Posted on January 6th, 2016
I hate to tell you something you already know, but WOW California is a tough place to be an employer!
As if there are not already too many restrictive laws and regulations related to employees, the start of each new year brings even more restrictions and constraints on employers, entrepreneurs, business owners who drive this states economy.
So what can you do? Well, for starters, make sure you keep up with the latest news that could affect your California business.
2016 brings new employment laws, some of which will make significant changes to existing California laws.
Below is a quick cheat sheet ‘The 2016 California Employment Laws You Need to Know‘. These are the new laws we think will have the biggest impact on California employers.
Fair Pay Act
This law compels employers to pay equal wage rate to employees of every gender. This new law is strictest in the country and becomes effective January 1, 2016.
It was put in place to address the issue of inequality between women and their male counterparts in the same or similar position. Of course, women should be paid an equal wage for the same position/work.
The problem with the law is not that it requires fair wages, but that it puts the burden of proof on the employer to PROVE the reason for any disparity in pay, whether it is because of seniority, skill or some other lawful reason. I predict lots of lawsuits on this topic in 2016 and beyond.
Even if the employer has a lawful and legitimate reason for the disparity in pay, how much will it cost in legal fees to prove the legitimacy of any pay disparity?
Will it be easier and more cost effective just to pay off unscrupulous attorneys to go away?
When will California address this real and major problem that is driving off business in California in droves?
The new law also makes it illegal to retaliate against employees who talk about their pay at work. This gives employees the right (in fact seems to encourage) employees to discuss their pay.
As you can imagine this is expected to open up whole new levels of liabilities for employers as some employees (and unscrupulous attorneys) will “fish” for gender discrimination claims in their compensation. While traditionally its been taboo to ask co-workers about pay this will likely create problems where none may exist.
If you suspect you are paying employees of the opposite sex lower wage rates while doing substantially similar work, you need to evaluate immediately! Make sure you have substantial and legitimate reasons for any pay gaps between male and female workers or get ready to level up the salaries.
Remember the new law went into effect January 1st 2016 so make sure you start doing salary reviews now.
You have a very limited options to justify discrepancies in wages for employees with substantially similar work, and those do not include gender. Here is an article we wrote earlier that has more information on the California new Fair Pay Act and its provisions.
Amendments to California’s Anti-retaliation Protections
New amendments to anti-retaliation laws further make it easier for employees to make a claim of retaliation against employers. Employers can now be accused of adverse employment action against an employee who is a family member of a person engaged in a protected activity.
The previous laws protected employees who engaged in protected activities such as resisting or objecting to discrimination or harassment, including filing a complaint, testifying or assisting in any proceeding during a case of harassment or discrimination.
The new law has been expanded to protect an employee who is a family member of a person who engaged in a protected activity.
Judgment Enforcement by Labor Commissioner
The new year also brings significantly enhanced authority on behalf of the Labor Commissioner to enforce judgement for unpaid wages under the California Fair Pay Act.
Employers are at risk of facing individual, civil and criminal liability if they fail to follow all the California labor laws, including the ones established by the Fair Pay Act, effective January 1, 2016.
The Labor Commissioner now has the power to issue a stop work order against an employer if an employer has a judgement for non payment of wages. If an employer fails to pay on a final judgement, the Labor Commissioner can now force companies to cease operating.
Wow! How does an employer pay a judgment if they can’t operate their business? Who are these people that think these are good laws?
This new law also punishes owners, officers, directors or managing agents who act on behalf of the employer and imputes personal and criminal liability if there are labor code violations.
Employee Time Off
If you have more than 25 employees in your company, you must allow your employees who are parents, guardians, foster parent or grandparents who have custody of a child in a child care facility, kindergarten or attending 1 to 12 grades at school, to use up to 40 hours of unpaid time off each year to attend or participate in the child’s school activities.
This law already existed but in 2016 its been expanded to include not only blood relatives but people who are caring for a child (step parent, foster, etc…)
Also, all employers, big or small, must allow employees to use one half of their accrued sick leave to care for a family member. This law defines “family member” as a child of any age ( biological, adopted, foster, stepchild); a parent (biological, step, foster, in-law); spouse, registered domestic partner, grandchild or siblings.
Under this law, employers are prohibited to act against an employee or to deny the employee the use of sick leave for the reasons above. This law is effective January 1, 2016. (I actually find this one to be fairly reasonable.)
IN CLOSING…
California is without a doubt the toughest state to be an employer. Each year California piles on additional one sided laws that make it increasingly more difficult to earn a profit and creates new angles for unscrupulous lawyers to try to take what you have earned.
It is extremely important that you review and update your employee policies and handbooks each and every year so you are covered for all these new provisions they put in place.