PAGA: Private Attorney General Act

This act authorizes individuals to collect penalties previously only obtainable by the state’s Labor & Workforce Development Agency (LWDA). These are considered representative suits which are different than class action suits and cannot be waived by employees.

As of October 2, 2015 employers have the right to cure certain violations, currently, this applies to two potential defects on paystubs; inclusive dates of the pay period and name and address of the legal entity that is the employer. If this information has been missing from your paystubs and a PAGA suit is filed, you have 33 days to give written notice by certified mail to the aggrieved employee and the LWDA that the violations have been resolved. This includes providing fully compliant wage statements to each employee for the past three years. For detailed information on what needs to be included on current paystubs, please contact us.

SB 327: Meal Period Waivers

Meal period waivers are only allowed in the restaurant industry if the employee’s shift will end at six hours. On-duty meal period waivers do not hold up in court. Make sure any employee with a shift exceeding six hours is taking their break no later than the end of their 5th hour of work. Early lunching is effective as most employees can take their break before business hinders their ability to do so. Rest breaks (10 minutes) are also mandatory under the law but should not be recorded; however, these breaks must be authorized and permitted.

Meal break premiums should be paid out each and every payroll. Prior cases have ruled that a policy of not paying meal break premiums constituted both an unlawful and unfair business practice.

Independent Contractor Litigation

This is a rapidly increasing litigation sector exposing employers to large penalties. Review your delivery company contracts and operating agreements for any potential exposure under a joint employer theory. Cases have recently been brought against Uber and Amazon by their drivers claiming they are employees, not independent contractors and should not be paid less than minimum wage after their incurred expenses.

SB 358: New Equal Pay Law

Effective 1/1/16 this expands the protection to workers who do substantially similar work. It also shifts the burden of proof to employers. Employers can justify pay if it can show it is based on one or more of the following criteria: seniority, merit, quantity or quality of work, education, training or experience. The law also requires that you keep records of wages and wage rates, job classifications and the terms and conditions of employment for three years.

This law also prohibits employers from restricting employees from disclosing their wages, discussing the wages of others and inquiring about another employee’s wages, or aiding and encouraging others to exercise their rights under this new law.

AB 970: Labor Commissioner Now Has Authority Over Local Ordinances

Effective 1/1/16 this provides the labor commissioner with authority to investigate local laws regarding overtime and minimum wage violations, it also authorizes the commissioner to enforce Labor Code 2802 requiring employers to pay for business-related costs incurred by an employee. Section 2802 covers personal cell phones (including texting), mileage, uniforms, and tools.

Under AB 588, the commissioner also has the right to collect judgments against employers liable for unpaid wages. This includes issuing a lien against an employer’s property for the amount of the judgment. This places personal liability on the owner of the company and if not paid within 30 days will require a bond to be posted in order to continue to hire in California.

SB 579: Time Off Protected Reasons

Current law prohibits an employer with 25 or more employees at a single location from discriminating against an employee, with a child in a licensed daycare facility or school, from taking off up to 40 hours a year to participate in school activities. This includes parents, guardians, and grandparents and is now expanded to include stepparents and foster parents. This law also amends the Kin Care Law definition of family member to include grandparents, grandchildren, and siblings as it relates to the paid sick leave law.

As of July 2015, the paid sick leave law was amended and employers may now choose an accrual method based on time worked or a lump sum of 3 days (24 hours). Sick pay must be paid out at the employee’s regular rate of pay. This is calculated by dividing the total wages (not including overtime) by the total hours worked 90 days prior. If the employer pays out the accrued paid sick leave at the time of termination, they do need to reinstate the balance upon rehire.

Employers are not required to record the reason for paid sick leave but should still ask the reason for the absence in order to justify paid sick leave or not. Employers cannot require a doctor’s note to use paid sick leave.