In 2010 California was again consumed with budget battles and a reelection year, yet the Legislature managed to present Governor Schwarzenegger with a number of workplace-related bills. The Governor chose to veto a number of bills that would have significantly impacted California businesses, however, a few bills were signed about which employers should be aware. Many of these new laws will require employers to review and revise current policies, including employee handbooks.  The following summary highlights the key laws impacting employers and employees:

Retired Employee Health Benefits – Assembly Bill 1814
This law clarifies the state age discrimination law regarding the provision of health benefits to retirees. Many of California’s public and private sector employers provide some form of continued medical benefits to retirees before they are Medicare-eligible. This new law amends the state’s anti-discrimination statute, the Fair Employment and Housing Act (“FEHA”), to specifically permit employers to alter, reduce or eliminate these so called “bridge plans” to retired persons when they become eligible for Medicare, and clarifies that such acts will not be considered acts of age discrimination. This law now brings California in conformity with existing law under the federal Age Discrimination in Employment Act (“ADEA”) regarding retiree health benefits.

Meal Period Exemptions – Assembly Bill 569
In general, employers are required to provide employees who work more than 5 hours per day with a meal period, and those who work 10 hours per day with a second meal period. For some unionized employers, a new law may alleviate difficult-to-enforce meal requirements.

AB 569 exempts from the meal period requirements, employees in a construction occupation, commercial truck drivers, employees in the security services industry employed as security officers, and employees of electrical and gas corporations and local publicly owned electric utilities, as defined, if : (1) those employees are covered by a valid collective bargaining agreement; (2) the agreement expressly provides for wages, hours of work, working conditions, meal periods, final and binding arbitration of disputes concerning application of the agreement’s meal period provisions, and premium wage rates for all overtime hours worked; and (3) the employee’s regular hourly rate of pay is not less than 30 percent more than the state minimum wage rate (currently $10.40/hour based on the $8.00/hour minimum wage).

Organ Donor/Bone Marrow Donation Leave – Senate Bill 1304
California’s private employers, with at least 15 employees, must now provide limited paid leave to certain employees who act as medical “donors.” Under the Michelle Maykin Memorial Donation Protection Act, employees who have exhausted all available sick leave may take a paid leave of absence, not exceeding 30 days, for the purpose of organ donation, and not exceeding five days for bone marrow donation. The statute says this leave does not run concurrently with employee leave rights under the Family and Medical Leave Act (“FMLA”) or the California Family Rights Act, although it is unclear whether FMLA leave indeed will apply. Public employees are already entitled to similar paid organ and bone marrow donor leave.

Under the new law, private employers must restore employees returning from organ or bone marrow donation leave to the same (or equivalent) position held by the employee when the leave began. Additionally, the new law protects employees from retaliation.

Background Checks – Senate Bill 909
Effective January 1, 2012, this law requires additional disclosures by an employer to an applicant or employee when conducting background checks through a third party “investigative consumer reporting agency.” Designed as another measure to combat identity theft, the law requires that employers disclose the website address for the agency’s privacy practices, and whether the applicant’s or employee’s personal information will be sent out of the United States.

Domestic Violence Victims – Assembly Bill 2364
This law revises the Unemployment Insurance Code by revising it to specify that a claimant is eligible for benefits where he or she left employment to protect his or her family from domestic violence abuse. This law brings California law into compliance with federal eligibility guidelines, and makes California eligible to receive federal funding for unemployment insurance benefits.

Cal-OSHA Violations – Assembly Bill 2774
Under California law, the state Division of Occupational Safety and Health (“DOSH”) may issue citations to employers for violations of law affecting the health or safety of employees. Civil penalties may be issued, in amounts commensurate to the severity of the infraction. The civil penalty may be up to $25,000 for a “serious violation.”

This new law establishes a rebuttable presumption as to when an employer commits a “serious violation” of state workplace safety provisions. Under the new language, a serious violation will be presumed to exist if the DOSH demonstrates that there is a “realistic possibility” that death or serious physical harm could result from the actual hazard created by the employer’s violations. The new law also, for the first time, defines the term “serious physical harm,” and likewise establishes certain procedures to be followed by the DOSH in investigating alleged workplace health or safety violations before issuing a citation.

Workers’ Compensation for Contractors – Senate Bill 1254
This law amends the Business and Professions code by authorizing the state registrar of contractors to issue stop orders to employer contractors who do not have workers’ compensation coverage for his or her employees, and makes violation of these orders a crime. This law also provides procedures that must be followed for the payment of employees during a work stoppage subject to a stop order, and sets forth a process for the employer contractor to timely challenge any such stop order.

Legislative Action Denied in 2010

The Governor vetoed several employment-related bills, however, it is likely these bills will be resurrected in the future, therefore they are important to consider:

Mandatory Bereavement Leave – Assembly Bill 2340
This legislation would have required employers to provide up to three (3) days of unpaid bereavement leave to an employee for the death of a spouse, child, parent, sibling, grandparent, grandchild or domestic partner. The three (3) days of leave would not have to be taken consecutively and could be taken up to 13 months following the death. The bill would also have allowed an employee to sue or file a complaint with the state for perceived mistreatment resulting from asking for bereavement leave.

Consumer Credit Reports – Assembly Bill 482
This bill would have prohibited employers from requiring applicants or employees to submit to “credit checks” except in limited circumstances, such as for jobs in law enforcement, or where the employee’s job duties involved access to cash, financial assets, or other confidential information.

Liquidated Damages for Unpaid Wages – Assembly Bill 1881
This bill would have doubled the amount of liquidated damages that can be assessed against employers for violating the state’s minimum wage laws.

Criminal Penalties for Untimely Final Wages – Assembly Bill 2187
If passed, this law would have instituted criminal penalties for a person’s or employer’s failure to pay all wages owed to a departing employee within 90 days of the employee’s last day of work. The Governor vetoed this legislation based on his finding that there are already mechanisms in place (such as waiting time penalties) sufficient to enforce an employer’s obligation to timely pay an employee’s final wages.

Significance
Many of these new laws impacting employers will require revision of policies and examination of current practices.  As always, SharedHR is available to partner with you on the review of your Employee Handbook and consult on appropriate practices.