HILL, FARRER & BURRILL LLP

Labor & Employment Update

SB 699: New California Law Further Restricting The Use of Non-Competes

September 12, 2023

By Elissa L. Gysi and Shelby Y. Meskin

Governor Gavin Newsom recently signed Senate Bill (SB) 699 into law which further restricts the use of non-compete clauses in employment agreements in California.  The law goes into effect on January 1, 2024.

Most non-compete agreements have long been unenforceable in California under Section 16600 of the California Business and Professions Code (“every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void”). More>>

LOS ANGELES, Aug. 22, 2023 /PRNewswire/ — Hill, Farrer & Burrill LLP announced today that Partners Robert Eroen and Kevin Brogan have been recognized by Best Lawyers in the 30th edition of The Best Lawyers in America. Best Lawyers awards are compiled “by conducting exhaustive peer-review surveys in which tens of thousands of leading lawyers confidentially evaluate their professional peers” and honor “only the top 5.3% of elite lawyers in the nation across 150 practice areas.”

“Ranking the most exceptional legal minds requires sustained commitment and considerable intricacy. We leave no stone unturned, ensuring that that each stage of the Best Lawyers awards cycle is thorough,” states the periodical. More>>

The National Labor Relations Board (“NLRB”) is cracking down on employers who have employee handbooks or policies that might be interpreted by employees to restrict their right to complain about wages, hours, working conditions or to communicate with union representatives.

On August 2, 2023, the NLRB issued its decision in Stericycle Inc., 372 NLRB No. 113 (2023) which adopted a new standard to determine whether employer handbook provisions unlawfully restrict employees’ exercise of protected concerted activity under Section 7 of the National Labor Relations Act.  The new standard changes the NLRB’s previous approach which balanced a challenged rule’s potential impact on NLRA rights against an employer’s legitimate justifications for maintaining the rule. More>>

In the long-awaited Adolph v. Uber Technologies case, the California Supreme Court unanimously held that an order requiring an employee to arbitrate his individual Private Attorneys General Act of 2004 (“PAGA”) claim does not deprive the employee of standing to litigate non-individual PAGA claims on behalf of other employees.

The Court’s Decision:

The question before the California Supreme Court was whether an aggrieved employee who has been compelled to arbitrate his individual PAGA claims maintained standing to pursue his non-individual PAGA claims arising out of events involving other employees in court or in any other forum.  Justice Liu wrote for the Court, “[W]here a plaintiff has filed a PAGA action comprised of individual and non-individual claims, an order compelling arbitration of individual claims does not strip the plaintiff of standing to litigate non-individual claims in court.” More>>

LOS ANGELES – July 12, 2023 – Hill, Farrer & Burrill LLP announced today that Chase Bakaly and Erika Silverman have been listed in the first Lawdragon 500 X – The Next Generation guide. This seminal guide honors the burgeoning legal talent infusing traditional and innovative practices with fresh energy and forward-thinking perspectives.

“This is our inaugural guide dedicated to those who will define where the legal profession of our country goes. Whose leadership will be called upon by businesses and individuals when they face their crossroads,” states the publisher. “After reviewing thousands of candidates for what we informally call LDX500, we’re confident the future is in good hands.” More>>

LOS ANGELES – June 28, 2023 – Hill, Farrer & Burrill LLP announced today that the firm has been recognized in the Los Angeles Times as a “Top Law Firm” in Los Angeles County.

The list is ranked by the number of attorneys in Los Angeles County offices. Additionally, the firm’s Real Estate and Labor & Employment practices are also listed in the top 25 of firms that practice in the same areas.

“It is an honor to our professionals for the firm to be recognized alongside some of the most impactful law firms in Los Angeles,” said Managing Attorney Dean E. More>>

LOS ANGELES – June 28, 2023 – Hill, Farrer & Burrill LLP announced that Partner Elissa Gysi has been selected as an honoree in a Los Angeles Business Journal recognizing the city’s most influential women attorneys. The “Women of Influence: Attorneys” list recognizes women lawyers that have been recognized for exceptional legal skill and achievement and for contributions to the Los Angeles business community at large.

“This recognition is a testament to Elissa’s legal prowess and her dedication to clients,” says Managing Attorney Dean E. Dennis. “She is tireless in her commitment to provide clients with the highest degree of strategy and service.” More>>

In Hill Farrer’s October 11, 2022 employment update, we discussed Senate Bill (SB) 1162, which was signed into law on September 27, 2022 and expanded employers’ pay data reporting requirements.  This serves as a reminder of the upcoming deadline of May 10 2023 for private employers with 100 or more employees to submit 2022 pay data reports to the California Civil Rights Department that comply with this new law.

While employers should be familiar with the existing law that requires employers to submit pay data reports, SB 1162 modifies and expands employers’ obligations relating to pay data reporting.  Specifically, SB 1162 made the following changes to the pay data reporting laws:

• Whereas the previous law required employers to file annual pay data reports with the number of employees by race, ethnicity, and sex in specific job categories, SB 1162 now requires employers to also include the median and mean hourly rate for each combination of race, ethnicity, and sex within each job category.

Below is a summary of several important new laws that impact California employers.

Pay Data Reporting and Pay Scale Transparency (SB 1162)

On September 27, 2022, Governor Newsom signed Senate Bill (SB) 1162 into law.  SB 1162, which will become effective January 1, 2023, (1) broadens the information employers must include in their pay data reports to the California Civil Rights Department, and (2) expands the pay scale information employers must disclose to both current and prospective employees.

Pay Data Reports:

Prior to SB 1162, California required private employers with 100 or more employees to file an annual “pay data report” to the California Civil Rights Department (formerly the DFEH) that included the number of employees by race, ethnicity, and sex in specified job categories.  More>>