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California Legislative Updates for August and September 2020

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Legislative update prepared by ThinkHR and is not to be considered legal advice.

California Law Alerts – September 2020

Settlement Agreements in Employment Disputes

On September 11, 2020, California Governor Gavin Newsom signed legislation (AB 2143) regulating settlement agreements in employment disputes involving an aggrieved person and their employer. The law bars agreement provisions restricting the settling aggrieved person from future employment with the settling employer or any parent company, subsidiary, division, affiliate, or contractor of the employer. Any agreement made in violation of this protection on or after January 1, 2020, is void. However, the law does not:

  • Preclude the employer and aggrieved person from making an agreement to:
    • End a current employment relationship; or
    • Prohibit or restrict the settling aggrieved person from future employment with the settling employer, if the employer made and documented a good faith determination, before the person filed their claim, that the person engaged in sexual harassment, sexual assault, or any criminal conduct.
  • Require an employer to continue to employ or rehire a person if there is a legitimate non-discriminatory or non-retaliatory reason for their termination or refusal to rehire.

COVID-19 Supplemental Paid Sick Leave Expanded

On September 9, 2020, California Governor Gavin Newsom signed legislation (AB 1867) codifying Executive Order N-51-20, as detailed in our California Law Alerts – April 2020, which:

  • Mandates that a food employee working in any food facility must be permitted to wash their hands every 30 minutes as needed; and
  • Makes the COVID-19 food sector supplemental paid sick leave effective until December 31, 2020, or when any federal extension of the Emergency Paid Sick Leave Act (EPSLA) established by the Families First Coronavirus Response Act (FFCRA) expires, whichever occurs later.

The law also creates a new entitlement to COVID-19 supplemental paid sick leave for persons employed as health care providers or emergency responders. This new entitlement is also effective until December 31, 2020, or when any extension of the EPSLA expires, whichever occurs later. According to the Governor’s message, the law closes the gaps between paid sick days provided in federal law and the Governor’s Executive Order. The law now includes employers with over 500 employees as well as all employers of first responders and health care employees who opted not to offer coverage under federal law. The Labor Commissioner can cite workplaces for a lack of paid sick days under the expanded law.

Worker Classification Exemptions

On September 4, 2020, California Governor Gavin Newsom signed legislation (AB 2257) expanding the exemptions to the state’s ABC test, which is used to determine whether an individual is an employee or an independent contractor (worker classification) under the California Labor Code, Unemployment Insurance code, and Industrial Welfare Commission wage orders.

Under the ABC test, paid workers must be classified as employees — not independent contractors — unless the hiring entity can demonstrate all of the following:

  1. They are free from the control and direction of the hiring entity regarding the work they perform, in practice and under their contract (e.g., they make their own schedule, do not answer to a supervisor, perform duties according to their own custom).
  2. They perform work that is outside the usual course of the hiring entity’s business (e.g., they are a baker, but for a company that does not specialize in baking).
  3. They are customarily engaged in an independently established trade, occupation, or business of the same nature as that of the work performed for the hiring entity (e.g., they mostly earn income by baking, and that’s exactly what they’re doing for the hiring entity).

Additionally, the law now exempts certain occupations from the ABC test and instead applies the multifactor Borello test (see question #5), which considers several independent factors in determining employment status. Workers exempt from ABC but considered under Borello include:

  • Musicians or musical groups for single-engagement live performance events, under specific terms and conditions.
  • Individual performance artists presenting original, creative work that is unique to only their invention, imagination, or talent.
  • Still photographers, photojournalists, videographers, or photo editors under a written contract with specific terms along with the services they provide to digital content aggregators.
  • Fine artists, freelance writers, translators, editors, content contributors, advisors, narrators, cartographers, producers, copy editors, illustrators, or newspaper cartoonists under a written contract with specific terms.
  • People who provide underwriting inspections and other services for the insurance industry.
  • Manufactured housing salespersons, subject to certain obligations.
  • International exchange visitor program workers.
  • Consultants providing substantive advice that requires their discretion and independent judgment, which is based on their own expertise of a particular subject or field of study.
  • Animal services related to daytime and nighttime pet care including pet boarding.
  • Competition judges with specialized skills.
  • Licensed landscape architects.
  • Specialized performers teaching master classes.
  • Registered professional foresters.
  • Real estate appraisers and home inspectors.
  • Feedback aggregators.

