2023 Labor Law Update

There are several new employment laws for 2023 that affect California employers. We’ve compiled the highlights for this post but also are including below the link to our 2023 Labor Law Update webinar and the slides for your review.

Minimum Wage Increase

The California state minimum wage is increasing to $15.50 hr for all businesses in CA other than those under a county or city regulation that is higher.

• 25 employees or less was $14.00, increasing to $15.50
• 26 employees or more, was $15.00, increasing to $15.50

The counties and cities that have a higher minimum wage already have not released additional info but we will keep an eye out.

Pay Equity and Pay Scales

SB 1162 allows for more pay transparency, which makes pay scale information available to job applicants and employees.

• Employers of all sizes must, upon request, provide a pay range to an employee for the position the employee is working
• Employers with 15 or more employees must include the pay range information for a position in any job posting.
• Employers of all sizes will need to keep records of job title and wage rate history for each employee throughout their employment and for three years after termination.

Some thoughts on this:

• Anticipate that employees will start asking about their own pay ranges and will likely see any job ads you place.
• If they make less than the posted pay scale, you may face scrutiny.
• Be sure to analyze current positions and create a reasonable pay scale that takes all things into consideration.
• Consider, if the ranges you post in ads are too wide, it may appear you're trying to game the system. This may foment distrust and could potentially lead to candidates or employees reporting you.

Leaves of Absence

AB 1041 expands who an employee can take leave to care for under both the CFRA) and PSL.

• Employees can take CFRA leave or paid sick leave to care for a “designated person"
• “Designated person” means any individual related by blood or whose association with the employee is the equivalent of a family relationship.
• An employer may limit an employee to one designated person per 12-month period for family care and medical leave.

Bereavement

AB 1949 makes bereavement leave a protected leave of absence.

 The law applies to all private employers with five or more employees and all public employers

• Employees may take up to five days of bereavement leave upon the death of a family member. Employers may require documentation.
• Family member includes a spouse, child, parent, sibling, grandparent, grandchild, domestic partner or parent-in-law
• Bereavement leave may be unpaid, but employees can use their existing available leave (e.g., vacation, PTO, sick leave, etc.).

Workplace Safety

SB 1044 relates to the employer’s ability to take adverse action against employees in “emergency conditions”

• Prohibits an employer, in the event of an “emergency condition”, from taking or threatening adverse action against the employee for refusing to report to or leaving a workplace because the employee has a reasonable belief that the workplace is unsafe.
• The new law also prohibits an employer from preventing any employee from accessing their mobile device or other communications device to get emergency assistance, assess the safety of the situation or communicate with someone to verify their safety.

COVID 19

AB 2693 made several changes to the state’s COVID-19 notice requirements.

• Employers may now satisfy the COVID notice requirements by prominently displaying a notice in the workplace of the potential exposure.
• AB 2693 also removes the requirement that employers report cases to their local health departments.
• COVID-19 notice requirements were set to expire on January 1, 2023, but AB 2693 extended the notice requirements to January 1, 2024.

Fast Food Workers

AB 257 will create the Fast Food Council within the Department of Industrial Relations.

• Council is composed of 10 unelected members chosen by the Governor, the Assembly and the Senate Rules Committee.
• The Council will work to establish minimum wages, working hours and other working conditions for fast food restaurants.
• No word on when their recommendations will be effective.
• “Fast food chain” means a set of restaurants consisting of 100 or more establishments nationally that share a common brand.

Timeclock Rounding

Not a Bill but recently adjudicated in the California Supreme Court.

• The “Camp vs Home Depot case” doesn’t end rounding but makes it questionable for the future.
• Modern technology makes the use of rounding unnecessary due to the accurate nature of timeclock records.
• Two employees involved, one was over paid and the other, “Camp” was underpaid. Case is still pending, however…
• It is advised to discontinue current rounding practices and/or consult a labor attorney before resumption of any rounding practices.

Discrimination – (2024)

Two new laws will expand the scope of California’s Fair Employment and Housing Act (FEHA). These laws are not effective until 2024.

• AB 2188 adds cannabis protection to the state’s discrimination law.
• Employers may not discriminate against an employee or job applicant based on their use of cannabis off the job and away from the workplace
• Employers may still conduct preemployment drug testing but it cannot screen for non-psychoactive cannabis metabolites (CBD).
• SB 523, amends the FEHA to make it unlawful to discriminate against an employee or job applicant based on their “reproductive health decision-making.” Likely referring to abortion and invitro fertilization.

Health Insurance Rebates

As part of ACA, health insurers are required to return unused health premium above 20% - first year of returns.

• If you receive a Medical Loss Ration (MLR) rebate, it must be distributed to the employees who paid for insurance during that associated year.
• May be paid cash (taxable or pretax) or provided as a discount to current premiums.
• Should be paid out in the same ration the employees paid for their insurance. Does not need to be paid to employees 100% paid for

DFEH is Now Civil Rights Division

The Department of Fair Employment and Housing (DFEH) is now the California Civil Department (CRD).

The Civil Rights Department is the state agency charged with enforcing California’s civil rights laws. The mission of the CRD is to protect the people of California from unlawful discrimination in employment, housing, businesses, and state-funded programs, and from bias-motivated violence and human trafficking.

Conclusion

2023 should be an interesting year. With a looming economic downturn, small business owners will need to invest more in their workforce and work hard at retaining key employees and being able to attract new employees. Larger businesses have already begun to prepare, have you?

Contact the HR pros at Infinium for any guidance on employee management, HR automation or labor law compliance issues you may be facing.