San Jose is the third northern California city to enact a scheduling ordinance that further regulates employers’ scheduling and hiring practices.  Following on San Francisco and Emeryville’s lead, San Jose recently passed “The Opportunity to Work Ordinance” (Ordinance No. 2016.1, codified at Chapter 4.101 of the San Jose Municipal Code), which went into effect on February 6, 2017.

The primary aim of the Ordinance is to create more full-time jobs in place of multiple part-time jobs for affected employees by requiring employers to first offer additional hours to existing, part-time employees who, in the employer’s good faith and reasonable judgment, have the relevant skills and experience.  Such hours should be distributed by way of “a transparent and nondiscriminatory process.”  It is only after the employer cannot distribute more hours to qualified and willing part-time employees that it may resort to hiring additional employees or subcontractors, including those hired through staffing or temporary agencies.  However, employers are not required to abide by these procedures if the hours in question would have to be paid at a premium rate (i.e., overtime for more than 8 hours in a day/40 in a week).

San Jose employers also must post a notice informing employees of their rights under the Ordinance and retain various records. Retaliation against employees exercising their rights under the Ordinance is strictly prohibited.

The Ordinance applies to all employers who employ more than 35 employees and who are subject to San Jose’s business tax.  When counting the number of employees, employees should include all persons, including corporate officers and executives, who are directly or indirectly employed, or over whom the employer exercises controls (e.g., with regard to wages, hours, or working conditions).  The employee count also includes all of the business’s employees—even if they are not employed in San Jose—thus subjecting franchises and chain retail stores and restaurants to the new rules.

There are two exceptions in the Ordinance’s application:

  1. Employers that can demonstrate hardship (i.e., that they have, in good faith, taken all reasonable steps to comply but find that complete and immediate compliance is impracticable, impossible, or futile) may be exempt.
  2. Unionized employees may waive the Ordinance provisions and entitlements through collective bargaining.

Employers in San Jose should take immediate attention.  Although fines, fees, and civil penalties (of $50 per employee for each day of violation) will not be assessed for an employer’s first violation, there is no such “first-pass” for the Ordinance’s provision of attorneys’ fees and costs to prevailing aggrieved parties.

This trend regarding local regulation of part-time employee hours is certainly not unique to California, as Seattle passed its own version of a “secure scheduling” ordinance last year and numerous other cities—including Washington D.C., New York, Minneapolis, and Albuquerque—have considered doing the same.