New Laws Effective January 1, 2018

October 23, 2017

This past week, Governor Brown signed into law several more employee-friendly bills.  Unfortunately, none of the bills are helpful for California employers.  Here are the new laws effective January 1, 2018.

AB 1008 (Ban the Box):  Effective January 1, 2018, this new law amends the California Fair Employment and Housing Act to prohibit employers with 5 or more employees from inquiring about criminal history on an employment application and/or at any time (including the interview process) prior to making a conditional offer of employment.  This law also requires an employer who intends to deny an applicant a position of employment solely or in part because of the applicant’s conviction history to make an individualized assessment of whether the applicant’s conviction history has a direct and adverse relationship with the specific duties of the job sought, considering the nature and gravity of the offense, the amount of time that has passed, and the nature and duties of the job sought by the applicant.  An employer who makes a preliminary decision to deny employment based on that individualized assessment must provide the applicant a written notification of the preliminary decision that identifies the disqualifying conviction(s) and informs the applicant that he or she may provide a response that includes evidence challenging the accuracy of the conviction information and/or demonstrating rehabilitation or other mitigating circumstances. The employer also must provide a copy of the conviction history report, if any. (The employer may, but is not required to, explain or justify the reasoning for its preliminary decision.)  The applicant must be provided with at least 5 business days to respond (before the employer can make a final decision on employment).  If the applicant notifies the employer in writing that he or she disputes the accuracy of the conviction history and is obtaining evidence to support that assertion, the applicant must be given an additional 5 business days to respond to the notice.  The employer is required to consider any information submitted by the applicant before making a final decision.  If a final decision is made to deny employment, the employer again must provide written notification to the applicant and inform the applicant of his or her right to file a complaint with the Department of Fair Employment and Housing and/or of any internal appeal rights the applicant may have to challenge the decision.  (Again, the employer may, but is not required to, explain its justification/reasoning for its final decision.)  This new law does not apply in those limited circumstances where a public or private employer is required by law to conduct a criminal background check or to restrict employment based on criminal history.  Covered California employers should familiarize themselves with the requirements of this new law and modify their employment applications and hiring processes accordingly

AB 1701 (Contractor Liability/Wages):  This new law provides that for contracts entered into on or after January 1, 2018, a direct contractor making or taking a contract in the state for the erection, construction, alteration, or repair of a building, structure, or other private work, shall assume, and is liable for, any debt owed to a wage claimant or third party on the wage claimant’s behalf, incurred by a subcontractor at any tier acting under, by, or for the direct contractor for the wage claimant’s performance of labor included in the subject of the contract between the direct contractor and the owner.  The direct contractor’s liability extends only to any unpaid wage, fringe or other benefit payment or contribution, including interest owed, but does not extend to penalties or liquidated damages.  The Labor Commissioner or a wage claimant may bring a civil action against a direct contractor to collect wages owed.

AB 46 (Gender Pay Equality):  This new law simply provides that California’s Equal Pay Act applies to public employers just as it applies to private employers.

SB 396 (Expansion of Harassment Training):  California’s Fair Employment and Housing Act already requires employers with 50 or more employees to provide at least 2 hours of prescribed training and education regarding sexual harassment to all supervisory employees within 6 months of their assumption of a supervisory position and once every 2 years thereafter.  Effective January 1, 2018, this new law requires covered employers to include information on harassment based on gender identity, gender expression, and sexual orientation as a component of that prescribed training. Employers also have to publish new/amended posters (to be developed by the Department of Fair Employment and Housing) on the subjects of harassment and transgender rights.

AB 168 (Salary Inquiries):  This new law, effective January 1, 2018, adds section 432.3 to the Labor Code and prohibits employers (public and private) from inquiring about, or considering, information concerning an applicant’s prior salary history in determining whether to offer employment to the applicant and/or the amount to pay the applicant.  It also requires employers to provide the pay scale for a position upon request by an applicant.  An applicant may, however, voluntarily (without prompting by the employer) disclose information concerning prior salary history, in which case the employer may consider it in determining the employee’s compensation.  This new law is intended to combat the continuation of historical pay gaps existing along gender and/or racial lines.

