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Key Changes to California Employment Laws for 2021

by Gayle M. Athanacio, Aaron M. Scolari, Dennis C. Huie and Sharon Ongerth Rossi

Adding to the unprecedented challenges and changes seen in 2020, a myriad of new laws face California employers in 2021.  Several of these new laws relate to COVID-19, and some have been enacted on an urgency basis making them effective even before the new year.  Responding to the new laws designed to address the threat posed by COVID-19 is a major issue facing employers and something of a moving target; indeed, the recently approved Cal/OSHA COVID-19 Emergency Regulations setting forth obligations for mandatory exclusion from the workplace have already been revised by Executive Order of Governor Newsom. As important as it is to carefully review these new COVID-19 laws, employers should also pay close attention to the important, non-COVID-19-related changes in employment law, including sweeping changes to California’s Family Rights Act (CFRA).

What follows is a summary of the most significant changes to California employment laws for 2021.  We strongly encourage everyone with employees performing services in California to familiarize themselves with these developments as many of these new laws will affect day-to-day operations.  Unless otherwise noted, each new law or amendment mentioned below is effective January 1, 2021.

 

COVID-19 RELATED LAWS AND REGULATIONS

Bill No. and Effective Date

Summary

Cal/OSHA COVID-19 Emergency Regulations: Effective November 30, 2020

Modified by Executive Order N-84-20

 

COVID-19 Emergency Regulations adopted by the Cal/OSHA Standards Board apply to most employees not covered by the Aerosol Transmittable Disease (ADT) standard and set forth extensive obligations employers must undertake to avoid, mitigate, track, record, and report COVID-19 cases and exposures in their workplaces, in employer-provided housing, and on employer-provided transportation.  In particular, employers must establish a detailed, written COVID-19 Prevention Program, meet specific notice requirements within 1 business day of learning of a COVID-19 case in the workplace, provide COVID-19 testing in certain circumstances, and maintain earnings and benefits of employees who must be excluded from the workplace due to COVID-19 exposure.  Notably, the Emergency Regulations expressly provide a negative COVID-19 test is not required for an employee to be able to return to work.The exclusion from work and return to work provisions in the Emergency Regulations establish specific time periods for exclusion from work, including a requirement to exclude asymptomatic individuals who have been exposed to COVID-19 for 14 days.  However, on December 14, 2020, the California Department of Public Health (CDPH) published new quarantine guidance, based on CDC recommendations, instructing that asymptomatic exposed contacts can discontinue quarantine after 10 days with or without testing, provided additional protections are in place through the 14th day. Governor Newsom promptly issued an Executive Order suspending the existing exclusion from work and return to work sections of the Emergency Regulations to the extent they exceed CDPH or applicable local health officer recommendations or orders.  The Executive Order requires Cal/OSHA to promptly publish changes in the guidelines on its website.

AB 685

Sunset dates apply to some provisions.

AB 685 establishes notification requirements for COVID-19 exposures in the workplace.  These requirements are in addition to and broader than the notice requirements under the Cal/OSHA Emergency Regulations.  Employers must comply with both.  Under AB 685, within 1 business day of learning of a potential COVID-19 exposure in the workplace, most employers must provide written notice to all employees at the worksite within the infectious period, and the bargaining representative (if any).  Notice must also be provided to employers of any subcontracted employees.  The notice must: (1) inform employees that they may have been exposed to COVID-19; (2) include information about potential COVID-19 benefits that are available; (3) include information about the employer’s cleaning and disinfection plan for the worksite; and (4) be written in English and any language understood by the majority of employees, and communicated in the manner the employer normally communicates with employees.  Employers must remember not to disclose personally identifying information. If an employer receives notice of COVID-19 cases that meet the definition of an “outbreak” (as defined by the CDPH), the employer must notify the local public health agency where the worksite is located and provide specified information within 48 hours.
AB 685 also enhances Cal/OSHA’s enforcement abilities for COVID-19 related issues by streamlining the process for issuing serious violations, and allowing Cal/OSHA to prohibit operations or entry, or require the posting of an imminent hazard notification where in its opinion COVID-19 is an “imminent hazard”.  These enhanced enforcement provisions sunset on January 1, 2023.

