California Adopts New Disability Regulations

We recently posted about California's adoption of new pregnancy disability regulations, which took effect December 30, 2012.  On December 18, California further adopted general disability regulations governing accommodation requirements for non-pregnancy related disabilities.  The disability regulations took effect December 30, 2012 and are available here.  The new regulations are 23 pages in length and contain definitions of mental and physical disabilities, explain essential versus non-essential job functions, and provide detail on employer and employee responsibilities in engaging in the interactive process and providing reasonable accommodation.  The new regulations incorporate the broad disability definitions and standards set forth under the recent amendments to the federal ADA, making the analysis of whether an employee is disabled much more similar under California and federal law than it used to be.  In simplest terms, it is rather easy to qualify as "disabled" under California (and federal) law.  Thus, in disability discrimination cases, the pivotal liability analysis will focus on the employer's response to the disability, not whether the employee qualifies as disabled.  In short, almost any condition (save and except very minor conditions, such as a common cold or scrape) qualifies as a disability as long as it limits a major life activity in some way.  The California regulations make clear, like the recent amendments to the ADA, that mitigating measures (such as glasses or contact lenses) may not be considered when determining whether a condition limits a major life activity.  Additionally, where the major life activity of working is considered, a condition can be determined to limit an employee's ability to work even if the condition only limits the employee's performance of one particular job (as opposed to an entire class of jobs). 

While the new regulations are too lengthy to summarize in their entirety in this post, there are some interesting points worth noting.  First, the regulations contain a lot of discussion about considerations of transferring a disabled employee to a vacant alternative position as a reasonable accommodation.  This concept is not new in and of itself.  However, what is new is that the regulations expressly state that employers are required to give preference to disabled employees when filling a vacant position.  The only exception is that the employer is not required to ignore a bona fide seniority system.

The regulations also discuss the circumstances under which employers may require medical documentation to support a request for reasonable accommodation.  Interesting in this regard is that the regulations imply that an employer is not entitled to request medical documentation in every circumstance.  The regulations instead say that the employer may request medical documentation "when the need for reasonable accommodation is not obvious."  Furthermore, in situations where the employer seeks medical documentation, the employer must communicate its requests (whether initial or supplemental) through the employee (not directly to a medical provider).  California (unlike federal law) continues to disallow employers from seeking diagnosis information or any medical information not necessary to determine the need for reasonable accommodation.  Finally, where the employee needs reasonable accommodation for over a year, the employer may request further medical certification on a yearly basis.  The regulations do not allow requests for recertification at earlier or more frequent intervals. 

All California employers (in particular, their Human Resources or other personnel responsible for managing leave requests or accommodation requests) should review the new disability regulations to ensure that their practices comply with the standards set forth therein. 

Democratic Supermajority in California Legislature Moving Quickly to Significantly Raise California Minimum Wage

Yesterday, on the first day of this year’s California Legislative session, Assemblymember Luis Alejo introduced a bill that would significantly raise California’s minimum wage starting in 2014.  If enacted in its current form, the California minimum wage would go to $8.25 in 2014, $8.75 in 2015 and $9.25 in 2016.  Starting in 2017, the minimum wage would be automatically adjusted based on inflation indexes.  For a complete copy of the bill, you can click here.  With the Democrats holding supermajority status in the Assembly and State Senate, we expect many pro-employee bills to be introduced in the coming months.  We will track them for you throughout the Legislative session.

California Adopts New Regulations Governing Pregnancy Disability Leaves

California's Fair Employment and Housing Commission recently proposed new pregnancy disability regulations.  These proposed regulations underwent rounds of public comment and revision, but were recently finalized and approved by California's Office of Administrative Law.  As such, the new regulations take effect December 30, 2012.  The new regulations are available here.  California employers with 5 or more employees are required to provide up to 4 months of pregnancy disability leave to employees disabled by pregnancy or related conditions and there is no length of service requirement to be eligible for this leave.  The new regulations detail the process an employer is required to follow in accommodating such leave requests, from initial certification through reinstatement.  The regulations also clarify how "four months" is calculated for purposes of identifying the maximum amount of leave available to full-time and part-time employees.  The regulations further make clear (based on a recently enacted California law) that employers are required to maintain group health benefits under the same terms as if the employee was actively reporting to work for up to 4 months, and that this requirement is in addition to any additional obligation to maintain health benefits during an an additionally approved FMLA/CFRA leave of up to 12 weeks.  The new regulations contain a great amount of detail and guidance for employers trying to manage this leave process.  Employers are advised to review the rules and their policies and practices to ensure compliance.

The FEHC also has proposed regulations pending on disability (non-pregnancy) leaves.  Those rules are not yet final, but are available here for employers who are interested in reviewing and possibly providing comment and/or proposed changes to the FEHC. A public comment period is currently underway through December 17, 2012.  We will post developments here.