SB 63 (Expansion of Parental Leave Rights):  This new law, effective January 1, 2018, adds section 12945.6 to the Government Code and provides that an employee who has at least 12 months of service and 1250 hours of service within the prior 12 months, and who works at a worksite in which the employer employs at least 20 employees within 75 miles, is entitled to take up to 12 weeks of parental leave to bond with a new child within one year of the child’s birth, adoption, or foster care placement.  The employer also is required to maintain the employee’s group health coverage during such leave, on the same terms as if the employee was actively reporting to work.  There are already state and federal statutes requiring larger employers (50 or more employees) to provide such leave, but this new law creates parental leave rights for employees of smaller employers.  If an employee is already entitled to leave under the FMLA or CFRA, this new law does not grant the employee another 12-week bucket of time off to also use.

California employers will need to modify their policies and practices as necessary in light of these new laws, including by reviewing and revising employment applications that contain salary history fields and revising or creating a parental leave policy that reflects an employee’s entitlement to take parental leave under the expanded eligibility conditions set forth in the new parental leave law.

 

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What to do if an Employee Passes Away on or off the Job!

October 16, 2017

It is news an employer never wants to deliver. But it happens. In fact, according to OSHA it’s happened 357 times already this year. We occasionally get these sad call or that an employee has passed away and what should be done with the final check. First things first. The language to use may vary but here is at least one suggestion that should be used by the employer representative. “I’m sorry, but your spouse (or partner, child, or other family member) had an accident at work and unfortunately passed away.” Here are 9 suggested steps to follow that I pulled off the internet:

  1. Call 911, ASAP. There is never a reason to wait to inform the authorities, period.
  2. Immediately thereafter, notify the employee’s emergency contact person, preferably in person. This news should not be delivered over the phone if at all possible. If you must deliver the news via a phone call, arrange for a company representative to meet the family, likely at the hospital.
  3. If the death is work-related, contact your nearest OSHA Area Office, or OSHA’s national 24-hour hotline at 1-800-321-OSHA. All fatalities must be reported to OSHA within 8 hours.
  4. Notify executives and HR, and other employees with a need to know what happened.
  5. Notify your remaining employees of the fact of the fatality, and let them know that details will follow.
  6. Follow your internal procedures for contact with the media. If you do not have any such internal procedures, or if you are not comfortable with anyone in your organization facing the media, engage a public relations firm, as soon as possible. You will need someone to say something. “No comment” is not a good statement under these circumstances; it will look like you’re hiding something.
  7. Show extreme sensitivity to the family of the deceased. Who do they want to be their contact person? Who will disseminate funeral arrangements and how? What are the family’s wishes regarding flowers, donations, calling, visitations, and other contact? How and when does the family want to handle necessary employment issues (medical benefits, life insurance, workers’
  8. Designate one internal contact person to disseminate information to employees, and for employees to ask any questions. Unless the family directs otherwise, instruct employees not to contact the family.
  9. Arrange for grief counseling or other mental-health services for those employees who witnessed the accident, or are otherwise impacted.

The second issue surrounds what to do with the final check. This is a legal issue, not a sympathetic issue. The final check has to be given to the heir of the estate and that is determined through a probate proceeding not by a relative who calls up and directs you to mail the check to them. It is recommended that you inform the person demanding the check that you can only send the check to whomever the court determines is the rightful person to receive it and once you receive the proper documents you will issue the check accordingly. This is a suggestion but you may deem otherwise especially if you have knowledge as to who the heir(s) may be. Just keep in mind if you are incorrect and the real heir is determined to be someone other than who you issued the check to, they may come after you to retrieve what was rightfully due to them.


The Right Way to Conduct Performance Appraisals!

October 9, 2017

Many companies have a 90-day “probationary period” for new hires. At the end of this, the manager is supposed to do a sit-down evaluation with the new employee. It’s such a standard thing that we often don’t think about it, but we should. It’s actually an area which can cause your business big trouble if you don’t do it right. Here’s the right way to conduct a 90-day performance appraisal.

Stop Saying “Probationary Period.”

This is not just a language thing–it’s a legal thing. In the United States (with the exception of Montana), all employees are at-will (unless they have a contract or are in a union). You do not want to do anything to jeopardize the at-will status. So, stop referring to the first 90 days as a probationary period because it implies that the rules change at day 91. If you can be fired without notice on day 75, does the end of the probationary period mean something’s changed and now you can only be fired for cause? You don’t want to get in the legal battle over that. Just say, “We’re going to do a review at 90 days.”

Aim for 90 Days.

We don’t call it a 90-day review for nothing. The 90 days isn’t critical. You could do a 60-day review, a 120-day review, or a 75.5-day review. The critical part is to do it when you’ve told the employee you will. Put it on the calendar on your new hire’s first day.

