Governor Newsom is done signing bills for 2023. We briefly summarize the new laws affecting California employers below. Unless noted otherwise, these laws are effective on January 1, 2024.
Equal Employment Opportunity
The Governor signed AB 2188 in the 2022 legislative session. It makes off-duty cannabis use a protected class under California’s Fair Employment and Housing Act. Subject to limited exceptions, employers may not discriminate against employees or applicants who use cannabis off-duty and away from work, and may not refuse to hire an applicant who tests positive for a “nonpsychoactive” cannabis metabolite, or whose criminal history reflects prior cannabis use.
SB 848 requires employers with five or more employees to approve up to five days of unpaid “reproductive loss leave” (but no more than 20 days per year) following a failed adoption, failed surrogacy, miscarriage, stillbirth, or an unsuccessful assisted reproduction.
SB 497 creates a rebuttable presumption of retaliation if an employee is disciplined or discharged within 90 days of engaging in certain protected activity, including, among other things, engaging in lawful off-duty conduct, complaining about their wages, and other whistleblower activity.
California’s Civil Rights Department revised the regulations related to the use of criminal history information under the Fair Chance Act (“FCA”). The revised regulations expand the definition of “applicants” to whom the FCA applies. Employers also must now consider various factors and types of evidence when conducting the post-offer individualized assessment of prior convictions, including applicant rehabilitation and other mitigating circumstances.
SB 553 requires most California employers to establish and implement a workplace violence prevention plan (“WVPP”) by July 1, 2024. The WVPP may be incorporated into an Injury and Illness Prevention Plan, or created as a stand-alone document. Employers must also comply with annual training and recordkeeping requirements, including keeping “violent incident logs” for every workplace violence matter.
SB 428 authorizes employers and collective bargaining representatives to seek a temporary restraining order on behalf of an employee who suffered unlawful violence, the credible threat of violence, or harassment.
Wage and Hour
SB 616 increases the amount of California required paid sick leave (“PSL”) employers must provide to a maximum of five days or 40 hours per year. Employers may cap accruals at no less than 10 days or 80 hours. Employers who use an accrual method other than one hour PSL for every 30 hours worked must ensure employees accrue three days or 24 hours of PSL by their 120th day of employment, and five days or 40 hours by their 200th day of employment.
AB 102 funds and directs the Industrial Wage Commission to reconvene and provide final recommendations for the adoption of new wage orders by October 31, 2024.
AB 594 authorizes public prosecutors to prosecute or enforce, (a) both civil and criminal actions under the Labor Code, and (b) claims of intentional misclassification of employees as independent contractors or exempt. This law will almost certainly increase these types of claims.
Employment Documents, Records, and Notices
SB 699 prohibits employers from entering into or enforcing non-compete agreements of any kind, regardless of where the employee worked and/or where the agreement was signed.
AB 1076 requires employers to send notices to current and former employees, stating that any non-compete agreements they signed are void.
AB 352 requires employers to take certain actions to protect the electronic records of employees’ medical information related to personal reproductive decisions and gender affirming care, including refusing to disclose such information to persons and entities outside of California.
Notable Industry-Specific Bills
SB 525 establishes five separate minimum wage schedules for certain covered health care employees, depending on the nature of the employer, effective June 1, 2024. The bill lists 20 affected facilities, including hospitals, clinics, licensed skilled nursing facilities, mental health facilities, home health agencies, residential care, and more.
AB 1228 establishes the Fast Food Council to set minimum wages and working conditions for fast food restaurants, defined as limited-service restaurants in California that are part of a national fast food chain. The law also sets a $20 minimum wage for fast food workers, effective April 1, 2024.
AB 723 extends to the end of 2025 covered employers’ obligation to recall employees laid-off for reasons related to the COVID-19 pandemic. This obligation applies to employers operating a hotel, private club, event center, airport hospitality operation, airport service provider, or providing building services to office, retail, or other commercial buildings. The law also creates a rebuttable presumption that any employment separation that took place on or after March 4, 2020, due to lack of business, reduction in force, or other economic, non-disciplinary reason, is covered.
Minimum Wage Increases
In addition to industry-specific and local minimum wage increases, California’s minimum wage requirements will increase. All employers must pay at least $16 per hour, and more if a local ordinance imposes a higher minimum wage. Accordingly, the new minimum annual salary for “white collar” exempt employees will be $66,560.
Employers should consult with experienced counsel to help avoid liability under these new requirements.