New California Employment Laws for 2018

By: Bhakti Shivarekar

Governor Brown has signed into law the following employment-related Bills that will impact California employers starting January 1, 2018. The objective of this alert is to share some significant labor laws that take effect on January 1, 2018, along with tips as to how employers can ensure compliance with the laws.

1. Salary History:

Employers are banned from seeking an applicant’s past salary information. This new law also requires employers to provide the position’s pay scale to applicants upon reasonable request. All employers, public and private, are prohibited from relying on “salary history Information” as a factor in determining whether to offer employment and what salary to offer to an applicant. Also, an employer cannot, orally or in writing, personally or through an agent (such as a manager or even a third party), seek salary history information about an applicant. Salary history information includes information about compensation and benefits.

How can employers comply with this law:

1. Revise job applications and notices to remove questions that could seek salary history information.
2. Revise applicable hiring policies and procedures and interview/screening guidelines to ensure compliance with the new law.
3. Training all personnel involved at any stage of the hiring process to ensure they understand the restrictions and obligations imposed by the new law.
4. Employers in San Francisco should also take note that a similar city ordinance takes effect in July 2018.

2. Ban the Box law

The new California Ban-the-Box law amends the Fair Employment and Housing Act (“FEHA”) to make it an unlawful employment practice for employers with five or more employees to:

• include on any application for employment any question that seeks the disclosure of an applicant’s conviction history;

• inquire into or consider an applicant’s conviction history before the applicant receives a conditional offer of employment; and

• consider, distribute, or disseminate information related to arrests that did not result in convictions, diversion program participation, and/or convictions that were sealed, dismissed, expunged or eradicated.

Following are the exceptions to this law:

• positions for which government agencies are required by law to check conviction history;
• positions with criminal justice agencies;
• farm labor contractors; and positions for which the employer is required by federal, state or local law to check criminal history or to restrict employment based on criminal history.

The law provides that covered employers may only consider an applicant’s conviction history after the applicant has received a conditional offer of employment. If an employer intends to deny hire solely or in part because of conviction history, the employer must conduct an individualized assessment to determine whether that history has a direct and adverse relationship with the specific duties of the job. Moreover, when making that assessment the employer must consider the nature and gravity of the offense and conduct, the passage of time since the date of the offense/conduct and completion of any sentence, and the nature of the position held or sought. Employers may, but are not required to, record the results of their individualized assessments in writing.

If the individualized assessment leads to a preliminary decision that the conviction history is disqualifying, the employer must then follow a specific procedure, sometimes referred to as a “fair chance” process, as follows:

• First, the employer must provide written notice to the applicant. The written notice must identify the conviction on which the preliminary decision is based, include a copy of the conviction history report, if any, and explain the applicant’s right to respond to the notice within at least five business days.
• Second, if the applicant timely notifies the employer in writing that the applicant is disputing the conviction history and is taking steps to obtain evidence to do so, the employer must provide the applicant an additional five business days to respond.
• Finally, if after receiving the response from the applicant the employer makes a final decision to deny employment based on conviction history, the employer must again notify the applicant in writing. This final notification must include: the final denial; information relating to any existing procedure to challenge the decision or request reconsideration; and the right to file a complaint with the Department of Fair Employment and Housing. The employer has the option to include an explanation for making the final denial.

How can employers comply with this law:

• Revise their paper and online employment applications to remove “boxes” or questions which seek criminal conviction information from applicants.
• Review interview guidelines and hiring processes to ensure compliance with the law, and train managers, hiring, and recruiting personnel that they may not seek or rely on conviction history before a conditional offer of employment is made.
• Adopt procedures to comply with the individualized assessment and “fair chance” process requirements.

3. New Parental Leave Act

Small businesses must provide parental leave. The New Parent Leave Act amends the California Family Rights Act (“CFRA”) to allow employees who work for an employer with at least 20 employees to take 12 weeks of unpaid leave for new child bonding purposes so long as the employee works at a worksite that employs at least 20 employees within a 75-mile radius. The new law is a significant expansion of the CFRA. The current CFRA only applies to employers with 50 or more employees.

To whom does this law apply?

The law applies to private and public employers who have at least 20 employees within a 75-mile radius.

Like CFRA’s current requirements, it will be unlawful for a covered employer to refuse to allow an eligible employee to take up to 12 weeks of job-protected parental leave to bond with a new child within one year of the child’s birth, adoption or foster care placement.

Which employees are eligible?

Eligible employees must have 12 months of service plus at least 1,250 hours of service with the employer during the 12-month period preceding the leave.

How does the law work?

Before the start of a parental leave, the employer must provide the employee with a guarantee of reinstatement to the same or comparable position following the leave; Failure to provide this guarantee will violate the law.

If both parents work for the same employer and are otherwise eligible for leave, the employer can require them to share the 12-week allotment between them.

Leave is unpaid, although employees may use accrued vacation, paid sick time, other accrued paid time off, or other paid or unpaid time off negotiated with the employer, and can apply for California Paid Family Leave benefits. Employers must maintain and pay for group health coverage during a parental leave at the level and under the conditions that coverage would have been provided had the employee continued working. The employer can recover coverage costs if the employee fails to return from leave after the leave entitlement period has expired and the failure to return is for a reason other than the continuation, recurrence, or onset of a serious health condition or other circumstances beyond the employee’s control.

The new law does not affect an employee’s right under California law to take up to four months of leave for pregnancy-related disability, in addition to the 12 weeks of parental leave. Also, the new law does not apply to employees who are already subject to the FMLA and CFRA.

How can employers comply with this law:

• promptly update employee handbooks and personnel policies,
• create/update leave request forms and notices with respect to the new leave rights, reinstatement guarantee, and other requirements.
• Provide training to human resource employees and managers about the new leave rights and obligations.

4. Anti-Harassment Training

California Fair Employment and Housing Act (FEHA) requires employers with 50 or more employees to provide two hours of sexual harassment education and training to supervisory and managerial employees, every two years.

What’s new under the new law:

Anti-harassment training must include a component on harassment based on gender identity, gender expression, and sexual orientation.  This training must include “practical examples inclusive of harassment based on gender identity, gender expression, and sexual orientation,” and must be “presented by trainers or educators with knowledge and expertise” in these areas.

Employers with five or more employees to post a new workplace notice, to be developed by the Department of Fair Employment and Housing, regarding transgender rights.

How can employers comply with this law:

• Employers should be certain to update their sexual harassment training to include information regarding gender identity, gender expression, and sexual orientation.
• Also, keep an eye on the new poster and ensure it’s up in your workplace by January 1, 2018.

5. Increases in Minimum Wage:

Effective January 1, 2018, the California minimum wage is increasing. For employers with 25 employees or less, the minimum wage will increase to $10.50 per hour. For employers with 26 or more employees, the minimum wage will increase to $11.00 per hour.

 Please feel free to call us if you have any questions regarding the new laws.