US Supreme Court Splits the Baby on Arbitrability of PAGA Claims

By Megan S. Shaked and Samuel S. Rose

In the latest chapter in the enforceability of employment arbitration agreements in California, the United States Supreme Court in Viking River Cruises, Inc. v. Moriana (Viking River) weighed in on whether the Federal Arbitration Act (FAA) preempts California Supreme Court precedent set in Iskanian v. CLS Transportation (2014) preventing the enforceability of California Private Attorneys General Act (PAGA) waivers.

In Iskanian, the California Supreme Court held, in part, that the FAA does not preempt state law prohibiting waiver of PAGA representative actions in employment agreements.  Specifically, the California Supreme Court determined that “an arbitration agreement requiring an employee as a condition of employment to give up the right to bring representative PAGA actions in any forum is contrary to public policy.”

Now with the Viking decision, rather than treating a PAGA waiver as simply unenforceable in its entirety, the US Supreme Court, relying on a severability clause in the arbitration agreement at issue, decided that Continue reading

Challenges to California’s Corporate Board Diversity Laws Continue

A number of lawsuits challenging California’s corporate board diversity laws are still working their way through litigation, even years after the legislation went into effect.

Senate Bill 826

In 2018, California enacted Senate Bill 826, requiring California-based publicly held companies to have a minimum number of women on their boards of directors.  Such boards needed to have at least one female director by the end of 2019.  By the end of 2021, boards needed to have two female directors if the corporation has five directors and three female directors if the corporation has six or more directors.  A corporation out of compliance faces a $100,000 fine for the first violation and a $300,000 fine for a violation in any subsequent year. 

Assembly Bill 979

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Paid COVID-19 Supplemental Sick Leave Returns to California, Again

California Governor Newsom has signed legislation extending a new allotment of up to 80 hours of COVID-19 supplemental paid sick leave to California workers through new Labor Code Sections 248.6 and 248.7.  The leave is retroactive to January 1, 2022, and continues through September 30, 2022.  Small businesses that employ 25 or fewer workers are not covered by the legislation.   

Use of Sick Leave for Reasons Related to COVID-19

The legislation provides for up to 40 hours of COVID-19 supplemental paid sick leave for employees who are unable to work or telework for certain reasons related to COVID-19, including:

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Employment Law Implications of the OSHA ETS: Paying for COVID-19 Testing

By Conn Maciel Carey’s COVID-19 Taskforce

As the OSHA COVID-19 Vaccination and Testing emergency temporary standard (“ETS”) works its way through the courts in pending legal challenges, employers are still scrambling to position themselves in the event the ETS goes back into effect.  (Review our Employer Defense Report and OSHA Defense Report for full background on the ETS and the most recent updates on its current status.)  A key issue to consider is the cost of testing.

Background

Should the ETS go back into effect, employers with 100 or more employees must implement a program to facilitate (1) a COVID-19 vaccination requirement for all employees (known as a “hard mandate”) or (2) a combination of a COVID-19 vaccination requirement and weekly testing, plus face covering requirement, for those employees who choose not to get vaccinated (known as a “soft mandate”).  Under this soft-vaccine mandate, an employee may only report to the workplace after demonstrating either: proof of being fully vaccinated; or for employees who do not get vaccinated or decline to share their vaccination status, proof of a negative COVID-19 test result from within the last week.  Employees who are not fully vaccinated must also wear face coverings when indoors and when occupying a vehicle with another person for work purposes.

Under the ETS, a COVID-19 test must be: Continue reading

Battle Over Employment Arbitration Agreements In California Continues

By Megan Shaked

The seemingly never ending battle over employment arbitration agreements in California continues with last week’s Ninth Circuit court decision vacating a preliminary injunction over 2019’s California Assembly Bill 51 (previously discussed here and here).