IRS Mileage Reimbursement Rate Going Up January 1

The Internal Revenue Service has announced the standard mileage reimbursement rate for business travel for 2013.  Effective January 1, 2013, the standard mileage rate will be 56.5 cents per mile (up from 55.5 cents per mile in 2012).   The IRS announcement is here.  Although California employers are not required to reimburse employee travel at the IRS mileage rate, it is advisable to do so because other methods for providing adequate reimbursement are more difficult and burdensome to prove.    

Minimum Wage Increasing for Employees in San Francisco and San Jose

California employers with employees in the cities of San Francisco and San Jose should take note of minimum wage increases for these cities taking effect in 2013.  San Francisco passed its minimum wage ordinance a few years ago, but the minimum wage is subject to adjustment each year based on the cost of living.  Effective January 1, 2013, the minimum wage for employees who perform at least two hours of work per week in the City of San Francisco is $10.55 per hour (up from $10.24/hour in 2012).

This week, San Jose voters approved a local minimum wage for the City of San Jose as well.  With the passage of Measure D, the minimum wage for employees working in San Jose will be $10.00 per hour.  The new San Jose minimum wage takes effect 90 days after the election results are certified, which means approximately March 2013.

The state minimum wage otherwise remains at $8.00 per hour. 

California Increases Minimum Exempt Pay Rates for Computer Professionals and Licensed Physicians/Surgeons

California Labor Code sections 515.5 and 515.6 provide an overtime exemption for certain computer professionals and licensed physicians/surgeons who meet specified criteria for exemption.  One of those criteria is that they earn specified minimum pay, the amount of which is subject to annual adjustment by California’s Department of Industrial Relations (DIR).  The DIR has announced increases to the minimum pay for these workers as follows:

  • The DIR has increased the computer software employee's minimum hourly rate of pay for exempt status from $38.89 to $39.90, the minimum monthly salary from $6,752.19 to $6,927.75, and the minimum annual salary from $81,026.25 to $83,132.93, effective January 1, 2013; and
  • The DIR has increased the licensed physicians and surgeons employee's minimum hourly rate of pay for exempt status from $70.86 to $72.70, effective January 1,2013.

The DIR’s announcements are here and here.  Employers relying on these exemptions for  exempt computer professionals and licensed physicians/surgeons will want to take note of these changes and adjust their pay practices accordingly.

Webinar: New Laws & Regulations in the Golden State for 2013

2012 has been one of the most active years in California labor and employment law in recent times.  Changes have been made in many fields, including, but not limited to, wage and hour law and regulation, personnel file inspection rules, immigration, social media regulations, and California discrimination laws.  Some of these updates are already effective.  Many others become effective on January 1, 2013.  Please join CDF Partners Mark Spring and Robin Largent for a complimentary webinar on November 27, 2012 from 10:00 a.m. to 11:00 a.m. PST, during which they will update attendees on these legal developments, as well as what changes employers will need to make to policies and practices to ensure compliance with these developments.  For more information and to register, click here.  This webinar is approved for MCLE and HRCI credit.

California Governor Signs Some Employment Bills and Vetoes Others

Yesterday was the last day for California’s Governor to sign or veto legislation passed by the California Legislature this term.  In the past few days he finally acted on various pieces of employment-related legislation, by signing several bills into law and vetoing a couple.

Bills Signed Into Law

AB 2386 (FEHA amendment):  This bill includes breastfeeding and conditions related to breastfeeding under the definition of “sex” under FEHA, making clear that discrimination against a woman because of breastfeeding (or related conditions) is unlawful.

AB 1744 (temporary services employers):  This bill amends Labor Code section 226 relating to itemized wage statement requirements to impose additional requirements on temporary services employers (with the exception of security services companies) effective July 1, 2013.  In addition to the information already statutorily required to be included on employees’ wage statements, temporary services employers will also need to provide itemized information concerning the rate of pay and total hours worked for each assignment.  The bill also amends Labor Code section 2810.5—the statute requiring employers to provide written notice to new employees of certain wage-related information—to require temporary services employers (effective July 1, 2013) to provide the name, physical and mailing address and telephone number of the main office of the legal entity for whom the employee will perform work.  Again, security services companies are exempt from this requirement.

AB 2103 (fixed salaries and overtime):  This legislation overturns a 2011 California court decision in Arechiga v. Dolores Press (see our prior post on the case here), which held that an employer and employee can agree to a fixed salary that includes payment of overtime compensation.  Under the new law, Labor Code section 515 is amended to provide that payment of a fixed salary to a non-exempt employee will be deemed to be payment only for the employee’s regular non-overtime hours, notwithstanding any private agreement to the contrary.