SB 1159

Effective September 17, 2020 through January 1, 2023

 

Under SB 1159, most employers with 5 or more employees must report specific information to their workers’ compensation carriers within 3 business days of learning an employee has tested positive for COVID-19.  Carriers use this information to determine whether an “outbreak” has occurred at the employee’s worksite. If the infection occurred during an “outbreak” at the employee’s worksite, this law creates a “disputable” presumption that the infection arose out of and in the course of employment for workers’ compensation purposes.

AB 1867

Urgency Legislation: Effective September 9, 2020.

Sunset dates apply to some provisions.

AB 1867 imposes supplemental COVID-19 paid sick leave requirements to employers of 500 or more employees and to health care workers or first responders who are excluded from the Families First Coronavirus Act (FFCRA) by their employers.
Employers are required to provide up to 80 hours of paid sick leave for certain COVID-19 related reasons, up to $511 per day or $5,110 in the aggregate.
The supplemental COVID-19 sick leave for food sector workers requirements essentially codifies the supplemental sick leave requirement for these workers in Executive Order N-51-20.  Employers are required to provide up to 80 hours of paid sick leave for certain COVID-19 related reasons, up to $511 per day or $5,110 in the aggregate.
The supplemental sick leave provisions will expire the later of December 31, 2020, or the expiration of the sick leave provisions of the FFCRA.
AB 1867 also requires employers to permit employees at food facilities to wash their hands every 30 minutes and additionally as needed.
Finally, AB 1867 creates a Dept. of Fair Employment and Housing (DFEH) small employer family leave mediation program to coincide with new small employer CFRA coverage under SB 1383.

 

EQUAL EMPLOYMENT OPPORTUNITY

Bill No. and Effective Date

Summary

SB 973

 

Mirroring the now-discontinued federal EEO-1 component 2 filing requirement, SB 973 requires any private employer that has 100 or more employees and that is required to file an annual EEO-1 report under federal law to submit to the DFEH a pay data report containing specified wage information. The pay data report must include the number of employees by race, ethnicity, and sex in each of the ten enumerated EEO-1 job categories; the number of employees by race, ethnicity, and sex, whose annual earnings fall within each of the pay bands used by the U.S. Bureau of Labor Statistics in the Occupational Employment Statistics survey; and the total number of hours worked by each employee counted in each pay band.  The report must be provided to DFEH annually beginning March 31, 2021.  SB 973 also amends the Fair Employment and Housing Act to expressly permit the DFEH to take complaints relating to discriminatory pay practices under Cal. Labor Code section 1197.5.
AB 2143 Where a person has filed a claim against his/her/their employer, either in court, before an administrative agency, or under the employer’s internal complaint process, existing law prohibits settlement agreement provisions that prohibit, prevent, or otherwise restrict the aggrieved person from working for the employer, or any parent company, subsidiary, division, affiliate, or contractor of the employer, in the future.
AB 2143 amends existing law to require the aggrieved person to have brought the claim in good faith.
In addition, existing law creates an exception from the prohibition if the employer has made a good faith determination that the aggrieved person engaged in sexual harassment or sexual assault.  AB 2143 requires the determination of sexual assault or sexual harassment to be documented by the employer before the aggrieved person filed the claim.  Finally, AB 2143 expands this exception to include determinations that the aggrieved person engaged in any criminal conduct.
SB 979 Two years ago, California enacted SB 826, requiring publicly held domestic or foreign corporations whose principal executive office is located in California to increase female representation on boards of directors.  SB 979 requires that such covered corporations increase board representation from underrepresented communities—i.e., individuals who self-identify as Black, African American, Hispanic, Latino, Asian, Pacific Islander, Native American, Native Hawaiian, or Alaska Native, or who self-identify as gay, lesbian, bisexual, or transgender.  All covered corporations are to have a minimum of 1 director from an underrepresented community no later than the close of the 2021 calendar year.  No later than the close of the 2022 calendar year, covered corporations with more than 4 but fewer than 9 directors must have a minimum of 2 directors from underrepresented communities, and such corporations with 9 or more directors must have a minimum of 3 directors from underrepresented communities. The California Secretary of State may fine corporations $100,000 for the first time they fail to file board member information and $300,000 for each subsequent violation.