Back in 2019, California Governor Gavin Newsom signed Assembly Bill 51, which added section 432.6 to the California Labor Code and sought to ban new mandatory arbitration agreements to the extent they cover any discrimination claims under the California Fair Employment and Housing Act (FEHA), or any claims under the California Labor Code.  Under this legislation, an applicant or employee could not, as a condition of employment, continued employment or the receipt of any employment-related benefit, be required to waive any right, forum, or procedure under the FEHA or any other specific statute governing employment.  Employers would also be prohibited from threatening, terminating or otherwise retaliating or discriminating against an applicant or employee because of the refusal to consent to a waiver.  Violations of these provisions would constitute unlawful employment practices under the FEHA and would be a misdemeanor.

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Will California’s COVID-19 Rehiring and Retention Requirements Outlive the Pandemic?

As we dream of a “post-COVID” world, some obligations stemming from the pandemic will certainly be with us for some time.  One such obligation for some employers to note is California’s rehiring and retention requirements.

California Senate Bill 93, which added Labor Code section 2810.8, brings statewide requirements for covered employers to offer available job positions to employees laid-off due to the COVID-19 pandemic.  Covered businesses include hotels, private clubs, event centers, airport hospitality operations, airport service providers, and those providing janitorial, building maintenance or security services to office, retail or other commercial buildings.  This section also applies even when an employer experiences certain ownership or organizational changes, for example, a change in ownership where the business is conducting the same or similar operations as before the COVID-19 state of emergency.

The law requires that, within 5 business days of establishing a position, a covered employer offer its employees laid off due to COVID-19 pandemic, in writing, “all job positions that become available [after its effective date] for which the laid off employees are qualified.”  Such qualification is determined based on the laid off employee holding the same or similar position at the time of the recent layoff.  If more than one employee is entitled to preference for a position, the employer must offer the position to the laid off employee with the greatest length of service on the employee’s date of hire.  The employee is afforded 5 business days to respond to the offer. 

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California’s CFRA Expansion Brings Increased Leave Rights

With the new year came a significant expansion of the California Family Rights Act (“CFRA”), which provides up to 12 weeks of unpaid, protected family and medical leave for certain employees. 

Under CFRA, specified employers are prohibited from refusing to grant certain leave requests by employees.  Employees granted a CFRA leave request must be guaranteed employment in the same or a comparable position upon termination of the leave.  CFRA also generally requires employers to maintain and pay for coverage under the employee’s group health plan for the duration of the leave at the level coverage would have been provided if the employee had continued working during the leave.

Under Senate Bill 1383, which went into effect January 1, 2021, private employers covered by CFRA now include any person who directly employs 5 or more employees.  Prior to this expansion, private employers covered by CFRA were only those with 50 or more employees. 

Qualifying Reasons For Leave

Qualified employees may be eligible for up to 12 workweeks of unpaid protected leave during any 12-month period:

1. for the birth of a child of the employee or placement of a child with an employee in connection with the adoption or foster care of the child by the employee;

2. for the employee’s own serious health condition that makes the employee unable to perform the functions of the position of that employee;

3. to care for certain family members who have a serious health condition;

4. due to a qualifying exigency related to the covered active duty or call to covered active duty of an employee’s spouse, domestic partner, child, or parent in the Armed Forces of the United States.

Covered family members used to include a spouse, domestic partner, parent, minor child, or dependent adult.  Now covered family members also include a child (not just minor child), grandparent, grandchild, and sibling.  Child, as defined, includes a biological, adopted, or foster child, a stepchild, a legal ward, a child of a domestic partner, or person to whom the employee stands in loco parentis.  This definition now includes adult children.  Parent, as defined, includes a biological, foster, or adoptive parent, a stepparent, a legal guardian, or other person who stood in loco parentis to the employee when the employee was a child.  A grandchild means a child of the employee’s child and a grandparent means a parent of the employee’s parent.  Sibling includes a person related to another person by blood, adoption, or affinity through a common legal or biological parent.

Given these expanded categories covered by CFRA, such leave may not always run concurrently with the Federal Family and Medical Leave Act (“FMLA”).  Employers will want to carefully track all leave requests to properly comply with both the CFRA and FMLA.

You may also recall that California recently expanded its baby-bonding leave to smaller employers.  Specifically, California’s 2018 New Parent Leave Act (“NPLA”), provided for 12 workweeks of unpaid protected baby-bonding leave for employees working at a worksite in which the employer employs at least 20 employees within 75 miles.  The protections of the NPLA are now included within CFRA, and the separate NPLA has been repealed.