The law also:

  • Creates an exemption for business-to-business relationships between two or more sole proprietors. Instead, worker classification is determined by Cal. Labor Code § 2750.5 and by Borello.
  • Revises referral agency exemption criteria and clarifies that referrals for services do not include high hazard industry services and janitorial, delivery, courier, transportation, trucking, agricultural labor, retail, logging, in-home care, or construction services other than minor home repair.

The ABC test and the Borello test both assume that the worker is an employee. The hiring entity must prove that the worker is an independent contractor to make that classification. Under the ABC test, if a hiring entity cannot demonstrate any part of the three-part test then the worker is not an independent contractor. Under the Borello test, no single factor determines whether a worker is an employee or an independent contractor. Instead, courts consider all potentially relevant factors on a case-by-case basis according to the nature of the work, the overall arrangement between the parties, and the purpose of the law. 

The law took effect September 4, 2020.

California Law Alerts – August 2020

Legislative Update: Protecting Outdoor Workers Exposed to Smoke from Wildfires

The California Division of Occupational Safety and Health (Cal/OSHA) requires employers to comply with worker safety requirements that protect outdoor workers from harmful wildfire smoke chemicals, gases, and fine particles. Per emergency regulation section 5141.1, Protection from Wildfire Smoke, employers with workplaces and operations where the current Air Quality Index (AQI) for PM2.5 particulate is 151 or greater must determine their employee exposure to PM2.5 before each shift and periodically thereafter as needed by the following methods:

Employers must take the following measures to protect workers when the current AQI is 151 or greater:

  • Implement a system for communicating wildfire smoke hazards in a form readily understandable by all affected employees, including provisions designed to encourage employees to inform the employer of wildfire smoke hazards without fear of reprisal.
  • Train employees according to section 5141.1 Appendix B.
  • Implement engineering controls, when feasible, to reduce employee exposure to PM2.5 to less than a current AQI of 151 (or as low as feasible if less than a current AQI of 151 cannot be achieved). Examples include providing employees filtered air workplaces such as enclosed structures or vehicles.
  • Implement changes to work procedures or schedules whenever engineering controls are not feasible or do not reduce employee exposures to PM2.5 to less than a current AQI of 151. Examples include changing employee work schedules or locations.
  • Provide proper respiratory protection equipment, such as disposable filtering facepiece respirators (dust masks), other half facepiece respirators, or full facepiece respirators*. See below.
  • Provide respirators for employee use on a voluntary basis when the current AQI for PM2.5 is equal to or greater than 150 but less than 500. Employers must require employees to use respirators when the current AQI for PM2.5 is greater than 500.

If the current AQI is less than 151, the employer may provide filtering facepiece respirators (dust masks) to employees or allow employees to bring their own. Read more about these protections and more on the Cal/OSHA website.

*To filter out fine particles, respirators must be labeled N-95, N-99, N-100, R-95, P-95, P-99, or P-100, and must be labeled as approved by the US National Institute for Occupational Safety and Health (NIOSH). Full facepiece respirators provide at least five times as much protection from fine particles as half facepiece respirators such as filtering facepiece respirators (dust masks).

Local Emergency Paid Sick Leave

The following California localities enacted an emergency paid sick leave during, and generally effective for the duration of, the COVID-19 pandemic:

California Consumer Privacy Act Final Regulations

On August 14, 2020, the California Consumer Privacy Act (CCPA) final regulations were approved and took immediate effect. Signed into law on June 28, 2018, the CCPA was amended twice in 2019 and took effect on January 1, 2020. The CCPA grants California consumers data privacy rights, control over their personal information, and the right to know, delete, and opt-out of the sale of personal information that businesses collect. They also establish compliance procedures, legal rights, along with transparency and accountability mechanisms for covered businesses. 

Sexual Harassment Prevention Training for Supervisors

On August 4, 2020, the California Department of Fair Employment and Housing released sexual harassment and abusive conduct prevention training for supervisory employees. This training meets the legal requirement that employers with five or more employees provide at least two hours of sexual harassment prevention training and education to all supervisory employees in California by January 1, 2021.

The law also requires nonsupervisory employees to receive one hour of sexual harassment and abusive conduct prevention training, which must include practical examples of harassment based on gender identity, gender expression, and sexual orientation.

Employers must also:

  • Retain a record all employees’ training for a minimum of two years;
  • Provide training every two years; and
  • Provide the department’s sexual harassment prevention poster or fact sheet.

