2020 has been another banner year for California employment laws, with legislation and Cal/OSHA rulemaking associated with COVID-19 prevention and reporting taking center stage. In our annual update of new employment laws impacting California private sector employers, we lead off with California’s COVID-19 related laws, given their far-reaching impact on the state’s workforce during the pandemic as employers continue to implement measures to prevent the spread of COVID-19 in the workplace. We have also addressed other substantive legislative developments, particularly in the areas of wage and hour law and reporting of employee pay data. Unless otherwise indicated, these new laws will take effect on January 1, 2021.
Temporary Emergency COVID-19 Prevention Rule Not to be outdone by Virginia OSHA, Oregon OSHA or Michigan OSHA, Cal/OSHA adopted an onerous COVID-19 specific temporary emergency regulation effective November 30, 2020. Below is a detailed summary of how we got here, as well as an outline of what the rule requires.
On November 19, 2020, the California’s Occupational Safety and Health Standards Board (Standards Board) voted unanimously to adopt an Emergency COVID-19 Prevention Rule following a contentious public hearing with over 500 participants in attendance (albeit virtually). The Emergency Rule was then presented to California’s Office of Administrative Law for approval and publication. The Rule brings with it a combination of requirements overlapping with and duplicative of already-existing state and county requirements applicable to employers, as well as a number of new and, in some cases, very burdensome compliance obligations.
The Standards Board’s emergency rulemaking was triggered last May with the submission of a Petition for an emergency rulemaking filed by worker advocacy group WorkSafe and National Lawyers’ Guild, Labor & Employment Committee. The Petition requested the Board amend Title 8 standards to create two new regulations – the first, a temporary emergency standard that would provide specific protections to California employees who may experience exposure to COVID-19, but who are not already covered by Cal/OSHA’s existing Aerosol Transmissible Diseases standard (section 5199, which applies generally to healthcare employers); and the second, a regular rulemaking for a permanent infectious diseases standard, including novel pathogens such as SARS-CoV-2. Note that emergency rulemakings are rare and must meet a high threshold designed to allow this abbreviated process; only when a true emergency necessitates this process.
On September 17, 2020, the Standards Board accepted the Division of Occupational Safety and Health’s (Division) recommendation that the Petition be approved, finding that an emergency regulation “would strengthen, rather than complicate, [the Division’s] enforcement efforts” and issued a decision granting (in part) WorkSafe’s Petition. While the Board did not agree to implement the specific proposed emergency regulation advanced by WorkSafe, it did instruct DOSH to work with Board staff to submit a new proposal for an emergency regulation.
Ultimately, the Standards Board published the Division’s proposed emergency rule on November 12, 2020, giving the public only five days to comment on the 100-page rulemaking package. Conn Maciel Carey worked with a coalition of California and national employers to quickly evaluate the proposed emergency rule and develop comments that raised a number of serious concerns, not only about the substance of the rule, but also about the extremely rushed nature of the rulemaking process, which afforded the regulated community no real opportunity for meaningful input, and the Standards Board essentially no opportunity to consider comments.
Nonetheless, after a contentious public hearing, the Standards Board unanimously voted to adopt the Emergency Rule and the rule was approved by the Office of Administrative Law, California’s final gatekeeper for new regulations.
Below is an outline of the Rule and a detailed list of the compliance obligations imposed on most California employers:
At the heart of this emergency rulemaking is the requirement that employers develop a written COVID-19 prevention program consisting of well-established elements, such as physical distancing; face coverings; engineering and administrative controls; personal protective equipment (PPE); excluding from the workplace positive and exposed employees; return to work protocols; training; and employee communication. Consistent with California’s Injury and Illness Prevention Program requirements, employers must also conduct workplace COVID-19 hazard assessments, adopt procedures for investigating and responding to every positive case, and develop procedures for correcting the hazards they identify. The rule also includes detailed reporting and recordkeeping mandates.
Additionally, California has adopted a series of unique requirements in the event of outbreaks (3 or more cases in 14 days) and major outbreaks (20 or more cases in 30 days), which include logistically challenging mandatory testing and mitigation measures.
The 11 required elements of an employer’s CPP include:
Note that the Division has issued answers to “Frequently Asked Questions” (FAQs) seeking to address concerns over the rule’s ambiguity and inconsistency, for example, over the meaning of “exposed workplace” for outbreak purposes. We anticipate the Division will continue to update the FAQs over time.
COVID-19-Related Reporting Mandates (AB 685 and SB 1159)
Legislation enacted earlier in the year has overlapped to a degree with the emergency COVID-19 rule, and the Division is expected to update FAQs to address inconsistencies between Assembly Bill 685 and the temporary emergency COVID-19 rule.