Eligibility for Leave

CFRA still requires an employee to have at least 1,250 hours of service with the employer during the previous 12-month period in order to qualify for leave.

Significantly, employees no longer need to be among 50 employees within 75 miles to qualify for leave; there is now no geographic limitation to eligibility for CFRA leave, so long as the employer has 5 or more employees.

The CFRA expansion also eliminated the so-called “key employee” exception.  Specifically, there is no longer an exception from complying with CFRA for an employee who is a salaried employee and is among the highest paid 10% of the employer’s employees. 

Finally, there is no longer an ability to split the total leave among two parents when both parents of a child are employed by the same employer.  Now, the total amount of leave would need to be granted to each such parent.  Employers can no longer require parents split the leave in any way.

A Note About Pregnancy Leave

Although the CFRA expansion touches on leave for baby-bonding, the legislation specifies that existing pregnancy, childbirth, and related medical condition leave provisions are separate and distinct protections from CFRA protections.  By definition, use of CFRA leave to care for an employee’s own serious health condition does not include any leave taken for disability on account of pregnancy, childbirth, or related medical conditions.

Small Employer Family Leave Mediation Pilot Program

Under Government Code Section 12945.21, the California Department of Fair Employment and Housing (“DFEH”), the state agency that enforces CFRA, is tasked with creating a small employer family leave mediation pilot program for employers with between 5 and 19 employees.  Under the pilot program, an employer may, within 30 days of receipt of a right-to-sue notice alleging a violation of CFRA, request all parties to participate in the DFEH’s dispute resolution division.  The DFEH is supposed to include in a right-to-sue notice information about the right to participate in the mediation pilot program.  If an employer or employee requests such mediation, the employee cannot file suit under CFRA until the mediation is complete.  An employee’s statute of limitations, including for all related claims not under CFRA, are tolled upon receipt of a request to participate in the DFEH’s dispute resolution division until mediation is complete.  Section 12945.21 remains in effect until January 1, 2024.

Next Steps for Employers

Now is a good time to revisit your handbooks, leave policies and training to make sure your company’s policies and procedures comply with the expanded CFRA requirements.  The DFEH has added updated facts sheets, required posters, and other leave-related information on its website.  We will also keep an eye on the CFRA regulations in effect.  Employers with questions about how to comply with the new requirements or how to navigate tricky leave questions are encouraged to consult with employment counsel.

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What Do State and Local Stay-At-Home/Shelter-In-Place Orders Mean For Employers?

By Conn Maciel Carey’s COVID-19 Task Force

COVIDGovernors across the nation have signed various “stay-at-home” or “shelter-in-place” orders in an increased effort to slow the spread of COVID-19.  Many cities and counties have also signed such orders as well, including in states with no statewide order in place.  These orders vary in their scope in the restricted activities and affected industries but they typically address: (1) the continued operations of critical businesses; (2) restrictions on non-essential businesses; (3) the activities individuals may continue to perform; and (4) other limitations on gatherings.

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Challenges to New California Independent Contractor Law and Ban on Mandatory Arbitration Agreements Wind Through the Courts

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As expected, there have been a number of legal challenges to California Assembly Bills 5 and 51, both of which were signed into law by California Governor Gavin Newsom and set to go into effect on January 1 of this year.

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2020 Legislative Update for California Employers

California flagBy Andrew J. Sommer and Megan S. Shaked

Following the 2018 legislative session, which was dominated by laws responding to the #MeToo movement, 2019 has produced a long list of new employment laws on a myriad of topics.  From a new test for determining independent contractor status to a ban on no rehire agreements and revamped reporting standard for serious workplace injuries and illnesses, 2020 brings significant changes for California employers.  Though many of these laws will add items to the HR to-do list, employers have at least secured a one-year reprieve for completing mandatory harassment prevention training introduced last year.

Key changes affecting private sector employers are summarized below.  Unless otherwise indicated, these new laws take effect January 1, 2020.

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