his employees to work more than six days in seven,” but do not apply “when the total hours of employment do not exceed 30 hours in any week or six hours in any day thereof.” The California Supreme Court answered three important questions.
(1) Is the day of rest calculated by workweek or does it apply on a rolling basis to any seven-consecutive-day period? More>>
City of Los Angeles Passes Ban The Box Ordinance
On November 30, 2016, the Los Angeles City Council passed the “Fair Chance Initiative,” also known as the “Ban the Box Initiative,” which prohibits employers that do business in Los Angeles from inquiring about or asking about a job applicant’s criminal history. The ordinance will go into effect on January 1, 2017.
An employer may only inquire about an applicant’s criminal history if the applicant is going to work in Los Angeles after offering the applicant a “conditional offer of employment.” After providing the applicant this conditional offer, the employer is prohibited from taking any adverse action, including withdrawal or cancellation of the applicant’s conditional offer, unless the employer performs a written assessment linking the applicant’s criminal history with the risks inherent in employing the applicant. More>>