AB 685 requires employers to report to the local public health agency, within 48 hours, any “COVID-19 outbreak.” Under the California Department of Public Health’s (CDPH) guidance, an outbreak is considered three or more laboratory-confirmed cases of COVID-19 among employees who live in different households within a two-week period. CDPH is required to make the reported information available on its website allowing the general public to “track the number and frequency of COVID-19 outbreaks and the number of COVID-19 cases and outbreaks by industry.”
In addition to reports to local public health agencies, AB 685 requires employers to provide written notice to employees, as well as the employer of any subcontracted workers, who were at the same worksite during the infectious period as any employee testing positive for COVID-19 and “may have been exposed to COVID-19.” This written notice must contain specific categories of information and be received by the employee within one business day “in a manner the employer normally uses to communicate employment-related information.” AB 685 also requires notice to the potentially exposed employee’s “exclusive representative” containing the same information as would be required in an incident report per a Cal/OSHA 300 injury and illness log.
Whether an employee “may have been exposed to COVID-19” is undefined, but the Division’s current FAQs indicate that notice must be provided to all employees “who were on the premises at the same worksite as the person who was infectious with COVID-19 or who was subject to a COVID-19-related quarantine order.”
Additionally, Senate Bill (SB) 1159 was signed into law, effective September 17, 2020, impacting the handling of California workers’ compensation claims for COVID-19 illnesses. The law creates a “disputable presumption” that a COVID-19-related illness is compensable for workers’ compensation purposes essentially where (1) the employee has tested positive for COVID-19 during an “outbreak” at the employee’s place of employment and within 14 days after a day that the employee was in the workplace; and (2) the employee’s last day in the workplace was on or after July 6, 2020. An “outbreak” exists if within 14 calendar days any of the following has occurred: (1) for an employer with 100 or fewer employees at a specific workplace, 4 employees test positive for COVID-19; (2) for an employer with more than 100 employees at a specific workplace, 4 percent of the employees test positive for COVID-19; or (3) the workplace is ordered closed by the health department or Division due to a risk of COVID-19 infection.
SB 1159 requires that available paid sick leave benefits be used and exhausted before any temporary disability benefits are paid. Also, it is important to note that a COVID-related illness is presumed compensable where it is not rejected by the employer within 45 days of the date the claim form is filed.
Notably, for any employee who has tested positive during an outbreak, the employer must report to its claims administrator, by email or fax, the following information regarding the employee within three business days from when the employer “knows or reasonably should know that an employee has tested positive for COVID-19”:
The claims administrator must then use this reported information to determine if an “outbreak” has occurred for the purpose of administering claims under SB 1159. An employer that fails to provide this report may be cited by the Labor Commissioner and subject to penalties.
Industry-Specific COVID-19 Requirements (AB 2043, AB 2537, SB 275 and AB 2658)
In addition to broad-based legislation, the state has passed COVID-19-specific laws impacting various industries. First, AB 2043 requires the Division to routinely compile and report, via its internet website, information relating to “the subject matter, findings, and results of any investigation by the Division relating to practices or conditions prescribed in the guidance documents or a COVID-19 illness or injury” at a workplace of agricultural employees, as defined. This information must include at least all of the following:
Second, AB 2537 was enacted to mandate specific COVID-19 prevention measures for public and private sector employers providing direct patient in a general acute care hospital, as defined. Beginning April 1, 2021, such employers must maintain a stockpile of the following equipment in the amount equal to three months of normal consumption: (A) N95 filtering facepiece respirators; (B) powered air-purifying respirators with high efficiency particulate air filters; (C) elastomeric air-purifying respirators and appropriate particulate filters or cartridges; (D) surgical masks; (E) isolation gowns; (F) eye protection; and (G) shoe coverings. These employers must also establish and implement effective written procedures for periodically determining the quantity and types of equipment used in its normal consumption.
Similarly, SB 275 requires that, commencing January 1, 2023, or one year after the adoption of specified regulations (whichever is later), health care employers, including clinics, health facilities, and home health agencies, maintain an inventory of new, unexpired PPE for use in the event of a declared state of emergency, and the inventory must be at least sufficient for 45 days of surge consumption, as determined by regulation. Such health care employers must provide an inventory of its PPE to the Division upon request. The law further requires the Department of Industrial Relations to adopt regulations, in consultation with the State Department of Public Health, setting forth requirements for determining 45-day surge capacity levels for a health care employer’s PPE inventory.
Lastly, AB 2658 amends legal protections against retaliation of any employee for refusing to perform work in violation of prescribed safety standards, to define “employee” to include a domestic work employee (except for where the individual’s work is publicly funded). The legal protections are codified under Labor Code sections 6310, 6311 and 6399.7.
