California Labor Commissioner Gives Insight into 2022’s Warehouse Distribution Quota Law

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On September 22, 2021, Governor Newsom signed AB 701, which creates new obligations for certain employers with warehouse distribution centers that use production quotas, effective January 1, 2022.  Under this new law, employers with at least 100 employees at a single warehouse distribution center in California, or at least 1,000 employees at one or more warehouse distribution centers in California, must provide their employees with a written description of the quotas they are expected to meet.  In counting employees, an employer must include workers provided through the services of a third-party employer, temporary service, or staffing agency or similar entity, if the employer employs or exercises control over the wages, hours, or working conditions of those workers.  Check out Desiree Ho’s original post for the details.

This week, the California Labor Commissioner’s office posted an FAQ providing its view on some of the details.  Of import, by January 31, 2022, employers must provide to each employee a written description of each required quota, including the number of tasks to be performed or materials that must be produced or handled within a time period, and any potential adverse employment action that could result from failing to meet the quota.  And, such information must be given to new employees when hired.

Employers may have to reevaluate 2021 quotas as the new law does not permit a quota that prevents compliance with meal or rest periods, use of bathroom facilities (including reasonable travel time to and from bathrooms), or compliance with occupational health and safety standards.

The Labor Commissioner identifies one example of an unlawful quota if it “requires that employees always be engaged in productive activity during work hours” as it “would directly prevent employees from taking meal and rest periods, and prevent them from using bathroom facilities during work hours or exercising their rights regarding health and safety standards.”

Also, be aware that the FAQ highlights that employees and former employees may request written descriptions of their quotas and “a copy of their most recent 90 days of their personal-work-speed data” which must be provided within 21 days.

If you need legal guidance revising quotas, responding to requests for information from employees, former employees or their counsel, please contact your favorite CDF lawyer to ease the process.