New California Employment Laws For 2013

Effective January 1, 2013, an unusually large number of new employment laws will affect private employers with employees working in California. Several of these new laws require immediate attention from most employers. Heading into the end of 2012 is a good time for employers to make sure that their policies and practices are compliant with California's evolving employment laws and regulations.

Below are highlights of some of the upcoming changes and actions companies should take. Click here to read the full article.

Pregnancy-Related Issues

• On Friday, November 30, 2012, 28 pages of new pregnancy regulations were approved by the Office of Administrative Law. They become effective December 30, 2012, and will affect virtually every California employer. While some of the amendments are technical and simply update certain terms in the existing regulations, other changes are significant. California employers are encouraged to familiarize themselves with these significant new regulations before year-end and to ensure strict compliance with respect to all employees “affected by pregnancy.”

Compensation Issues

• A new Labor Code provision will require that all in-state and out-of-state employers paying commissions to employees working in California provide them with written "contracts" setting forth both the formula for calculating commissions as well as the method of payment. Employers should review variable compensation plans to determine if they qualify as commission plans and, if so, begin preparing written commission agreements to be effective no later than January 1, 2013.
• Some employers have a practice of paying nonexempt employees a fixed or guaranteed salary which includes all overtime hours worked (e.g., a fixed amount for all hours worked up to 50 in a week). AB 2103 amends section 515 of the Labor Code to specifically forbid this practice. Employers must ensure that all nonexempt employees, salaried or hourly, keep accurate time records of hours worked and meal periods taken and receive hourly overtime pay for any overtime hours.
• Employers are required to provide at least nine categories of specified information to employees on every wage statement each time wages are paid to an employee. A mistake here can cost employers $4,000 per employee.

Social Media Issues

• Employees' increasing use of electronic communication and social media has created new challenges for employers and, effective January 1, 2013, a new California law, AB 1844, adds provisions to the California Labor Code which prohibit California employers from requiring or requesting current employees or job applicants to: (i) disclose their username or password so the employer can access their personal "social media;" (ii) access their personal "social media" in front of the employer; or (iii) divulge their personal "social media" to the employer. The new law considers an employee's or applicant's personal e-mail and text messages as "social media."
• Employers should also be mindful that the National Labor Relations Board (NLRB) has issued several rulings invalidating social media policies that might be read to impermissibly interfere with employees' rights to engage in protected concerted activity under the National Labor Relations Act (NLRA).

Record Keeping Issues 

• Current law requires that every employer provide at the time of each payment of wages to each employee an accurate itemized statement showing certain specified information. Employers are required to retain a copy of the statement and the record of deductions on file for three years. AB 2674 also allows employees to inspect certain of their personnel records. If an employer fails to comply with inspection and copying requests, either the current/former employee or Labor Commissioner may collect a penalty of $750.
• In the past year, the NLRB has taken a position on "at-will" provisions in employee handbooks, finding that some standard provisions violate the National Labor Relations Act. Due to the NLRB's increased scrutiny in this area, employers should update the at-will provisions in their employment documents (applications, offer letters, employee handbooks, and employment contracts).
• The newly created Consumer Financial Protection Bureau recently issued regulations modifying the notices required under the Fair Credit Reporting Act (FCRA). The changes affect three forms: the Summary of Consumer Rights under FCRA; the Notice to Users of Consumer Reports of Their Obligations under the FCRA; and the Notice to Furnishers of Information of Their Obligations under the FCRA. Employers must use the new forms beginning January 1, 2013.

Discrimination Issues

• The passage of AB 1964 adds to and amends California's Fair Employment and Housing Act (FEHA) by prohibiting discrimination on the basis of an employee's or job applicant's religious dress or grooming practices. In anticipation of the new law, employers should review their uniform policies and dress codes to ensure that there are sufficient accommodations for religious dress and grooming.
• AB 2386 changes the FEHA's definition of "sex" to expressly include breastfeeding and related medical conditions. As a result of AB 2386, discrimination on the basis of breastfeeding (or related medical conditions) is expressly a violation of the FEHA. Employers should not delay in revising their notices, postings, policies, and training related to preventing discrimination and harassment.
• The recently enacted "Shriver R-Word Act," also known as AB 2370, revises the language in several California statutes. Under existing law, California statutes refer to mentally retarded persons. The bill replaces the term "mentally retarded" with "intellectually disabled" and "mental retardation" with "intellectual disability." 

The content of this article is intended to provide a general guide to the subject matter, and is not a substitute for legal advice in specific circumstances.