SB 973 requires private employers with 100 or more employees to submit an annual report of employee pay data to the California Department of Fair Employment and Housing (DFEH), beginning March 31, 2021 and annually each year thereafter. The SB 973 pay data report is similar to the now suspended federal EEO-1 pay reporting requirement.
The pay data reported to the DFEH must include at least the following information:
The data reports must be submitted in a searchable format. DFEH intends to issue a standard form for employers to use in submitting their pay data reports and provide a submission portal to do so. SB 973 prohibits employees of the DFEH or Division of Labor Standards Enforcement from making public any individually identifiable information submitted to DFEH as a part of the pay data report prior to certain investigation or enforcement proceedings.
The ABC test, introduced by the California Supreme Court’s 2018 Dynamex decision and expanded by last year’s AB 5, has evolved yet again with AB 323 and 2257. Existing law provides that for purposes of the Labor Code, Unemployment Insurance Code, and wage orders of the Industrial Welfare Commission, a worker who performs services for hire is an independent contractor only if the hiring entity establishes each of the following three factors:
Existing law also provides a number of exemptions from the ABC test for specified occupations and business relationships.
AB 323 expands the exemption for newspaper carriers by deleting the condition that a newspaper carrier work under contract either with a newspaper publisher or a newspaper distributor. The bill also extends the exemption period for newspaper carriers to January 1, 2022.
AB 2259 updates a number of existing exemptions, including those for business service providers, referral agencies and business-to-business relationships. The legislation also recognizes various additional exemptions including certain occupations within the performance arts and journalism, professions providing underwriting inspections and other services for the insurance industry, manufactured housing salespersons, workers engaged by an international exchange visitor program, consulting services, animal services, competition judges with specialized skills, licensed landscape architects, specialized performers teaching master classes, registered professional foresters, real estate appraisers and home inspectors, and feedback aggregators.
As was the case with AB 5, the exemptions are numerous and often include various restrictions and conditions that must be met for an exemption to apply. In general, where a worker is covered by an exemption, the determination of employee or independent contractor status is governed by the multi-factor test established by the California Supreme Court’s decision in Borello rather than the ABC test. However, note that some exemptions alter the test that will apply in determining employee or independent contractor status.
Additionally, with the approval of Proposition 22 by voters in the November 3, 2020 election, app-based transportation and delivery drivers are considered independent contractors if they meet a number of conditions, including that the drivers be permitted to determine the hours they work, the requests they accept, and whether they work for other companies. Proposition 22 requires mandates specific to app-based companies including minimum earnings requirements, limits on working hours, certain healthcare subsidies and insurance requirements, as well as anti-discrimination and sexual harassment policies, training requirements, zero-tolerance policies for driving under the influence of drugs or alcohol, and criminal background checks.
On Call Security Guards Subject to Collective Bargaining Agreement (AB 1512)
In its 2016 decision in Augustus v. ABM Security Services, the California Supreme Court concluded that state law prohibits an employer from requiring on-duty and on-call rest periods. AB 1512 creates a limited exception to this general rule for certain security officers through January 2, 2027. Where a registered security services officer is covered by a valid collective bargaining agreement meeting certain conditions, such worker may be required to remain on the premises and on call during rest periods, and may be required to carry and monitor a communication device during rest periods. The collective bargaining agreement must expressly provide for the wages, hours of work, and working conditions of employees, and must expressly provide for rest periods for those employees, final and binding arbitration of disputes concerning application of rest period provisions, premium wages for all overtime hours worked, and a regular hourly rate of pay of not less than one dollar more than the state minimum wage rate. Such security officers must be permitted to restart a rest period as soon as practicable if the officer’s rest period is interrupted. A subsequent uninterrupted rest period satisfies the rest period obligation. Employees who are not allowed to take a rest period must be paid one hour of pay for the missed rest period.
On Call Safety Sensitive Positions Subject to Collective Bargaining Agreement (AB 2479)
AB 2479 creates a similar exception from the general rule that nonexempt employees must be relieved of all duties during rest periods for certain employees in safety-sensitive positions at petroleum facilities, to the extent such employees may be required to carry and monitor a communication device and to respond to emergencies, or remain on the premises to monitor premises and respond to emergencies even during breaks. The exception only applies to employees covered by a valid collective bargaining agreement expressly providing for the wages, hours of work, and working conditions of employees, and for rest periods for those employees, final and binding arbitration of disputes concerning application of rest period provisions, premium wages for all overtime hours worked, and a regular hourly rate of pay of not less than 30 percent more than the state minimum wage rate. If an employee’s rest period is interrupted, another rest period must be authorized. If circumstances do not allow for the employee to take a rest period, the employer must pay one hour of pay for the missed rest period. AB 2479 remains in effect until January 1, 2026.
