We recently blogged about Governor Brown signing S.B. 1241, which is now codified as Section 925 of the California Labor Code. The law, which affects venue and choice of law provisions in agreements entered into as a condition of employment, will begin applying to agreements entered into, modified, or extended beginning on January 1, 2017. The text of the law (posted directly below) might appear relatively straight forward, but certain ambiguities and questions concerning the law’s implementation raise several issues, which are discussed in this blog post.
We invite you to review our newly-posted October 2016 California Employment Law Notes, a comprehensive review of the latest and most significant developments in California employment law. The highlights include:
Newly Enacted California Statutes
- Minimum Wage Increases;
- Equal Pay Act Expanded;
- No Disclosure Of Juvenile Criminal History Required (Including Rape And Murder);
- California Employees Guaranteed Access To California Law And Forum;
- All-Gender Restrooms;
- Pay Stub Reform For Exempt Employees;
- Notification Regarding Earned Income Tax Credit Expanded;
- Bond Required To Challenge Labor Commissioner Rulings;
- Domestic Worker Bill Of Rights Made Permanent;
- In-Home Supportive Services Workers Entitled To Paid Sick Leave;
- Immigration-Related Protections Expanded;
- DFEH May Receive And Prosecute Complaints From Victims Of Human Trafficking;
- New California State Contractor Requirements;
- Actors’ Online Age Disclosures Restricted;
- Paid Family Leave Benefits Increased;
- New Notice Regarding Domestic Violence, Sexual Assault And Stalking Protections;
- Settlement Provisions Limiting Disclosure Of Information Regarding Sex Offenses Are Prohibited;
- Indoor Heat Illness Regulations Mandated;
- Clarification Regarding The Use Of Smart Phones While Driving; and
- Additional Workplace Smoking Restrictions.
New Case Law
Around this time last year, Section 1197.5 of the California Labor Code was amended by S.B. 358 in order to “eliminate the gender wage gap in California.” Among other things, the amendment sought to increase wage transparency and made it more difficult for employers to defend against gender-based equal pay claims.
On September 30, 2016, California Gov. Jerry Brown signed S.B. 1063, further expanding the statute to prohibit wage discrimination based on race or ethnicity. The new prohibitions on race and ethnicity discrimination in wages mirror the gender provisions, which were discussed in a previous blog post. For example, race-based wage differentials are exempted (as are gender wage differentials) if they are related to payments based on a seniority system, a merit system, quantity or quality of production, or any bona fide factor other than race.
Employers should note that Gov. Brown also signed A.B. 1676, which specifies that prior salary cannot, by itself, justify any gender disparity in compensation.
S.B. 1063 is codified as Section 1197.5(b) of the California Labor Code, and A.B. 1676 is codified as Section 1197.5(a)(3).
On the heels of North Carolina’s controversial legislation, which requires that people use the public restroom that corresponds to their biological gender rather than the gender with which they identify, California has gone in a different direction.
On September 29, 2016, California Gov. Jerry Brown signed A.B. 1732, which requires all single-user restroom facilities in any business establishment, place of public accommodation, or government agency to be identified as “all gender” facilities rather than being designated as male- or female- only. The law authorizes public inspectors or building officials to inspect facilities for compliance with this law.
This bill will be codified as Section 118600 of the California Health and Safety Code.
The new law goes into effect March 1, 2017. Businesses should immediately look into whether their single-occupancy restrooms need to be re-designated in compliance with the new law.
On September 24, 2016, California Gov. Jerry Brown signed A.B. 1687 – a measure aimed at preventing age discrimination against film, television, and other professionals in the entertainment industry whose ages could be viewed by casting directors and other potential employers. As a result of this bill, industry professionals whose profiles are listed on commercial online entertainment employment service providers (IMDb.comPro and similar sites) can request to have their dates of birth and ages removed from the public’s purview. Upon request, such service providers must remove subscribers’ dates of birth and ages from their online profiles within five days, and also ensure that companion websites under the service provider’s control do the same. These new requirements only apply to service providers who have contractual relationships with subscribers who pay fees.
The bill will be codified as Civil Code section 1798.83.5, and currently contains no provision outlining any penalties for those in violation of the statute or recourse for those allegedly harmed.
Nonetheless, California-based commercial online entertainment employment service providers, as well as out-of-state providers who have California-based subscribers, should be prepared to promptly remove date of birth and age information from subscriber profiles upon request and to require other providers under their control to do the same.
In the past, a California employer could freely inquire about and consider a job applicant’s history of criminal convictions in determining any condition of employment including hiring, promotion, or termination. Although California law prohibited employers from asking about or considering arrests or detentions that did not result in convictions, the law did not impose any restrictions regarding what types of convictions employers could ask about or consider.
That has now changed. On September 27, 2016, California Gov. Jerry Brown signed A.B. 1843, which removes juvenile convictions from the scope of convictions that employers are permitted to ask about or consider. Specifically, the newly signed bill defines “conviction” to exclude an adjudication (i.e. conviction) by a juvenile court. It prohibits an employer from asking a job applicant to disclose information (or seeking information from any source) regarding a juvenile court’s adjudication. The new law also prohibits an employer from considering an adjudication or court disposition by a juvenile court as a factor in determining any condition of employment.
This bill will be codified as Section 432.7 (a) (2) and (3) of the California Labor Code.
Employers should immediately review their employment applications and other employment-related documents to determine whether they should be revised in light of this important new law.
In recent years, some employers doing business in the Golden State have required their employees to sign arbitration and employment agreements that require the employee to sue or arbitrate in – or under the law of – another state. After January 1, 2017, this practice will be illegal unless the employee was represented by legal counsel who assisted in negotiating the out-of-state venue, forum or choice of law terms.
On September 25, 2016, California Gov. Jerry Brown signed S.B. 1241, which regulates where and under what law a California employee may sue or arbitrate. In particular, for claims arising in California for employees who primarily reside and work in the state, employers are prohibited from requiring adjudication of claims in venues or forums outside of California – including both litigation and arbitration – or from depriving employees of the substantive protections of California law. Any contract provision to the contrary is voidable by the employee, who may seek injunctive relief and other available remedies (including attorney’s fees) in California and under California law.
The bill will be codified as Section 925 of the California Labor Code and the new law will apply to any contract entered into, modified, or extended on and after January 1, 2017.
Employers should immediately review any employment and arbitration agreements, handbooks, and other employment-related documents to determine whether they should be revised in light of this important new law.