E-Communicator Article


New 2016 Laws Affecting California Employers

By: CalChamber Employment Law Counsel

California enacted many new laws that will affect the day-to-day operations of California businesses in 2016.

Some of the new laws make important changes to existing state law. Other new laws make small changes to different parts of existing law or may only affect certain types of employers.

Also, don’t forget that the minimum wage increases on January 1, 2016, to $10 per hour. This is not a new law (It was signed in 2013.), but this is the last mandatory increase from that law.

Unless specified, all new legislation goes into effect on January 1, 2016.

Several new laws affect leaves of absence.

Mandatory Paid Sick Leave Amendments
Last year, the Healthy Workplaces, Healthy Families Act was signed into law and required employers to begin providing the mandatory paid sick leave (PSL) benefit beginning July 1, 2015. But after the law was already in effect, the Legislature passed AB 304, which made several substantial amendments to the law. The amendments became effective on July 13, 2015.
        Among other things, the amendments:

  • Clarify who is a covered worker;
  • Provide alternative accrual methods other than one hour for every 30 hours worked;
  • Clarify protections for employers that already provided PSL or paid time off before January 1, 2015 (a grandfather clause); and
  • Provide alternative methods for paying employees who use PSL.

School Activities Leave
SB 579 expands the ability of employees to take protected time off from work for school or child care related activities. It allows an employee protected time off to find a school or a licensed child care provider and to enroll or re-enroll a child, and time off to address child care provider or school emergencies. SB 579 also expands the categories of employees eligible to take time off for a child. This law applies to employers with 25 or more employees.

Kin Care
SB 579 makes technical amendments to California’s “kin care” law to conform to the mandatory PSL law. SB 579 allows employees to use kin care for the same purposes specified by the PSL law and defines “family member” under the kin care law the same as under PSL.

Unemployment Insurance and Electronic Reporting
AB 1245 requires electronic reporting for unemployment insurance reports submitted to the Employment Development Department. It also requires employers to remit contributions for unemployment insurance premiums by electronic funds transfer. The requirements will apply to employers with 10 or more employees beginning January 1, 2017, and to all employers beginning January 1, 2018.

State Disability Insurance Eligibility: Waiting Periods
SB 667 changes the eligibility waiting period requirements when an individual files a second disability claim for the same or related condition as his/her initial claim. SB 667 also extends the time between claims that will be considered one disability benefit period. This law is effective July 1, 2016.

Unemployment Insurance: Training Benefits
AB 1514 makes changes related to eligibility for unemployment insurance benefits during a period when the individual is taking specified training or retraining.

Several new laws expand employee protections for 2016.

Gender Wage Equality
Under existing California law, employers cannot pay an employee less than the rate paid to an opposite-sex employee in the same establishment for equal work on jobs that require equal skill, effort and responsibility, and could face a lawsuit for such disparity.

SB 358 (The Fair Pay Act) prohibits an employer from paying any of its employees less than employees of the opposite sex for “substantially similar work, when viewed as a composite of skill, effort and responsibility.” In addition, the legislation places specific requirements on employers to affirmatively show that any wage differential is not unlawful but is instead based entirely and reasonably upon one or more of the acceptable listed factors, including seniority and merit systems or other bona fide factors coupled with a showing of “business necessity,” as defined.

Several new laws will increase employers’ wage-and-hour obligations in 2016.

Wage Garnishment
SB 501 reduces the prohibited amount of weekly disposable earnings that may be garnished pursuant to a withholding order. This amendment is effective July 1, 2016.

Misclassification Amnesty for Motor Carrier Employers
AB 621 establishes the Motor Carrier Employer Amnesty Program for port transportation companies (also known as port of drayage companies). The amnesty program allows motor carrier companies to avoid liability for misclassification of drivers as independent contractors if the companies voluntarily enter into settlement agreements with the Labor Commissioner by January 1, 2017.

Several bills relating to workers’ compensation were signed into law in 2015:

  • AB 1124: Requires the Division of Workers’ Compensation to establish a formulary for prescription medications in the workers’ compensation system by July 1, 2017.
  • SB 623: Ensures that all injured workers receive benefits by clarifying that workers cannot be denied benefits based on citizenship or immigration status.
  • AB 438: Requires specified workers’ compensation forms, notices and fact sheets to be made available in additional languages by January 1, 2018.
  • SB 542: Makes clarifications to medical provider network laws, including requirements about the information a medical provider network must post on its website.
  • SB 560: Allows the Contractors State License Board to investigate and enforce the obligation of licensees to secure valid and current workers’ compensation insurance.

To see the complete list of 2016 employer laws, please visit www.calchamber.com.

New 2016 Laws Affecting California Employers

- CMSA Communicator

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