What Changes Will 2023 Have in Store for California Employers? A Summary by Thakur Law Firm

As we near the end of 2022, California employers brace themselves for they have come to face what is known as a perennial flood of new employment laws and changes to existing laws and regulations affecting the workplaces statewide. With the COVID-19 pandemic beginning to drop from the top of lawmakers’ employment law agendas, there has been no shortage of workplace issues that have inspired a full spate of new legislation going into effect on January 1, 2023. California employers must become well-versed or risk bearing the brunt of the latest wave of lawsuits and regulatory clampdowns to hit the state.

The lawyers at Thakur Law Firm, APC, however, have been carefully monitoring the legislative docket and have compiled the following summary of some of the most significant laws to which California employers and employees will need to adapt in 2023. All laws discussed in this post go into effect on January 1, 2023, unless otherwise specified.

LEAVES OF ABSENCE

• Leave to Care for a “Designated Person”- Currently, under the California Family Rights Act (CFRA) and the Healthy Workplaces, Healthy Families Act (HWHFA), employees are entitled to leave from work to care for a spouse, registered domestic partner, child, parent, parent-in-law, grandparent, grandchild, and sibling. However, beginning January 1, 2023, AB 1041 permits employees to take CFRA leave or HWHFA leave to care for a “designated person.” The CFRA defines “designated person” as “any individual related by blood or whose association with the employee is the equivalent of a family relationship.” The statute also provides that “[t]he designated person may be identified by the employee at the time the employee requests the leave.” The HWHFA defines “designated person” more broadly as “a person identified by the employee at the time the employee requests paid sick days.” Under both statutes, an employer may limit an employee to one designated person per 12-month period.

• Bereavement Leave - Additionally, bereavement leave of up to five days within three months of the death of a family member will become a protected leave of absence under AB 1949 so long as the employee has been employed for at least 30 days prior to taking leave. “Family member” includes a spouse, child, parent, sibling, grandparent, grandchild, domestic partner, or parent-in-law. The law applies to all employers except private employers with fewer than five employees. Although bereavement leave may be unpaid, employees may use alternative available paid leave (e.g., PTO, sick leave, etc.) during the bereavement leave. Please note that employers may require documentation for bereavement leave.

DISCRIMINATION

• Use of Cannabis - Beginning January 1, 2024, AB 2188 will add cannabis protection to California’s Fair Employment and Housing Act (FEHA). Basically, the law will prohibit employers from discriminating against employees or job applicants based on their off-duty, offsite use of cannabis. It is worth highlighting that this only protects employees’ use of cannabis while off the job and away from the workplace and does not prohibit discrimination from employees’ or applicants’ use of other substances.

• Reproductive Health - FEHA will also be expanded under SB 523 by prohibiting employers from discriminating against an employee or applicant based on his or her “reproductive health decision-making.” This includes decisions to use or access a particular drug, device, product, or medical service for purposes of reproductive health.

TRANSPARENCY IN PAY

• Pay Scales - Generally, SB 1162 will require employers to provide pay scale information to employees and job applicants upon his or her request. For employers with 15 or more employees, such information must be included in any job posting, even if the employer utilizes a third party to make the job posting. Moreover, employers must maintain inspectable job-title and wage-rate histories for employees during their course of employment plus three years thereafter. An employer’s failure to comply with SB 1162 creates a rebuttable presumption in favor of an employee’s claim and may result in fines ranging from $100 to $10,000, except for the first violation if the employer remedies such failure.

• Pay Data - For employers with 100 or more employees SB 1162 also requires reporting of the “median and mean hourly rate within each job category, for each combination of race, ethnicity, and sex in the report.” Separate reports are required where the employees are hired through labor contractors. Because pay data reports will be due the second Wednesday of May beginning in 2023, the first report under the new requirements will be due May 10, 2023.

