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Paul Zimmerman

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Employer Alert: Key 2017 California Employment Law Updates

Recent federal, state, and municipal employment law developments will have a significant impact on employers in 2017. Employers must update their employee handbooks, employment agreements, arbitration agreements, confidentiality agreements, and related policies and procedures to ensure that they are compliant with these developments. This is Part II of a four part series exploring key employment law updates for 2017. Part I reviewed important changes to United States federal law.

We now address significant updates to California state law:

Employment Contracts: Choice of Law and Forum. Employers may no longer require employees who reside and work in California, as a condition of employment, to litigate or arbitrate employment disputes (1) outside of California or (2) under the laws of another state. An exception exists if the employee was individually represented by a lawyer in negotiating an employment contract.

State-Run Retirement Savings Plan. Nearly seven million workers for California employers will be automatically enrolled in a new state-run retirement program. The law requires all California companies with at least five employees to enroll their workers in the new California Secure Choice Retirement Savings Program if they do not offer their own retirement savings plan.

Fair Pay. The California Fair Pay Act has been amended to prohibit employers from (1) considering prior salary as the sole justification for any disparity in compensation and (2) paying differently for substantially similar work  based on race and ethnicity (prior to this amendment, the law addressed only gender).

Juvenile Criminal Records. Subject to a limited healthcare industry exception, California employers are now prohibited from asking applicants to disclose juvenile convictions. They are also barred from using information related to juvenile arrests, detentions, or court dispositions.

Immigration Status. Employers may not request more or different documents than required under federal law to verify work status, refuse to honor documents that reasonably appear to be genuine, or improperly attempt to reinvestigate or reverify a work authorization.

Employment Protections. Employers must inform each new employee in writing, and must inform current employees upon request, of the rights of employees affected by domestic violence.

Municipal Paid Sick Leave and Minimum Wage Laws. Los Angeles employers must either provide 48 hours of paid sick leave to an employee yearly, or provide one hour of paid sick leave per every 30 hours worked, with a 48 hour accrual limit and a cap of no less than 72 total hours. This is a significant expansion of current paid sick leave rights, as it effectively doubles the amount of paid sick leave hours required by California law. San Francisco, Oakland, Emeryville,  San Diego, Pasadena and Santa Monica have also passed detailed paid sick leave laws. In addition, Los Angeles has enacted a series of increases in the minimum wage.

Paid Family Leave. The amount of benefits paid to employees on paid family leave and state disability leave has been increased from 55 percent to either 60 or 70 percent, depending on the employee’s income.

Stay tuned for Parts III – IV of this series exploring new employment laws in New York and Illinois.

This blog post is not offered as, and should not be relied on as, legal advice. You should consult an attorney for advice in specific situations.