Have an Agenda.

If you sit down and say, “So, how are things going?” you’re going to miss important things. You can certainly have that type of conversation, but not at an official review. A review should have, at a minimum, an agenda. If this is official company policy, there should be a form.

You want to stick to the agenda and cover these things (plus whatever is important for the particular position):

  • Areas where the new hire needs additional training
  • Cultural fit
  • Gaps in knowledge
  • Workload evaluation
  • Skills fit
  • The employee’s observations
  • Things that need changing
  • Things that are working well

Make Sure the Employee Has a Chance to Speak.

This is not just about you giving feedback, it’s about you receiving feedback. What is and what is not working? Are there improvements that your new hire wants to make? Are there concerns you should know about? It’s better to learn about these things now than have problems appear later on.

Remind the New Employee About Policies.

Most people aren’t going to take a day off in their first few months, so they may have forgotten the proper procedures to request time off. The new employee may not have submitted an expense report or had to buy plane tickets for travel, but she will in the future. It’s a good time to go over these things.

And if the 90 Days Were a Failure?

If it was a total failure, then that should not be a surprise to anyone at the review. If you’ve been attempting to fix the problems for the past 90 days, it’s time to let the employee go. However, if it was a disaster because you didn’t provide training and support, you need to fix that. Bringing in someone new won’t fix the company’s onboarding process.

But if the employee is definitely the issue, it’s better to part ways sooner rather than later. Get the paperwork in order and get everyone to sign off and bid the person good luck in their future endeavors.

The above really does represent simple steps to follow and helps in the documentation process should things go wrong. This process can be used for all performance appraisals.

A final point. Introductory periods can be extended IF you think it might help but don’t just keep extending it to give the person another opportunity. If they cannot get it done after two opportunities chances are they are not going to make it.


Court Rejects Extended Medical Leaves of Absence as ADA Accommodation

October 2, 2017

At last a favorable decision on extending leaves of absences. In Severson v. Heartland Woodcraft, Inc., an employer terminated an employee unable to return to work after the expiration of his 12-week FMLA leave. The employee requested an additional two or three months of unpaid leave as a reasonable accommodation under the ADA to recover from back surgery (a position endorsed by the EEOC). The employer refused the accommodation request and terminated the employee. The 7th Circuit Court of Appeals held that the employer acted well within its legal rights under the ADA, because an extended unpaid medical leave is not an ADA-approved reasonable accommodation. According to the Court:

[A] long-term leave of absence cannot be a reasonable accommodation. … Simply put, an extended leave of absence does not give a disabled individual the means to work; it excuses his not working. … Intermittent time off or a short leave of absence—say, a couple of days or even a couple of weeks—may, in appropriate circumstances, be analogous to a part-time or modified work schedule, two of the examples listed in [the ADA]. But a medical leave spanning multiple months does not permit the employee to perform the essential functions of his job. To the contrary, the inability to work for a multi-month period removes a person from the class protected by the ADA.

Without a doubt, this case is a huge win for employers, which grapple daily with the issue of employee medical leaves and the difficulties they present in staffing, scheduling, and overall attendance rules. It’s not all rosy for employers. This holding stands in direct contrast to the position of the EEOC—that an employer must consider providing unpaid leave to an employee with a disability as a reasonable accommodation if the employee requires it, and so long as it does not create an undue hardship for the employer. For this reason, Severson notwithstanding, employers act at their peril if they deny an unpaid leave of absence without engaging in the interactive process with an employee and without establishing an undue hardship. Until the Supreme Court weighs in on this issue, I recommend employers proceed practically and tread lightly around these issues. Consider the following approach to handling employee requests for extended unpaid medical leaves.

Avoid leave policies that provide a per se maximum amount of leave, after which time an employee loses his or her job.

Engage in the interactive process with an employee who needs an extended leave of absence, which includes the gathering of sufficient medical information and a definitive return to work date documented by a medical professional.

Involve your employment counsel to aid in the process of deciding when an extended leave crosses the line from a reasonable accommodation to an undue hardship.

Open your workplace to disabled employees to demonstrate to the EEOC, if necessary, that you take your ADA obligations seriously.

You should document all costs associated with any extended unpaid leaves (modified schedules, added overtime, temporary hires, lost productivity, etc.) to help make your undue hardship argument, if needed.

Otherwise, you risk potentially unnecessary, and most definitely costly, litigation.