AB 2674 (inspection of personnel records):  This bill amends Labor Code section 1198.5, which allows employees to inspect certain of their personnel records.  First, the new law makes clear that the inspection right applies to both current employees and former employees.  Second, the new law requires employers to maintain personnel records (including records relating to an employee’s performance and to any grievance concerning the employee) for at least three years after termination of employment.  Third, the new law requires that a current or former employee (or any authorized representative) is entitled to inspect (and to receive a copy, upon request) personnel records relating to their performance and/or to any grievance concerning the employee within 30 days of making a request.  The employee or representative must make the inspection request in writing, but may request a form from the employer to do so, which then must be provided by the employer.  The employer may redact the name of any non-supervisory employees referenced in the records, prior to making them available for inspection.  The employer may charge the employee the actual cost of reproduction if copies are requested.  The employer is not required to comply with more than 50 requests in any calendar month by a representative of employees for personnel records.  Additionally, if a former employee has an employment-related lawsuit pending against the employer, the employer is not required to make personnel records available under Section 1198.5 during the pendency of the lawsuit.  Finally, the new law establishes that if an employer fails to comply with inspection and copying requests under Section 1198.5, either the employee/former employee or Labor Commissioner may collect a penalty of $750.

AB 2675 (commission contracts):  Last year, legislation was enacted requiring commission payment arrangements to be in writing for California employees.  AB 2675 amends Labor Code section 2751 to exempt certain payments from this requirement.  Specifically, it exempts temporary, variable incentive payments that increase, but do not decrease, payment under the written contract.

SB 1255 (penalties for wage statement violations):  Under this new law, it will be easier for employees to prove “injury” for itemized wage statement violations and thereby recover damages or penalties.  The new law provides that employees are “injured” if the employer fails to provide a wage statement or fails to provide an accurate and complete wage statement from which the employee can promptly and easily determine the amount of the gross or net wages paid to the employee during the pay period or other specified information, the deductions the employer made from the gross wages to determine the net wages paid to the employee during the pay period, the name and address of the employer or legal entity that secured the services of the employer, and the name of the employee and only the last 4 digits of his or her social security number or an employee identification number other than a social security number, as specified.

AB 1844 (social media policies):  This legislation prohibits an employer from requiring or requesting an employee or applicant for employment to disclose a username or password for the purpose of accessing personal social media, to access personal social media in the presence of the employer, or to divulge any personal social media.  This legislation also prohibits an employer from discharging, disciplining, threatening to discharge or discipline, or otherwise retaliating against an employee or applicant for not complying with a request or demand by the employer that violates these provisions.

Vetoed Bills:

AB 1450 (discrimination against unemployed):  This bill would have made it unlawful for employers to place ads for employment that include a requirement that applicants be currently employed to be eligible.  It also would have made it unlawful to discriminate against applicants because of their status as unemployed.

AB 889 (domestic employee wage and hour requirements): This bill would have placed onerous wage and hour requirements (including relieving employees of duty for meal and rest breaks) on employers of domestic services employees (e.g. babysitters and nannies).

New laws take effect January 1, 2013 unless otherwise noted.  Employers should review their personnel policies and procedures to ensure compliance with these new laws and to minimize risk and exposure to lawsuits, particularly in the area of wage statement compliance  and personnel records inspection.

California Expands Religious Accommodation Requirements

California's Governor has signed into law AB 1964, which modifies California's Fair Employment and Housing Act's provisions relating to employment discrimination based on one's religious beliefs.  FEHA has always prohibited discrimination against applicants and employees based on their religious beliefs, and has also required reasonable accommodation of employees' religious beliefs and observances, so this much is not new.  The new law makes clear that "religious beliefs" include religious dress practices and religious grooming practices, meaning that employers cannot discriminate against applicants or employees bases on these practices and must also reasonably accommodate such practices in the workplace.  According to the new law, “religious dress practice” shall be construed broadly to include the wearing or carrying of religious clothing, head or face coverings, jewelry, artifacts, and any other item that is part of the observance by an individual of his or her religious creed.  “Religious grooming practice” shall be construed broadly to include all forms of head, facial, and body hair that are part of the observance by an individual of his or her religious creed.  The new law further explains, in pertinent part, that it is an unlawful employment practice:

(l)  (1)  For an employer or other entity covered by this part to refuse to hire or employ a person or to refuse to select a person for a training program leading to employment or to bar or to discharge a person from employment or from a training program leading to employment, or to discriminate against a person in compensation or in terms, conditions, or privileges of employment because of a conflict between the person’s religious belief or observance and any employment requirement, unless the employer or other entity covered by this part demonstrates that it has explored any available reasonable alternative means of accommodating the religious belief or observance, including the possibilities of excusing the person from those duties that conflict with his or her religious belief or observance or permitting those duties to be performed at  another time or by another person, but is unable to reasonably accommodate the religious belief or observance without undue hardship, as defined in subdivision (t) of Section 12926, on the conduct of the business of the employer or other entity covered  by this part.  Religious belief or observance, as used in this section, includes, but is not limited to, observance of a Sabbath or other religious holy day or days, reasonable time necessary for travel prior and subsequent to a religious observance, and religious dress practice and religious grooming practice as described in subdivision (p) of Section 12926.  (2)  An accommodation of an individual’s religious dress practice or religious grooming practice is not reasonable if the accommodation requires segregation of the individual from other employees or the public.

