California Employment Law Update Fall 2020

Governor Gavin Newsom signed a slate of pro-employee legislation into law in the past month, including critical freelancer/independent contractor and family leave laws. In addition, businesses with more than 100 employees are now required to report data on salary by gender and race to the California Department of Fair Employment and Housing, providing more transparency into the wage gap.

In this post, we will review three of these new laws and preview what it all means to California workers going forward. The new employment laws are:

  • B. 1383, California’s new family-leave law guaranteeing most workers 12 weeks of sick leave to care for a new baby, a sick relative or themselves
  • B. 2257, making it easier for businesses to classify gig workers as independent contractors
  • B. 973, requiring businesses with more than 100 employees to submit employee wages by race and gender to the California DFEH

S.B. 1383 Strengthens California Family Medical Leave Act

This law seeks to address loopholes in the state and local patchwork of medical leave statutes that have proliferated over the past decade by guaranteeing workers up to 12 weeks off for maternity or paternity leave, convalescent leave or to care for an ailing family member.

Perhaps the largest impact will be felt in the expanded definitions of “family member.” Previously, only a spouse, child, or parent with a serious health condition qualified. Under the new law, domestic partners, children of domestic partners, grandparents, grandchildren, siblings, or parents-in-law all qualify.

A.B. 2257 An Aftershock In The Seismic Shift Brought About By A.B. 5

It’s hard to believe that A.B. 5, the landmark law that codified the “ABC” test, came into effect just ten months ago. The “ABC” test, first established in the California Supreme Court’s ruling in Dynamex Operations West, Inc. v. Superior Court, requires companies to prove that a contractor is:

  1. Free from control and direction by the hiring entity both under the contract and in the performance of the work;
  2. The work being performed is outside of the usual course of the hiring entity’s business; and
  3. The person is customarily engaged in performing work of the same nature as an independently established trade, occupation or business.

While the aim of A.B. 2257 is to smooth the rough edges of A.B. 5, it is a tall task for many attorneys, let alone employers and employees, to make sense of the law. What is clear is that it is now easier for some 40 different classes of workers to classify as independent contractors versus full time employees. That is because the law will apply a more relaxed test when determining contractor status, at least to most artistic professions.

S.B. 973 Shines A Light Into The Wage Gap

California businesses with 100 or more employees must now provide the California Department of Fair Employment and Housing with reporting on employee wages by race and gender. The required “pay data report” is a replacement for a rescinded federal reporting requirement and will hopefully provide transparency into wage structures at medium to large businesses here in California.

Questions About California’s New Employment Laws?

The complexity of today’s employment laws cannot be overstated. If you are a worker with questions about how these new laws will impact your workplace in 2020 and beyond, contact us online to discuss your issue.