California Employment Law Update

November 2017 California Employment Law Notes

We invite you to review our newly-posted November 2017 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

New Case Law

California Enacts “Ban the Box” Legislation

On Saturday, October 14, 2017, California Gov. Jerry Brown signed Assembly Bill 1008 into law, which is set to take effect on January 1, 2018.  Known as the “Ban the Box” legislation, in reference to the box applicants are asked to check if they have any prior criminal convictions, the new law prohibits employers with five or more employees from inquiring about or considering a job applicant’s conviction history prior to an offer of employment.

Specifically, the new law amends California’s Fair Employment and Housing Act (FEHA) by making it unlawful for employers in California with five or more employees to include on any application for employment any question that seeks the disclosure of an applicant’s conviction history, to inquire into or consider the conviction history of an applicant until that applicant has received a conditional offer, and, when conducting a conviction history background check, to consider, distribute, or disseminate information related to specified prior arrests, diversions, and convictions.  The law expands existing “Ban the Box” legislation currently in effect in fifteen local jurisdictions, including Los Angeles and San Francisco, to California generally.

Moreover, the new law also requires an employer who intends to deny an applicant a position of employment solely or in part because of the applicant’s conviction history to make an individualized assessment of whether the applicant’s conviction history has a direct and adverse relationship with the specific duties of the job.  In making the assessment, the employer must consider the nature and gravity of the offense or conduct, the time that has passed since the offense or conduct and completion of the sentence, and the nature of the job sought by the applicant.

If the employer, after making this assessment, decides to deny employment, the employer must provide the applicant with written notification of this decision consisting of notice of the disqualifying conviction, a copy of the conviction history report, if any, and an explanation of the applicant’s right to respond to the notice.  The applicant would then have five business days to respond to the notification before the employer may make a final decision.  The employer’s final decision must be issued in writing to the applicant and must contain the final denial or disqualification, any existing procedure the employer has for the applicant to challenge the decision, and notice of the right to file a complaint with the Department of Fair Employment and Housing.

Employer’s Victory In Workers’ Compensation Proceeding Leads To Dismissal Of Discrimination Claims

A recent California Court of Appeal opinion reminds employers of the need to carefully monitor parallel workers’ compensation proceedings involving litigants who also have civil claims pending against the employer. Ly v. County of Fresno, 2017 WL 4546059 (Cal. Ct. App. Sept. 15, 2017).

Three Laotian correctional officers filed Fair Employment and Housing Act (“FEHA”) charges alleging they had been subjected to racial and national origin discrimination, harassment and retaliation. At the same time, they pursued claims before the Workers Compensation Appeals Board (“WCAB”) in which they alleged compensable psychiatric work-related injuries as a consequence of the claimed discrimination. The workers’ compensation judge found for the employer, concluding that the challenged conduct was lawful, non-discriminatory and done in good faith.

After the completion of the WCAB proceedings, the employer filed a motion for summary judgment in the civil discrimination suit the plaintiffs had filed. The trial court granted summary judgment for the employer, finding the civil claims were barred by the doctrines of res judicata and collateral estoppel, as those claims had been fully litigated before the WCAB. The Court of Appeal affirmed dismissal of the civil case. In both the WCAB and civil proceedings, the plaintiffs sought redress for the same psychiatric injuries caused by the employer’s discriminatory, harassing and retaliatory acts in the workplace.

This case happened to result in a win for the employer, but it could just as easily have resulted in a loss if the WCAB had ruled in favor of the employees. And that is the most important practical lesson for employers, which is the need to carefully monitor parallel workers’ compensation proceedings. Such proceedings are not uncommon, but their defense usually proceeds very differently. In the workers’ compensation realm, the workers’ compensation insurer, not the employer, generally controls the defense of the claim. The matter proceeds under more informal rules of procedure and evidence and is tried to an administrative law judge whose sympathies often lie with the employee.

Consequently, at the outset of any employment litigation, it is critical that an employer determine if there is a pending workers’ compensation proceeding; if so, the employer should carefully monitor that proceeding by proactively engaging with the insurer and its counsel to determine what issues are to be tried and to participate, to the extent possible, in any proceedings on the merits. Otherwise, the employer may find that its fate in the parallel civil proceeding—which carries with it a much greater cost of defense and potential damages—will have been decided by its workers’ compensation insurer and the WCAB.  Similarly, if the WCAB proceeding results in a “win,” the employer should lose no time in filing a motion for summary judgment in the pending civil action in order to take advantage of the victory.

