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New 2017 CA Employment Laws

Thomas M. Lee

Get Ready for the new 2017 California Employment Laws!

Governor Brown has just signed several important measures that bring new changes to California’s employment laws, most of which will take effect on January 1, 2017. Here are some of the highlights:

1) Increased Paid Family Leave and State Disability Benefits:

Effective January 1, 2018, state Paid Family Leave (PFL) and State Disability Insurance (SDI) wage-replacement benefits will increase to 60 or 70 percent of a participant’s wages (from the current level of 55 percent), depending on income level and up to the statutory cap. In addition, the current seven-day waiting period for PFL benefits will be eliminated as of January 1, 2018. PFL benefits, which are wholly funded by employee contributions, provide up to six weeks of wage-replacement benefits for bonding with a new child or to care for an ill family member.

2) Background Checks by “Transportation Network Companies”:

In seeking to protect the users of transportation network companies, such as Uber or Lyft, the companies will be required to conduct or have a third party conduct local and national criminal background checks on their drivers. Moreover, sex offenders and other persons convicted of certain violent felonies or misdemeanors, such as assault or battery, domestic violence, or driving under the influence will be barred from participating as drivers.

3) Salary History:

In January 2016, the California Fair Pay Act became law, creating new gender pay equity protections under Labor Code section 1197.5. This bill expands the Fair Pay Act to specify that an individual’s prior salary cannot, by itself, justify a wage differential.

4) Juvenile Criminal History:

Employers will be prohibited from asking an applicant to disclose juvenile convictions. However, there will be an exception for employers at a health facility to permit inquiry into an applicant’s juvenile criminal background if it is relating to certain sex or controlled substances crimes within five years preceding the employment application.

5) Notice of Domestic Violence Leave and Accommodation Rights

Employers will be required to provide written notice to new employees, and to current employees upon request, of the time off and accommodation rights under Labor Code sections 230 and 230.1 protecting victims of domestic violence, sexual assault, and stalking. The Labor Commissioner, no later than July 1, 2017, must develop a model notice that employers can use, and employers will not be required to comply until this sample is available.

6) Wage Statements (Paystubs) for Exempt Employees:

Itemized wage statement for certain exempt employees need not show the employee’s “total hours worked.” This new law is applicable to employees who fall under the executive, managerial, professional, outside sales, or computer software professional so long as they are paid on a fixed salary.

7) Unfair Immigration-related Practices:

A newly added Labor Code section 1019.1 will make it an “unfair immigration-related practice” to: (1) request more or different documents than required under federal law to verify work authorization; (2) refuse to honor documents tendered that on their face reasonably appear to be genuine; (3) refuse to honor documents or work authorization based on the specific status or term that accompanies the authorization to work; or (4) attempt to reinvestigate or re-verify an incumbent employee’s work authorization using an unfair immigration-related practice. Individuals who suffer an unfair immigration-related practice can file a complaint with the DLSE for enforcement, and violations carry a penalty of up to $10,000.

8) Equal Pay Based on Race and Ethnicity:

The Wage and Equality Act extends California’s Fair Pay Act protections in Labor Code section 1197.5 to cover race and ethnicity, such that it will now be unlawful to pay employees less than employees of another race or ethnicity for “substantially similar work.” This is perhaps one the most contraversial laws in that it potentially infringes on employee privacy rights and could be difficult to enforce.

9) Choice of Law and Forum in Employment Contracts:

New Labor Code section 925 will prohibit employers from requiring that an employee who lives and works in California agree, as a condition of employment, to a provision that would: (1) require the employee to litigate or arbitrate outside of California claims that arise in California; or (2) deprive the employee of the protection of California law with respect to a controversy arising in California. A contract that violates these restrictions is voidable at the employee’s request, and the matter would be adjudicated in California under California law. The law applies to contracts entered into, modified, or extended on or after January 1, 2017. However, it does not apply where the employee is individually represented by legal counsel in negotiating the terms of an agreement with respect to choice of law or forum.

Please note that the information we are providing here in our website is not meant to create an attorney-client relationship nor is it to be relied on as legal advice. For a free legal consultation by phone with attorney Thomas M. Lee, please call us or send us an email.

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