Reimbursable Expenses for General Acute Care Hospitals (AB 2588)
Current law requires employers to reimburse employees for necessary business expenses. AB 2588 makes explicit that employer-provided or employer-required educational programs or training for an employee providing direct patient care for a general acute care hospital or an applicant for such employment are reimbursable expenses. Employer-provided or employer-required educational programs or training does not include licensing, registration, or certification programs necessary to legally practice in a specific employee classification to provide direct patient care. Likewise, education or training that is voluntarily undertaken by the employees or applicants solely at their discretion is not reimbursable. An employer is prohibited from retaliating against an applicant or employee for refusing to enter into a contract that violates this new provision.
Corporate Disclosures and Successors to Judgment Debtors (AB 3075)
AB 3075 requires a business entity filing a statement of information with the California Secretary of State to disclose whether any officer, director, member or manager has an outstanding final judgment issued by the Division of Labor Standards Enforcement or court of law, for which no appeal is pending, for a violation of any wage order or provision of the Labor Code. This requirement takes effect January 1, 2022, or upon certification by the Secretary of State that its California Business Connect is implemented, whichever is earlier. This law also expressly provides that a successor to any judgment debtor shall be liable for any wages, damages and penalties owed to the judgment debtor’s former workforce pursuant to a final judgment. Lastly, the law makes explicit that local jurisdictions may enforce local standards relating to the payment of wages that are more stringent than state standards.
Public Works Contracts for Charter School (AB 2765)
Existing law defines “public works” for the purpose of regulating public work contracts, including the payment of prevailing wages for workers employed on such projects. AB 2765 expands the definition of “public works,” for the purpose of prevailing wage payments, to include construction, alteration, demolition, installation, or repair work done under private contract on a project for a charter school, as defined, when the project is paid for with proceeds of conduit revenue bonds issued on or after January 1, 2021.
In last year’s legislative update, we addressed AB 749 barring any agreement to settle an employment dispute from containing a provision “prohibiting, preventing or otherwise restricting” the employee from obtaining employment with the employer or “any parent company, subsidiary, division, affiliate or contractor of the employer.” This year, AB 2143 adds an exception permitting no rehire clauses where the employee engaged in criminal conduct. Therefore, two exceptions to the no-rehire provision exist where either: (1) a good faith determination was made of sexual harassment or sexual assault before the aggrieved party filed its claim against the employer, or (2) a good faith determination of criminal conduct was made before the aggrieved party filed its claim.
AB 1947 extends the statute of limitations under Labor Code section 98.7 for an employee to file a discrimination complaint with the California Labor Commissioner, from six months to one year after the employee was “discharged or otherwise discriminated against.” AB 1947 also amends Labor Code section 1102.5 to authorize the court to award reasonable attorneys’ fees to an employee who prevails in demonstrating that their employer violated these provisions against retaliation. Section 1102.5 specifically prohibits employers from, among other actions, retaliating against an employee who has disclosed information that the employee believes supports a legal violation to a government agency, or an employee with authority to investigate, discover or correct the alleged violation.
Kin Care (AB 2017)
Existing law requires California employers to allow employees to take up to half of their accrued sick leave to care for a family member, as defined, under what is commonly referred to as “kin care.” AB 2017 clarifies that the designation of such sick leave “shall be made at the sole discretion of the employee.”
Expanding Paid Family Leave to Include Military Service (AB 2399)
AB 2399 expands paid family leave to cover qualifying military service. Under the state disability insurance program, employees may be eligible for Paid Family Leave that replaces wages and benefits to employees who take time off work to care for a seriously ill family member or to bond with a minor child within one year of birth of placement. Beginning January 1, 2021, covered California employees will also be able to take paid family leave to participate in a qualifying exigency related to the covered active duty or call to covered active duty of the covered employee’s spouse, domestic partner, child, or parent in the United States Armed Forces. AB 2399 requires the same documentation as existing law to qualify for leave—a copy of the new active duty order or other documentation issued by the military.
Expanded Protections for Crime Victims (AB 2992)
AB 2992 expands protections for employees who are victims of crime. Existing law prohibits an employer with 25 or more employees from discharging, discriminating, or retaliating against an employee who is a victim of domestic violence, sexual assault, or stalking for taking time off work to obtain or attempt to obtain relief to help ensure the health, safety, or welfare of the victim or the victim’s child. AB 2992 clarifies that these protections apply to all victims of a crime who must miss work, either planned or otherwise, (1) to seek medical attention for injuries caused by the crime or abuse, (2) to obtain services from prescribed entities because of the crime or abuse, (3) to obtain psychological counseling or mental health services related to the crime or abuse, and (4) to participate in safety planning and take other actions to increase safety from future crime or abuse.
Please contact us with any questions about this update.
Last Updated December 23, 2020
A printable version of the Client Alert is available here. ________________________________________________________________________________________________________
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