2014 Employment Law update

1. 2014 Employment Law update Daniel J. Muller Slater Hersey & Lierberman LLP 160 W. Santa Clara Street, Suite 1575 San Jose CA 95112 dmuller@slaterhersey.com 408-512-3025

2. NEW LEGISLATION - Minimum Wage • Labor Code 1182.12 defines the minimum wage. New amendments will take effect in July 2014 and January 2016. • The minimum wage as of July 1, 2014 will be $9.00 • The minimum wage as of January 1, 2016 will be $10.00

3. NEW LEGISLATION - Paid Family Benefits • SB 770 amends, repeals, and adds provisions to the Unemployment Insurance Code relating to the Paid Family Leave (PFL) benefit program administered by the California Employment Development Department (EDD). • The PFL program is similar to the California State Disability Insurance (SDI) program and provides up to six weeks of monetary benefits (but not time off or leave) to employees who take time off to care for a sick “family member.” • The new provisions, which become effective on July 1, 2014, expand the definition of “family members” to include grandparents, grandchildren, siblings, or parents-in-law.

4. NEW LEGISLATION - Leaves For Crime Victims • SB 288 amends the Labor Code to add section 230.5. • Section 230.5 prohibits employers from discharging, discriminating against, or retaliating against employees who are victims of certain offenses who take time off from work to appear in court involving the crime at issue. The leave is unpaid and employers are authorized to review court records to verify the need for leave. • The specified offenses covered by this law include vehicular manslaughter while intoxicated, felony child abuse likely to produce great bodily harm or a death, assault resulting in the death of a child under eight years of age, felony domestic violence, felony physical abuse of an elder or dependent adult, felony stalking, solicitation for murder, “serious felony,” hit-and-run causing death or injury, felony driving under the influence causing injury, and sexual assault.

5. NEW LEGISLATION - Accommodation for crime victims • SB 400 amends Labor Code sections 230 and 230.1 and extends the protections provided to employees who are victims of domestic violence and sexual assault to employees who are known or suspected victims of stalking. • The new law prohibits employers from discharging, discriminating against, or retaliating against employees because of an employee’s known status as a victim of stalking and allows employees to take unpaid protected time off from work to attend to legal, safety-related, and personal issues resulting from being a victim of crime. • Employers are required to engage in the interactive process and provide reasonable accommodations for a victim of domestic violence, sexual assault, or stalking who requests an accommodation. • Reasonable accommodations may include implementing safety precautions at work. The employer may require certification of the employee’s continued victim status for the time off and reasonable accommodation.

6. NEW LEGISLATION - Criminal Background checks • SB 530 – Creates New Limitations on the use of Criminal Background Checks. • New law amends Labor Code 432.7 and adds section 4852.22 to the Penal Code. • Employers are prohibited from asking applicants to disclose information concerning convictions that have been judicially dismissed or ordered sealed unless: • The Employer is required by law to ask; • The Applicant is seeking a position that requires possession or use of a firearm; or • The applicant is legally prohibited from obtaining the position. • Absent the listed exceptions, the Employer cannot consider judicially dismissed or sealed convictions when making an employment decision.

7. NEW LEGISLATION – Military / Veteran Status • AB 556 adds "military and veteran status" to the list of categories protected from employment discrimination, harassment, and retaliation under the Fair Employment and Housing Act (FEHA). • "Military and veteran status" is defined as a member or veteran of the United States Armed Forces, United States Armed Forces Reserve, the United States National Guard, and the California National Guard. • The new law provides an exception for an inquiry by an employer regarding military or veteran status for the purposes of awarding veterans' preference points.

8. NEW LEGISLATION – Sexual Harassment • SB 292 – Amends the California Fair Employment & Housing Act so that employees asserting claims for sexual harassment no longer need to prove “sexual desire” in order to prevail. • The legislation is in response to the Court of Appeal’s decision in Kelly v. Conco Companies (2011) 196 Cal. App. 4th 191. In that case, the Court ruled that a plaintiff failed to prove sexual harassment because the alleged male harasser was neither a homosexual nor exhibited any sexual desire toward the target of the harassment.