New Mandatory California Training on Gender Identity Harassment

On Oct. 15, 2017, California Gov. Jerry Brown signed Senate Bill 396 into law, expanding the scope of mandatory sexual harassment training employers must provide to their supervisory employees.  Currently, California’s Fair Employment and Housing Act (“FEHA”) requires employers with 50 or more employees to provide at least two hours of prescribed training and education regarding sexual harassment to all supervisory employees within six months of their assumption of a supervisory position, and then once every two years thereafter.  This new law expands the scope of FEHA’s requirements by mandating that the training must also cover harassment based on gender identity, gender expression, and sexual orientation.  Such training must be conducted by individuals with knowledge and expertise in these topics and must include practical examples.

California employers also will be required to post a new poster developed by the Department of Fair Employment and Housing regarding transgender rights in a prominent and accessible location in the workplace.

California Expands Parental Leave Protections

California Gov. Jerry Brown has signed Senate Bill 63 into law, expanding parental leave protections to those individuals who work for employers with at least 20 employees.  Under the new law, which is set to take effect on January 1, 2018, employers with at least 20 employees must allow an employee who has more than 12 months of service with the employer to take up to 12 weeks of parental leave to bond with a new child within one year of the child’s birth, adoption, or foster care placement.  The new law expands the protections afforded under existing law, which had previously applied only to employers with 50 or more employees.

The new law also requires the Department of Fair Employment and Housing to create a parental leave mediation pilot program, which permits an employer to request mediation within 60 days of receipt of a right-to-sue notice and thereby stay any civil action by the employee.  However, an employee may notify the Department in response that he or she has elected not to participate in a mediation and thereby proceed with the civil action.

California Enacts Statewide Law Restricting Inquiries into Applicants’ Salary History

California Governor Jerry Brown has signed into law a statewide salary history inquiry law that will largely restrict employers in the state from seeking and relying upon salary history information from applicants during the hiring process.

The law, which will go into effect on January 1, 2018 and will apply to all private and public sector employers, will prohibit employers from:

  • relying on salary history as a factor in determining whether to offer employment to an applicant or what salary to offer; or
  • seeking, orally or in writing or through an agent, salary history information about an applicant.

The law will also require an employer, upon reasonable request by an applicant, to provide the pay scale for a position.

The law further provides that, if an applicant voluntarily and without prompting discloses salary history information to a prospective employer, that employer may then consider and/or rely on that voluntarily disclosed salary history information in determining the salary for that applicant.  However, the law reiterates that, consistent with the state’s currently existing equal pay law, employers may not rely upon voluntarily disclosed prior salary, by itself, to justify any disparity in compensation.

In passing this law, California joins the ranks of Massachusetts, Oregon and Delaware in enacting statewide salary history inquiry protections (while Illinois vetoed a similar bill in late August).  The new law also comes on the heels of a similar San Francisco ordinance enacted this summer.

Along with San Francisco, New York City and Philadelphia have also passed laws at the local level, while Puerto Rico’s salary history law went into effect in March of this year.

We will continue to report on new developments with regard to this law as they arise.

California Becomes a “Sanctuary State,” Restricts Employer Cooperation With Federal Immigration Authorities

On Thursday, October 5th, California Gov. Jerry Brown signed into law nearly a dozen new immigration-related bills, including AB 450, which prohibits employers from cooperating with federal immigration authorities in the absence of a judicial warrant or court order.  Among other things, the new law:

  • Prohibits employers from voluntarily consenting to an immigration enforcement agent’s entering nonpublic areas of the workplace without a warrant;
  • Prohibits employers from voluntarily consenting to an immigration enforcement agent’s accessing, reviewing or obtaining employment records without a subpoena or court order;
  • Prohibits employers from reverifying the employment eligibility of a current employee at a time or in a manner not required by federal law; and
  • Requires employers to provide notice to current employees of an inspection of I-9 forms and other employment records by an immigration agency within 72 hours of receiving the federal notice of inspection.

Penalties for failure to comply with the new law range from $2,000 to $10,000 per violation.

Gov. Brown signed the controversial new laws over objections from the United States Immigration and Customs Enforcement and the California State Sheriffs’ Association, among other groups.