COVID-19 and Safe Reopening

On July 31, 2020, the California Department of Public Health updated its COVID-19 Employer Playbook For a Safe Reopening to require employers to contact the local health department in any jurisdiction where an employee lives when there is a COVID-19 workplace outbreak. An outbreak is three or more laboratory-confirmed cases of COVID-19 within a two-week period among employees who live in different households.

The updated guide also:

  • Aligns the minimum criteria for return to work with Centers for Disease Control and Prevention guidance; and
  • Includes a new table for employers that are considering whether to temporarily suspend operations due to a COVID-19 infection.

Read more about how businesses can protect their workers and customers on the department’s website.

Updated COVID-19 Guidance

On July 24, 2020, the California Department of Fair Employment and Housing released an updated guidance for employers about COVID-19 addressing:

  • Civil Rights During a Pandemic: Civil rights laws are in effect during a pandemic, the Fair Employment and Housing Act (FEHA) prohibits discrimination in the workplace based on an individual’s protected status, which includes a medical condition. However, a medical condition is defined under the act as any health impairment related to or associated with a diagnosis, record, or history of cancer or genetic characteristics.
  • COVID-19 Inquiries and Protective Equipment: Employers may ask all employees entering the workplace if they have COVID-19 symptoms and may take their temperatures before allowing entrance. Employers may also:
    • Require employees to submit to viral testing but not antibody testing before permitting entrance.
    • Ask why an employee did not report to work but if an employee discloses an illness or medically-related reason for their absence it must be maintained as a confidential medical record.
    • Require employees to wear personal protective equipment during COVID-19 pandemic and if they need a reasonable accommodation (such as non-latex gloves, gowns for individuals who use wheelchairs) it should be provided, absent undue hardship.
  • Employees with COVID-19 Symptoms or Infection: The very limited information an employer may reveal if an employee is quarantined, tested positive for COVID-19, or came in contact with someone with the virus. Employers may also:
    • Send employees who exhibit COVID-19 symptoms home because, per the federal Centers for Disease Control an employee with COVID-19 is unable to perform their essential duties in a way that would not endanger the health or safety of others in the workplace even with a reasonable accommodation.
    • Send employees home if they test positive for COVID-19
  • Job-Protected Leave: Employee entitlements to job-protected leave under the California Family Rights Act (CFRA), appropriate healthcare professional certification when CFRA leave is needed, and that COVID-19 qualifies as a serious health condition under the CFRA if it results in inpatient care or continuing treatment/supervision by a healthcare provider (or leads to conditions like pneumonia).
  • Reasonable Accommodations for Employees with a Disability/Vulnerable Populations: Reasonable accommodations for a disability when an employee cannot go to work because of an illness related to COVID-19 or when an employee has a medical condition that increases their risk for severe illness from COVID-19. Additionally, regarding reasonable accommodations:
    • Employees who are vulnerable to severe illness from COVID-19 due to age are not entitled to a reasonable accommodate, based on their age, because age is not a disability and employers are not required to reasonably accommodate employees based on age alone.
    • Remote work accommodations, or taking leave because of a COVID-19 disability, and medical documentation.
    • Reasonable accommodations must continue to be provided for employees with disability that are unrelated to the pandemic, barring undue hardship.

About the Author

  • ThinkHR combines the best in live advisor expertise with innovative technology and comprehensive and instructional content to help organizations address all potential people risks, including guidance on preparing for and managing those risks. Our industry-leading People Risk Management solution (PRM) helps our partners strengthen their client relationships and win more business. HR professionals use our tools to be more effective in their roles, while all employers benefitting from the crisis averted with our end-to-end people risk management solution. Located in the San Francisco Bay Area, ThinkHR serves over 1,000 partners, including many of the largest insurance brokerage firms in the U.S., multiple payroll vendors, and insurance carriers. We also provide our PRM solution to more than 270,000 businesses employing millions of people across the nation. Founded in 2005 by insurance, HR, and technology veterans, we enable our partners to easily integrate HR knowledge into their products and services for human capital management (HCM), thus accelerating their time to market and increasing value to their customers. ThinkHR’s PRM features hundreds of thousands of answers to HR compliance issues, plus in-depth training courses, newsletter content, HR tools, and an employee handbook builder – all of which are supported by access to live advisors who help HR and business leaders manage complex workforce issues. ThinkHR is backed by Guidepost Growth Equity. For more information, Request a Consultation and we’ll get right back to you. CalNonprofits Insurance Services provides a complimentary subscription to ThinkHR for all members of CalNonprofits (the California Association of Nonprofits).

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