 

 

TIME OFF BENEFITS

Bill No. and Effective Date

Summary

SB 1383

SB1383 creates sweeping changes to California’s Family Rights Act (CFRA).  The law expands CFRA to cover employers of 5 or more employees.  Larger employers already covered by CFRA now must deal with SB 1383’s broadened qualifying uses of CFRA leave and the elimination of several limitations on leave which were previously available. For detailed information please see our article.
AB 2017 Labor Code section 233 requires employers to allow employees to use up to 6 months of their annual sick leave for reasons other than the employee’s own illness or care as specified in California’s sick leave law.  AB 2017 allows employees to designate sick leave used for these reasons.
Employers should note that sick leave provided under California’s sick leave law (Labor Code section 246.5) and many local ordinances requires that employees be able to use all their sick leave for these purposes.

AB 2399

AB 2399 expands Paid Family Leave (“PFL”) wage replacement benefits from the State of California to cover employees who take time off work due to a “qualifying exigency” relating to the covered active duty or call to covered active duty in the U.S. Armed Forces of the employee’s spouse, domestic partner, child, or parent.  The PFL program is administered by the Employment Development Department.  Employees pay into the PFL program by payroll deduction.  The wage replacement benefits correspond with the new CFRA leave entitlement for such absences under SB 1383.

AB 2992

 

Current law requires employers to give unpaid time off to employees who are victims of domestic violence, sexual assault or stalking to obtain restraining orders, or appearing in court to obtain relief to ensure their health, safety, or welfare, or that of their child, and to make reasonable accommodations to ensure their safety at work.  Employers of 25 or more employees are further required to allow unpaid time off for employees to seek medical, psychological, or social services relating to these crimes.
AB 2992 expands the scope of the crimes, victims, and leave purposes to which these obligations apply and the types of documentation that must be accepted by employers.

 

WAGE AND HOUR

Bill No. and Effective Date

Summary

AB 2257

Urgency legislation – effective Sept 4, 2020

Last year, California’s AB5 drastically changed the rules for independent contractor classification with the adoption of the strict “ABC” test, except for certain specifically enumerated exceptions which, if applicable, allow for the less restrictive Borello test to apply.  This year AB 2257 amends some existing exceptions and creates several new exceptions. Changes include, among others:
• Bona fide business-to-business contracts, provided certain criteria are met;
• Certain services provided to customers through “referral agencies”; and
• Certain occupations in creative fields.
AB 2257 also grants District Attorneys authority to file for injunctive relief against businesses suspected of misclassifying independent contractors.  In addition, state agencies, including the California Labor Commissioner’s office and the EDD, continue to have authority to pursue administrative actions for misclassification, and private rights of action continue to be available mechanisms of enforcement.  For more information on AB5 and its amendment (AB 2257), click here.
State Minimum Wage Increase On January 1, 2021, California’s minimum wage increases to $14 per hour for employers of 26 or more employees and $13 per hour for employers of 25 or fewer employees.  Minimum salaries for California’s white-collar exemptions, which are based on the minimum wage, will also increase.  Employers should also remember to check local minimum wage laws, many of which require higher hourly rates.

AB 1512

Enacted/Effective September 30, 2020;

Sunsets January 1, 2027

Applicable only to unionized private patrol operators registered under the Private Security Services Act, AB 1512 carves out an exception to the generally applicable rules regarding mandated rest breaks under California law.  If certain conditions are met, unionized security officers can be required to remain on premises and be on call during rest periods.  With respect to claims, this law applies only to cases filed on or after January 1, 2021.