WORKPLACE SAFETY

• Adverse Action - SB 1044 will prohibit employers from taking or threatening adverse action against an employee (except for exempt employees, such as first responders) who refuses to report to, or leaves, a workplace that the employee reasonably believes is unsafe. The statute applies to “emergency conditions”, which include (1) conditions of disaster or extreme peril to the safety of persons or property at the workplace or worksite caused by natural forces or a criminal act, and (2) orders to evacuate a workplace, worksite, worker’s home, or the school of a worker’s child due to natural disaster or a criminal act. Notably, a health pandemic specifically does not constitute an emergency condition. SB 1044 also prohibits employers from preventing an employee from accessing a communications device for purposes of the emergency condition. “When feasible,” employees must notify employers in advance of the emergency condition and, if not feasible, employees must notify employers as soon as possible thereafter.

• Posting Requirements - Beginning in 2023, AB 2068 will require employers to post a new employee notification prepared by Cal/OSHA in English and the top seven non-English languages spoken, as specified, in addition to the preexisting posting requirements.

COVID-19

• Notice of Requirements - COVID-19 notice requirements have been extended to January 1, 2024, by AB 2693. However, such requirements have been modified to allow employers to comply by prominently displaying, for 15 days, a notice of the potential exposure in the workplace that contains the dates on which the COVID-19 case was at the worksite within the infectious period. Employers no longer need to report cases to local health departments.

• Workers’ Compensation - AB 1751 extends until January 1, 2024, the preexisting rebuttal workers’ compensation presumption for workers that contract COVID-19 under certain conditions.

• Supplemental Paid Sick Leave - AB 152 extends employees’ eligibility to use 2022 COVID-19 Supplemental Paid Sick Leave through December 31. 2022.

PAID FAMILY LEAVE

• Wage Replacement Rates - Under SB 951, the current wage replacement rates (up to 70 percent of regular wages) for California’s Paid Family Leave (PFL) and State Disability Insurance (SDI) programs are extended through December 31, 2024, after which PFL and SDI rates will increase (up to 90 percent of regular wages).

• Grant Program - Until the earlier of May 31, 2024, or the exhaustion of applicable funds, California will have in place a PFL grant program that aims to offset, up to $2,000, eligible small businesses’ increased costs incurred as a result of employees’ leave.

PRIVACY

Beginning January 1, 2023, the California Privacy Rights Act (CPRA), or Proposition 24, will require applicable employers to comply with multiple notice and disclosure requirements with respect to personal information collected from their employees and job applicants, and will have numerous other obligations involving employees’ rights. Because the provisions of the CPRA are rather complex, employers should consult with legal counsel to ensure compliance

RETIREMENT SAVINGS

SB 1126 expands the definition of “eligible employer” under the CalSavers Retirement Savings Program (CalSavers) to a person or entity with at least one employee, but does not include sole proprietorships, self-employed individuals, or any business entity that does not employ anyone other than its owner(s). Employers that currently do not offer their own sponsored retirement program to employees must have a payroll deposit retirement savings arrangement by December 31, 2025.

FAST- FOOD

AB 257 provides for the creation of the Fast-Food Council within the Department of Industrial Relations, which will establish minimum wages, working hours, and other working conditions for fast food restaurants.

AGRICULTURE

AB 2183 alters the union election process for agricultural workers. The statute permits a labor organization to be certified as the exclusive bargaining representative of a bargaining unit if a majority of members agree and the Agricultural Labor Relations Board (ALRB) approves.

CALL CENTERS

Under AB 1601, which applies to call center employers that employ or have employed within the preceding 12 months 75 or more persons, an employer of customer service employees in a call center must follow California Worker Adjustment and Retraining Act (Cal/WARN) requirement before relocating a call center to a foreign country, which includes providing 60 days’ prior notice to affected employees.

Takeaways

California workers and employers should always be mindful of the implications of changes in the law that go into effect at the beginning of the year. Especially in preparation for the coming new year, employers should make a point of brushing up on existing policies and practices to make sure they conform to new laws and changes to old laws.

While this article certainly cannot address all issues employers may encounter in 2023, becoming aware of the trends and changes in the law can help lessen the chances of being blindsided by unforeseen shifts in the legal landscape in any given industry.

The team of experienced employment attorneys at Thakur Law Firm, APC are dedicated to monitoring the legal environment for new legislation and court decisions that potentially impact the rights of our clients and ensuring we can offer them the most practical and effective strategies for adapting to such changes. Do not hesitate to contact Thakur Law Firm, APC with any questions about the new laws discussed in this article or any other employment-related issues.