Monthly Archives: January 2017

2017 New Laws


Choice of Law and Venue in Employment Contracts.  California employers cannot require employees who primarily live and work in California to agree to litigate or arbitrate claims against the employer somewhere other than California and agree to apply law other than California law to resolve employment disputes.  Labor Code § 925.

Applicants for Employment.  Existing law prohibits an employer from asking an applicant for employment to disclose information concerning an arrest or detention that did not result in a conviction, or information concerning a referral or participation in, any pretrial or post-trial diversion programs, with limited exceptions.  Effective January 1, 2017, the same prohibitions exist while the person was subject to the process and jurisdiction of juvenile court.  Labor Code §432.7.

Posters – new CA minimum wage poster is required.

Wage Inequality Claims: The California Fair Pay Act now goes beyond gender wage inequality to address racial/ethnic wage disparity.  Employers are prohibited from paying any of its employees wage rates that are less than the rates paid to employees of another race or ethnicity for substantially similar work.  Prior salary cannot, by itself, justify a disparity in compensation.  Employers are prohibited from paying any of their employees less than employees of the opposite sex or of another race or ethnicity for “substantially similar work.” The burden is on employers to justify pay differentials from an acceptable list of factors that must be applied reasonably. The relied upon factors must account for the entire wage differential. The California Fair Pay Act does not require an employee to show any discriminatory intent. Labor Code § 1197.5

California’s minimum wage is $10.50 per hour for employers with 26 or more employees and $10 per hour for employers that employ 25 or fewer people.​

Minimum Salary Requirements for Exempt Employees.  Properly classified exempt employees generally must meet a specific minimum salary test. Under California law, the most common exemptions require employees to earn a minimum monthly salary of no less than two times the state minimum wage for full-time employment, and the salary must be a pre-determined sum. There are different rules for some employees, such as hourly physicians, computer professionals and outside salespersons. However, placing an employee on a salary does not exempt that employee from wage and hour laws. A nonexempt employee placed on a “salary” earns overtime just as hourly wage earners do.

The minimum monthly salary requirement for exempt executive, administrative and professional employees is no less than two times the state minimum wage for full-time employment. It is based on the current state minimum wage, not any applicable local minimum wage. Accordingly, the 2017 minimum salary threshold for these exemptions is as follows:

For employers with 26 or more employees, the state minimum wage is $10.50 per hour.  The minimum monthly salary test for these exemptions is $3,640 per month ($43,680 per year) for 2017.

For employers with 25 or fewer employees, the state minimum wage does not increase. It remains at $10 per hour in 2017. Accordingly, the minimum monthly salary test remains at $3,466.67 per month ($41,600 per year) for 2017.

Verifying Hiring Documents.  Employers may not request more or different documents than required under federal law to verify employment eligibility.  Employers cannot refuse to honor documents that on their face reasonably appear to be genuine or reinvestigate or re-verify an incumbent authorization to work using an unfair immigration-related practice. The financial penalty for violating these provisions is up to $10,000. Labor Code §1019.1.

Marijuana in the Workplace.  Proposition 64 (effective 11/8/16) states that it is intended to “allow public and private employers to enact and enforce workplace policies pertaining to marijuana.” The initiative also provides that it will not be construed or interpreted to amend, repeal, affect, restrict or pre-empt:

“The rights and obligations of public and private employers to maintain a drug and alcohol free workplace or require an employer to permit or accommodate the use, consumption, possession, transfer, display, transportation, sale or growth of marijuana in the workplace, or affect the ability of employers to have policies prohibiting the use of marijuana by employees and prospective employees, or prevent employers from complying with state or federal law.”

Marijuana remai​ns an illegal Schedule I substance under federal law.  Employers with drug- and alcohol-free workplace policies may continue to maintain and enforce them in California.

Rest Breaks.  ​​​​Employers must authorize and permit paid rest periods for all nonexempt employees whose total daily work time is at least 3.5 hours. These mandatory rest breaks must be offered at the rate of 10 “net” minutes for every four hours worked, or “major fraction thereof.”  The rest period begins when the employee reaches an area away from the workstation that is appropriate for rest.  Rest periods as paid as hours worked. Employers may not require employees to remain “on call” during rest periods.  Augustus v. ABM Security Systems, Inc., No. S224853 (December 22, 2016).Content 1

Victims of domestic violence, sexual assault and stalking (applicable to employers of 25 or more employees) may take protected time off for medical treatment or legal proceedings, have rights to accommodation, and protections against discrimination.  Effective July 1, 2017, a required form must be given to all new employees when hired and to current employees upon request, which will be developed by the Labor Commissioner. Employers are not required to comply with this notice requirement until the Labor Commissioner posts the new form on its website. Labor Code § 230.1(h).