9. NEW LEGISLATION – Whistleblower protection • SB 496 – Provides expanded whistleblower protected by amending Section 1102.5 of the California Labor Code. • Prohibits an employer from making, adopting, or enforcing any rule, regulation, or policy preventing an employee from disclosing information to a government or law enforcement agency if the employee has reasonable cause to believe that the information discloses a violation of, or noncompliance with, a local rule or regulation. • Prohibits retaliation against an employee where an employer believes that a protected disclosure has taken place or will take place. • Prohibits retaliation against an employee who refuses to participate in an activity that would result in a violation of, or noncompliance with, a local rule or regulation

10. NEW LEGISLATION – Wage complaints • AB 263 – Expands the Definition of Protected Conduct. • Definition of protected conduct is expanded to include written or oral complaints made by employees who believe they are owed unpaid wages. • Employees who face retaliation or adverse actions will be entitled to reinstatement and reimbursement of lost wages. • Violations may result in penalties of up to $10,000.00 per violation. • The new provisions also make it unlawful for employers to engage in, or direct others in, unfair immigration practices. In other words, it is unlawful to threaten to report employees to immigration authorities.

11. NEW LEGISLATION – Recovery of attorneys’ fees • SB 462 – Amends Labor Code Section 218.5 to make it more difficult for employers to recover attorneys’ fees. • Section 218.5 pertains to the awarding of attorneys’ fees in lawsuits for unpaid wages. • Generally, if the employee wins, he or she will be awarded reasonable attorneys’ fees. • If the employer wins, it will only be awarded reasonable fees if it can prove that the employee brought the claims in “bad faith.”

12. Court decisions – Leaves of Absence Sanchez v. Swissport, Inc.(2013) 213 Cal. App. 4th 1331 • Employee disabled by pregnancy may be entitled to leave beyond four months as a “reasonable accommodation.” • Court ruled that the Pregnancy Disability Leave Law’s remedies augment rather than supplant the remedies of other disability laws. • According to the Court, even if an employee has exhausted her PDDL leave, the employer must still consider whether additional leave should be granted as a reasonable accommodation under the FEHA.

13. Court decisions – Independent contractors Beaumont-Jacques v. Farmers Group, Inc. (2013) 217 Cal. App. 4th 1138 • Trial Court properly granted summary judgment against plaintiff because she was an independent contractor • Court ruled that employer did not exercise sufficient control over plaintiff to create an employment relationship. • Key facts: Plaintiff determined her own hours; decided which meetings to attend; hired and trained her own staff; paid her own operating expenses; identified herself as self-employed on her tax returns

14. Court decisions – disability discrimination Lawler v. Montblanc North Am., LLC (9th 2013) 704 F.3d 1235 • Retail store manager who could not be present as store due to disability could not make prima facie showing of disability discrimination due to inability to perform essential duties. • A single, intimidating or gruff encounter with a corporate vice president was not enough to constitute harassment. Furtado v. State Pers. Bd. (2013) 212 Cal. App. 4th 729 • Employer was not required to eliminate essential physical functions of a job by modifying correctional officer position or creating a new administrative position.

15. Court decisions – Wage and hour Negri v. Koning & Assocs., (2013) 216 Cal. App. 4th 392 • An employee paid an hourly rate with no guaranteed minimum weekly salary is not exempt from California overtime pay requirements under the administrative exemption.

16. Court decisions – liability for employee acts Halliburton Energy Servs., Inc. v. Dep’t of Transp., (2013) 220 Cal. App. 4th 87 • Employer was not liable for damages caused by employee driving a company vehicle for personal reasons. The employee was on a personal trip that had no bearing on any work-related activity Moradi v. Marsh USA, Inc., (2013) 219 Cal. App. 4th 866 • Employer was liable for employee accident involving employee’s personal vehicle because Employer required employee to use the vehicle for work purposes such as attending client meetings and transporting other employees.

17. Court decisions – punitive damages Davis v. Kiewit Pac. Co., (2013) 220 Cal. App. 4th 358 • An employer may be liable for punitive damages when managing agents act with oppression, fraud, or malice in a working environment.