AB 1947

 

AB 1947 extends the statute of limitations to file a claim under Labor Code section 98.7 with the Division of Labor Standards Enforcement (DLSE) from 6 months to 1 year.  Accordingly, individuals believing they have been discharged or discriminated against in violation of any law over which the Labor Commissioner has jurisdiction now has 1 year to file such a complaint.  The one-year limitation may also be extended for good cause.
The bill also amends Labor Code section 1102.5, which prohibits employers from retaliating against employees who disclose violations of federal, state or local law, to allow a court to award attorneys’ fees to a successful plaintiff bringing a claim under Section 1102.5.
AB 2479 The current exemption to provide duty free meal and rest periods for safety sensitive positions at certain petroleum facilities is currently due to expire on January 1, 2021.  This bill extends the exemption to January 1, 2026.

AB 3075

 

AB 3075 creates new Labor Code section 200.3 providing that a “successor” to any judgment debtor will be liable for any wages, damages, and penalties owed to a judgment debtor’s workforce pursuant to a final judgment. “Successor” is defined as one who:
(1) Uses substantially the same facilities or workforce to offer substantially the same services as the judgment debtor;
(2) Has substantially the same owners or managers controlling the workforce as the judgment debtor;
(3) Has a managing agent (defined in Civil Code section 3294(b)) who directly controls the wages, hours, or working conditions of the affected workforce of the judgment debtor; or
(4) Operates a business in the same industry and the business has an owner, partner, officer, or director who is an immediate family member of any owner, partner, officer, or director of the judgment debtor.
The bill adds a requirement that business entities doing business in California disclose in Secretary of State Statements of Information whether any officer, director, or LLC member or manager has an outstanding final judgment (no appeal pending) issued by the DLSE or a court for violating any wage order or Labor Code provision.  This requirement takes effect the earlier of January 1, 2022 or the Secretary of State’s certification that the California Business Connect project (for online filing and access of documents) is implemented.
Unrelated to the above, this bill also expressly authorizes local jurisdictions (city, county, district or agency) to enforce more stringent local labor standards that are not in conflict with or preempted by state law when operating a program receiving state assistance. The bill also prohibits state agencies from requiring local jurisdictions to refrain from applying their labor standards as a condition to the receipt of state funds or assistance.
SB 1384 Existing law allows the Labor Commissioner to represent indigent claimants in de novo proceedings (appeals of Labor Commissioner wage claim awards), and requires the Labor Commissioner to do so where the claimant is trying to uphold, and not objecting to, any part of the Labor Commissioner’s award.  SB 1384 allows the claimant to request Labor Commissioner representation in any court-ordered arbitration, and requires that petitions to compel arbitration of appeals of Labor Commissioner wage claim awards be served on the Labor Commissioner.

 

PUBLIC WORKS/CONSTRUCTION

Bill No. and Effective Date

Summary

AB 2231 Under current law, “public works” do not include private projects where the state or political subdivision provides a public subsidy to the private development that is de minimis in the context of the project.  This new law specifies that a public subsidy is in fact de minimis if it is both less than $600,000 and less than 2% of the total project cost.  Further, a public subsidy for a residential project that consists entirely of single-family dwellings is de minimis if it is less than 2% of the total project cost.  These provisions do not apply to a project that was advertised for bid, or a contract that was awarded, before July 1, 2021.
AB 2311 This new law requires public entities to provide notice in all bid documents and construction contracts that the project is subject to the skilled and trained workforce requirement when the use of a skilled and trained workforce to complete a contract or project is required under existing law.  In the event a public entity fails to provide the required notice, the public entity must still use a skilled or trained workforce, and it must obtain an enforceable commitment that a bidder, contractor, or other entity will use a skilled and trained workforce to complete a contract or project.