Licensure Requirements for Hair Salons/Nail Salons

Effective July 1, 2017, any establishment that is licensed by the Board of Barbering and Cosmetology (BBC) (e.g., hair salons, nail salons, estheticians, etc.) must post a notice regarding workplace rights and wage-and-hour laws. The Labor Commissioner must create the model notice by June 1, 2017. The BBC is required to inspect for compliance with the posting requirement; failure to post the notice will result in a fine.

The model notice shall include information, including, but not limited to, all of the following:

(1) Misclassification of an employee as an independent contractor.

(2) Wage and hour laws, including, but not limited to, minimum wage, overtime compensation, meal periods, and rest periods.

(3) Tip or gratuity distribution.

(4) How to report violations of the law.

(5) Business expense reimbursement.

(6) Protection from retaliation.

(c) The model notice shall include full text translations in Spanish, Vietnamese, and Korean.

Labor Code § 98.10

Appeal of Labor Commissioner ruling on minimum wages must post bond to cover amount owed which must be paid within 10 days of conclusion of the proceedings.  Labor Code § 1197.1.

Smoking in the Workplace.  The smoking ban extends to covered parking lots, lobbies, lounges, waiting areas, elevators, stairwells and restrooms for owner-operated businesses.  In addition, former exemptions are now eliminated for hotel lobbies, bars and taverns, banquet rooms, warehouse facilities and employee breakrooms. Labor Code §6404.5.


Consumer Review Fairness Act of 2016: prohibits restriction on online posts.  Under the federal law, terms that disparage, restrict, or penalize poor customer reviews will be void. Any company that attempts to restrict customers or punish them for reviews will be subject to Federal Trade Commission enforcement of the law, with potential penalties. Enforcement authority is provided to the Federal Trade Commission (FTC) and states. The FTC must provide businesses with nonbinding best practices for compliance. Public Law No: 114-258

New IRS mileage reimbursement rate: $ 53.5/mile

Limited liability company dissolution: now requires 50% or more of the voting interests of the LLC members rather than a majority of the LLC members.  Corporation Code §§ 17707.01 and 17707.02.

Single-user restrooms are open to all genders, effective 3/1/17.  Health & Safety Code § 118600.

Real Estate

Land suitable for residential development” includes airspace above sites owned or leased by cities and counties.  Government Code § 65583.2.

Disclosure of death on residential property.  There is no affirmative duty for seller’s to disclose to prospective buyer/tenant of residential property that someone died on the property.  But if a prospective buyer or tenant asks about deaths on the property, the seller/landlord/agent must answer truthfully.  Civil Code §1710.2.

Accessibility Standards.  Commercial landlords must give prospective tenants a copy of any Certified Access Specialist (CASp) report at least 48 hours before a lease is signed or the tenant can rescind the lease within 72 hours after signing the lease.  If the property has not had a CASp inspection, the tenant may request one and the parties would then have to agree on arrangements for the inspection and how to pay for any needed repairs.  Civil Code § 1938.


Court reporters OK in arbitration proceedings, paid by requesting party.  Code of Civil Procedure §1282.5

Businesses that are proactively trying to comply with ADA will have a chance to fix any violations prior to commencement of litigation.  Civil Code §§ 53.53, 55.56.

Sex offense perpetrators cannot require confidentiality provisions in settlement agreements relating to facts underlying a civil claim for a felony sex offense, an act of childhood sexual abuse, sexual exploitation of a minor, or an act of sexual assault against an elder or dependent adult.  Code of Civil Procedure § 1002.

Unless landlord prevails within 60 days after filing an eviction suit against a tenant, the case record will remain sealed and not accessible to unlawful detainer registries.  Code of Civil Procedure § 1161.2.

Family Law

“Separation” does not require living separately.  The date of separation is the date that a “complete and final break in the marital relationship has occurred,” as evidenced by the spouse (1) expressing to the other spouse his or her intent to end the marriage, and (2) acting consistently with his or her intent to end the marriage.  Family Code §§ 70 and 771.

“Registered domestic partner” is the same as “spouse.”  Family Code §143.

Reminder of 2016 Employment Law

Harassment and Discrimination Prevention and Correction.

(a) Employers have an affirmative duty to take reasonable steps to prevent and promptly correct discriminatory and harassing conduct. (Gov. Code, § 12940(k).)

(1) A determination as to whether an employer has complied with Government Code section 12940(k) includes an individualized assessment, depending upon numerous factors sometimes unique to the particular employer including, but not limited to, its workforce size, budget, and nature of its business, as well as upon the facts of a particular case.