While AB 1964's changes to FEHA arguably are intended simply to clarify existing law, the express modification of FEHA and highlighting of religious discrimination issues may lead to increased focus and scrutiny in this area and, thus, a greater likelihood of religious discrimination suits against employers.  The full text of AB 1964 is here.

Legislative Update:  Proposed Employment Legislation Pending in California

California employers may want to be aware of a number of employment-related bills still pending before the California Legislature, each of which is listed below.  This list does not include employment bills that have already died in various committees during this legislative session.  Pending bills must be passed by each house by August 31.  After that, the Governor has until September 30 to sign or veto the legislation.

AB 2386:  This bill would expand the definition of “sex” under the Fair Employment and Housing Act to include breastfeeding and medical conditions relating to breastfeeding, making discrimination on those grounds a violation of FEHA with a correlating private right of action.

AB 2373:  This bill would add a new section to the Labor Code setting forth 17 factors to consider to determine whether a worker is an employee or an independent contractor.  The enumerated factors are similar to those employed by California courts analyzing independent contractor/employee status.

AB 1450:  This bill would make it unlawful for an employer to exclude from the applicant pool or refuse to hire someone based on their unemployed status.  It would also prohibit job advertisements stating that current employment is a requirement for consideration for the job.

AB 1999:  This bill would add “family caregiver status” as a protected class under FEHA, thereby prohibiting discrimination in employment against a person based on the person being a family caregiver.  For purposes of the legislation, “family caregiver” is defined as an individual who provides medical or supervisory care for a child, parent, spouse, domestic partner, parent-in-law, sibling, grandparent or grandchild.

AB 2039:  This bill would expand the circumstances under which employees could take leave under the California Family Rights Act (CFRA) by (1) eliminating current age and dependency requirements from the definition of “child,” thereby permitting an employee to take leave to care for an adult child, (2) expanding the definition of “parent” to include parents-in-law, and (3) permitting an employee to take leave to care for a grandparent, sibling, or grandchild.

AB 1844:  This bill would prohibit an employer from requiring or requesting that an employee or applicant disclose user name or password information for personal social media, or to divulge any personal social media.

SB 1255:  This bill would specify circumstances under which “injury” would be presumed to an employee as a result of an employer not providing wage statements, or providing incomplete wage statements.  Presumed injury would allow the employee to recover penalties and/or actual damage.  Presumed injury could be shown by the failure to provide a wage statement at all, or by the failure to include the employee's name and last 4 digits of the social security number.  It could also be shown by failing to provide complete wage information, causing the employee to be unable to determine (from the statement alone) gross and net wages earned, deductions therefrom, and the name and address of the employer.

AB 1744:   This bill would require temporary services employers to include additional information on itemized wage statements for employees, including the rate of pay for each assignment, the name and address of the entity that secured the services and total hours worked for each entity.

AB 2674:  This bill would amend section 1198.5 of the Labor Code relating to employee rights to inspect personnel files.  The bill would require employers to maintain employee personnel files for at least 3 years following termination of employment, and to permit current and former employees (or their designated representatives) to inspect and copy personnel records, within 30 days of a request to do so by the employee.  The bill specifies that an employer is not required to comply with more than 50 (whaaat?) requests for copies of personnel records by a representative of employee(s) in one calendar month.

AB 1964:  This bill would add to the current requirement under FEHA that employers reasonably accommodate religious beliefs and observances of employees, by specifying that a religious dress practice or grooming practice are covered “beliefs and observances.”

AB 1875:  While not technically an employment bill, this bill would impact employment litigation by limiting depositions in state court cases to 7 hours (as is the limitation in federal court).

As you can see, most if not all of these bills have the effect of adding new prohibitions on employment actions and increasing burdens on California employers, simultaneously giving rise to new potential legal claims for violations.  Bills that aimed to reduce burdens on California employers, add flexibility to the workplace, and/or reduce litigation were largely killed by the California Legislature.  We will continue to keep you updated on the progress of these bills as the close of the legislative session nears.

Editor
Cal Labor Law

Robin E. Largent is a Partner in CDF’s Sacramento office and may be reached at 916.361.0991 or rlargent@cdflaborlaw.com BIO »

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