AB 2765

AB 2765 expands the definition of “public works” to include work done under private contract on a project for a charter school, as defined, when the project is paid for, in whole or in part, with the proceeds of conduit revenue bonds, as defined, issued on or after January 1, 2021.

 

CALIFORNIA CONSUMER PRIVACY ACT

Bill No. and Effective Date

Summary

Proposition 24 Proposition 24 excludes the following employment-related information from coverage under the California Consumer Privacy Act (CCPA) until January 1, 2023:
(1) personal information collected by a business in the course of a person acting as a job applicant, employee, or contractor for the business if such personal information is collected and used by the business only in the context of the person’s role with the business;
(2) emergency contact information if the information is used solely within the context of having an emergency contact on file; and
(3) personal information necessary for the business to retain or administer benefits if the personal information is collected and used solely within the context of administering those benefits.
Employers covered by the CCPA must still comply with the CCPA’s notice provisions requiring disclosure of the categories of personal information to be collected and the business or commercial purposes for which each category of information will be used, including any secondary purposes, and individuals will still have the right to statutory damages for data breaches of that information.

 

NEW LAWS RELATING TO EMPLOYMENT OF MINORS

Bill No. and Effective Date

Summary

AB 908

Enacted September 11, 2020.  Effective immediately.

 

This new law authorizes issuance of work permits for minors older than 14 but under 16 without appearance of the minor’s parent or guardian (which is generally required), as long as the electronic application is complete and successfully submitted and when the minor’s school is physically closed for an extended period of time because of a natural disaster, pandemic, or other emergency, and the minor has attended a video conference with the person issuing the work permit accompanied by the minor’s parent or guardian.
AB 908 also prohibits withholding a minor’s work permit based on grades, grade point average, or attendance if the minor’s school has been physically closed for an extended period of time due to natural disaster, pandemic, or another emergency.

AB 3175

Enacted September 25, 2020.  Effective immediately.

As a condition of issuance of a work permit for a minor between 14 to 17 years old in the entertainment industry, AB 3175 requires the parent or guardian to ensure that the minor completes training in sexual harassment prevention, retaliation, and reporting resources which is available online on the DFEH’s website.  The parent or guardian must accompany the minor to the training and certify to the Labor Commissioner the training has been completed.  The training must be in the language understood by that accompanying person whenever reasonably possible.

AB 3369

Enacted September 28, 2020.  Effective immediately.

Amends Government Code § 12950.1

AB 3369 exempts employers from providing sexual harassment training mandated under the Fair Employment and Housing Act (FEHA) if:
(1) the employee received such training in the past two years from either a current, prior, alternative, or joint employer; or
(2) the employee received a valid work permit from the Labor Commissioner that required the employee to receive training within the prior two years.
Any such employee exempted must be provided and is required to read and acknowledge receipt of the employer’s anti-harassment policy within six months of hire.  The employee must thereafter be placed on a two-year tracking schedule based on the last training.
The current employer bears the burden to show that the prior training was compliant with the FEHA.

Rogers Joseph O’Donnell’s Labor and Employment Law Practice Group is comprised of experienced labor and employment attorneys with extensive experience representing and advising individuals, businesses, government contractors, and public entity employers.

The depth and breadth of our employment law experience allows us to offer the same quality of representation usually expected from much larger law firms, while our relatively small size enables us to maintain highly competitive rates and a more direct and personal relationship with our clients.

Our labor and employment practice focus on counseling – guiding employers as to how to navigate the patchwork of employment laws and avoid litigation before it starts – while also defending against single and multiple plaintiff litigation, class and collective actions, and PAGA actions. While we believe that early case evaluation and mediation are often advantageous ways to minimize the costs and disruption of protracted litigation, we are also skilled, trial-ready attorneys with a winning record in court, administrative hearings and arbitration.

If you have questions about California labor and employment law, please contact the Rogers Joseph O’Donnell attorney with whom you regularly work, or the authors of this legal update.

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