(2) There is no stand-alone, private cause of action under Government Code section 12940(k). In order for a private claimant to establish an actionable claim under Government Code section 12940(k), the private claimant must also plead and prevail on the underlying claim of discrimination, harassment, or retaliation.

(3) However, in an exercise of its police powers, the Department may independently seek non-monetary preventative remedies for a violation of Government Code section 12940(k) whether or not the Department prevails on an underlying claim of discrimination, harassment, or retaliation.

(b) Employers have an affirmative duty to create a workplace environment that is free from employment practices prohibited by the Act. In addition to distributing the Department’s DFEH-185 brochure on sexual harassment, or an alternative writing that complies with Government Code section 12950, an employer shall develop a harassment, discrimination, and retaliation prevention policy that:

(1) Is in writing;

(2) Lists all current protected categories covered under the Act;

(3) Indicates that the law prohibits coworkers and third parties, as well as supervisors and managers, with whom the employee comes into contact from engaging in conduct prohibited by the Act;

(4) Creates a complaint process to ensure that complaints receive:

(A) An employer’s designation of confidentiality, to the extent possible;

(B) A timely response;

(C) Impartial and timely investigations by qualified personnel;

(D) Documentation and tracking for reasonable progress;

(E) Appropriate options for remedial actions and resolutions; and

(F) Timely closures.

(5) Provides a complaint mechanism that does not require an employee to complain directly to his or her immediate supervisor, including, but not limited to, the following:

(A) Direct communication, either orally or in writing, with a designated company representative, such as a human resources manager, EEO officer, or other supervisor; and/or

(B) A complaint hotline; and/or

(C) Access to an ombudsperson; and/or

(D) Identification of the Department and the U.S. Equal Employment Opportunity Commission (EEOC) as additional avenues for employees to lodge complaints.

(6) Instructs supervisors to report any complaints of misconduct to a designated company representative, such as a human resources manager, so the company can try to resolve the claim internally. Employers with 50 or more employees are required to include this as a topic in mandated sexual harassment prevention training, pursuant to section 11024 of these regulations.

(7) Indicates that when an employer receives allegations of misconduct, it will conduct a fair, timely, and thorough investigation that provides all parties appropriate due process and reaches reasonable conclusions based on the evidence collected.

(8) States that confidentiality will be kept by the employer to the extent possible, but not indicate that the investigation will be completely confidential.

(9) Indicates that if at the end of the investigation misconduct is found, appropriate remedial measures shall be taken.

(10) Makes clear that employees shall not be exposed to retaliation as a result of lodging a complaint or participating in any workplace investigation.

(c) Dissemination of the policy shall include one or more of the following methods:

(1) Printing and providing a copy to all employees with an acknowledgment form for the employee to sign and return;

(2) Sending the policy via e-mail with an acknowledgment return form;

(3) Posting current versions of the policies on a company intranet with a tracking system ensuring all employees have read and acknowledged receipt of the policies;

(4) Discussing policies upon hire and/or during a new hire orientation session; and/or

(5) Any other way that ensures employees receive and understand the policies.

(d) Any employer whose workforce at any facility or establishment contains 10 percent or more of persons who speak a language other than English as their spoken language shall translate the policy into every language that is spoken by at least 10 percent of the workforce.

  • CCR § 11023

Rest Periods: Employees Must Be Relieved Of All Duties

On December 22, 2016, the California Supreme Court decided a landmark case regarding rest periods that is applicable to California employers.  The issue relates to California’s rest period obligations, holding that employers must “relieve employees of all duties” and “relinquish all control over employees” during rest periods.

“California law requires employers to relieve their employees of all work-related duties and employer control during 10-minute rest period.”

Security guards employed by ABM Security Services were required to keep their pagers and radio phones on, remain vigilant, and respond when needs arose when on their rest breaks.  The security guards sued ABM for failing to consistently provide uninterrupted rest periods.  The Supreme Court affirmed a trial court judgment against ABM for $90 million.

The California Supreme Court held that Labor Code Section 226.7(a) prohibits an employer from requiring “any employee to work during any meal or rest period mandated by an applicable order of the Industrial Welfare Commission (“IWC”).”  IWC Wage Order 4, 12(a) provides that “[e]very employer shall authorize and permit all employees to take rest periods…”

Employers that require employees to remain “on-call” during their rest periods violate wage order requirements that a rest period means “uninterrupted.”

Employers unable to comply with providing employees an uninterrupted rest period have other options, including rescheduling rest periods, providing new rest periods when interruptions occur and paying the premium pay remedy for missed rest periods.  The retroactive applicability of the decision is unclear.


Augustus v. ABM Security Services, Inc. (12/22/16), 2016 DJDAR 12608).