Important Legislative Developments
Topics: New Laws & Legislation
A.On May 15, 2006, Governor Schwarzenegger signed SB 144 into law (revised food and safety code). SB 144 was sponsored by the California Restaurant Association and a broad coalition of interested parties that overhauled California's entire food and safety code in an effort to improve food safety for consumers and eliminate bureaucratic red tape for businesses. SB 144 will enact the updated California Retail Food Code (California Code) and repeal the existing California Uniform Retail Food Facilities Law (CURFFL). SB 144 consolidates food safety regulations and makes them more user friendly, provides better uniformity and consistency, updates and uses the best available science to ensure Californians are safe, and provides businesses with greater flexibility.
B.Currently pending: AB 2095 (sexual harassment prevention training for managers). This bill would limit the provisions regarding mandatory sexual harassment prevention training to employers having 50 or more employees in California and would limit the training requirement to supervisory employees within California. Please see our firm blog for more details about this pending bill.
C.Currently pending: AB 2186 (misclassification of employees as independent contractors). Existing law prescribes comprehensive requirements relating to minimum wages, overtime compensation, and standards for working conditions for the protection of employees applicable to an employment relationship. This bill would state the intent of the Legislature to prohibit deliberate misclassification of employees as independent contractors to avoid the application of such laws and to penalize intentional misclassification. Employers should assess whether they are controlling the manner and means of the work performed by their contractors' employees, a key factor in determining whether an employment relationship exists. Employers also should take a careful look at their contracts with independent contractors to ensure that (1) their contractors must comply with all laws, including wage-and-hour laws, and must insure that their subcontractors also comply with all applicable laws, and (2) they have strong indemnification language in the event they are sued for violations of the law by their contractors or subcontractors.
D.Currently pending: AB 2217 and SB 1254 (expansion of alternative workweek arrangements). Two bills have been introduced in the California legislature that would allow employees greater flexibility in scheduling their workweek. These bills would allow individual workers to request and their employers to mutually agree to a compressed workweek that comprises of four 10-hour days. Any work performed beyond the compressed work schedule would remain subject to current state overtime rules. Please see our firm blog for more details about this pending bill.
E.Currently pending: AB 2371 (employment arbitration agreements). Existing law provides that written agreements to submit controversies to arbitration are valid and enforceable. This bill would invalidate arbitration agreements between employers and employees that relate to employment practices covered by the Fair Employment and Housing Act (FEHA) that are required as a condition of hiring. It would further establish that on and after January 1, 2008, any waiver of rights or procedures under the FEHA must be knowing, voluntary, and not made as a condition of hiring. The bill also provides that an employer has the burden to prove that a waiver or arbitration agreement was knowing, voluntary, and not a condition of employment or continued employment. If passed, this bill would undermine an employer's ability to enter pre-dispute arbitration agreements with employees regarding any rights covered by FEHA.
F.Currently pending: SB 300 (family and medical leave). This bill would increase the circumstances under which an employee is entitled to protected leave pursuant to the Family Rights Act by (1) eliminating the age and dependency elements from the definition of "child," thereby permitting an employee to take protected leave to care for his or her independent adult child suffering from a serious health condition, and (2) permitting an employee to take leave to care for a seriously ill grandparent, sibling, or domestic partner, as defined.
G.Currently pending: SB 1414 (large employer healthcare mandate). Following the lead of Maryland, California State Senator Carole Migden, D-San Francisco, has introduced a bill that would require businesses with 10,000 or more employees to spend at least 8 percent of total wages on health benefits. It has been reported that this bill would affect approximately 69 employers in California, and is being drafted with Wal-Mart in mind. Maryland passed a similar law in January, and at least 30 other states are planning to introduce similar legislation. Senator Migden argues that many employers who do not provide health benefits to their employees are placing the burden on the government to fill this need. The Retail Industry Leaders Association has filed suit to challenge the Maryland law, arguing the law violates the commerce clause, the equal-protection clause of the U.S. Constitution, and the Employee Retirement Income Security Act (ERISA). As you may recall, in 2004 California voters narrowly rejected Proposition 72, which would have required employers with 20 or more employees to provide health benefits to employees or to pay a fee to the medical insurance board that would provide insurance to individuals. There is no doubt that employers in California will have to carefully watch this issue and communicate with their elected representatives the impact that such a requirement would have on their businesses. Although this bill is targeted at the large employers, passage of this type of legislation would pave the way for mandatory employee health benefits for all employers.