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Five New California Laws Employers Need to Know

November 21, 2023 Articles
Law360

California has become a trendsetter when it comes to implementing new laws. The state is often at the forefront of key issues and paves the way for other states to follow in its footsteps.

This is especially true for employment law; the Golden State is constantly evolving and implementing new laws that change the practice of business and the culture of the workplace.

This year, the California Legislature passed, and Gov. Gavin Newsom signed, several new or amended employment laws, including laws regarding reproductive loss leave, cannabis use, workplace violence prevention and noncompete agreements.

These measures either introduce new employee protections or codify existing practices into state law, and with these changes, employers are sure to feel the impact. Unless otherwise noted, these laws take effect Jan. 1, 2024, so now is a good time for employers to evaluate their personnel rules and practices to ensure they keep pace with these changes.

SB 848: Reproductive Loss Leave

Last year, the California Legislature passed AB 1949, which required California employers with five or more employees to offer five days of unpaid bereavement leave to employees upon the death of a qualifying family member.

This year, California enacted SB 848 on Oct. 10, which requires California employers with five or more employees to offer up to five days unpaid leave when an employee suffers a reproductive loss event, i.e., a miscarriage, stillbirth, failed adoption, failed surrogacy or unsuccessful assisted reproduction.

Employers are only mandated to provide reproductive loss leave to employees who have been employed by the employer for at least 30 days.

Employees must take such leave within three months of the reproductive loss event and, if an employee suffers multiple reproductive loss events, they are limited to 20 days of leave in a 12-month period.

Though the leave is unpaid, employees must be allowed to use any accrued paid leave, including paid sick leave.

SB 848 mandates employers maintain the confidentiality of any employee requesting reproductive loss leave and is silent as to whether employers are allowed to request documentation supporting such leave.

As with other Fair Employment and Housing Act-protected leave, employers are prohibited from retaliating against employees for requesting a reproductive loss.

Tips and Takeaways

It's key for employers to not act impulsively regarding employee requests for time off, especially in situations that might involve a tragedy in an employee's personal life.

Before denying a request for leave, employers should ensure employees are aware of their rights to request protected leave and that such information is included in an employee handbook.

In addition to keeping employees informed of their rights to protected leave, employers should ensure that human resources managers and professionals are adequately trained to respond to and address requests for time off.

While additional training might appear burdensome on the surface, the risk of potential liability would be much greater — and there is never anything wrong with supporting employees and fostering a workplace built on trust, all of which would be reinforced with additional and targeted training.

Finally, employers should exercise caution in taking adverse actions against employees who request reproductive loss leave.

SB 700: Expanded Protections for Off-Duty Cannabis Use

For the second consecutive year, California has enacted a law providing more protection for off-work cannabis use.

Last year, California enacted AB 2188, which will prohibit employers from taking action against employees for off-duty cannabis use when it goes into effect Jan. 1, 2024. 

This year, California has expanded that protection by prohibiting employers from requesting information from applicants about prior cannabis use.

Like AB 2188, SB 700 exempts employers in the building and construction trade and explicitly does not preempt state or federal laws allowing for drug testing.

Employers are still allowed to inquire about an applicant's criminal history if otherwise permitted by law.

Tips and Takeaways

Employers should review their drug and alcohol policies for compliance with both of these new laws and train all personnel who interview candidates.

Employers that drug test applicants as part of their onboarding process should work with their vendors to ensure they do not receive any information regarding an applicant's cannabis use.

It is imperative that those conducting interviews know what is and what isn't allowed.

Additionally, employee handbooks are a critical tool in providing structure for employees and protection for businesses.

An employee handbook is only useful to the extent it reflects existing, lawful policies, and employers should remember to update it regularly.

They also serve as an ongoing resource for any related questions that may arise in the future.

SB 553: Workplace Violence Prevention

Effective July 1, 2024, California employers must update their existing injury and illness prevention programs to include workplace violence prevention plans, or WVPPs, that comply with new Labor Code, Section 6401.9.

The WVPP must be in writing and be easily accessible to employees, and it must comply with the state's injury and illness prevention program. SB 553 was signed into law Sept. 30.

The plan must offer a reporting channel for incidents and threats of violence and establish logs where threats and acts of violence are centrally tracked.

Employers are required to train employees in workplace violence prevention once per year.

Employer locations with no public access and with fewer than 10 employees at a time are exempted, along with health care facilities, facilities operated by the California Department of Corrections and Rehabilitation, certain law enforcement agencies, and teleworkers.

Employers will be required to maintain the following records for five years: (1) records of workplace violence hazard identification, evaluation and correction; (2) workplace violence incident investigations; and (3) violent incident logs.

All WVPP records required under the statute must be made available to the Division of Occupational Safety and Health, or Cal/OSHA, upon request.

Employees and their representatives are entitled to records reflecting hazard identification, evaluation and correction, as well as violent incident logs, within 15 days of request.

Cal/OSHA will enforce the new law through its standard inspection, citation and penalty framework.

Depending on the nature of an alleged violation, potential penalties may climb as high as $25,000, for violations classified as serious, or $153,744 for violations classified as willful.

Tips and Takeaways

Post-pandemic, workplace safety has taken on new importance given the increased frequency of mass shootings, many of which often take place at workplaces.

This bill has a substantial training element to it. Employers are required to provide training when the plan is initially implemented and then annually thereafter.

This bill takes effect next summer, so it's imperative that employers begin crafting their initial training session to review their WVPP with their employees.

Training must include:

  • The WVPP plan and how employees can obtain copies;
  • The definitions and requirements of the law;
  • How to report workplace violence incidents or concerns without fear of reprisal;
  • Workplace violence hazards specific to employees' jobs, the corrective measures the employer has implemented, how to seek assistance to prevent or respond to violence and strategies to avoid physical harm;
  • The violent incident log and how to obtain copies of records; and
  • An opportunity for interactive questions and answers with a person knowledgeable about the employer's plan.

Additionally, training is required for all new employees, so employers should begin working this WVPP discussion into their onboarding process. The sooner, the better.

SB 699 and AB 1076: Prohibitions on Noncompete Agreements

Signed by Newsom on Sept. 1, SB 699 prohibits employers from enforcing noncompete agreements considered void and unenforceable under the California Business and Professions Code, Section 16600.

Set to go into effect Jan. 1, 2024, SB 699 states that any contract that is void under Section 16600 is unenforceable regardless of where and when the contract was signed — meaning an out-of-state employer that attempts to enforce a noncompete in California would be bound to the requirements of this law.

Similarly, AB 1076 amends Section 16600 to further clarify prohibitions on noncompete agreements and codify existing precedent on the topic, in accordance with the Supreme Court of California's 2008 decision in Edwards v. Arthur Andersen LLP. The bill was signed into law this October. 

Specifically, Section 16660 should now be construed broadly to void all noncompete clauses in an employment context, regardless of how narrow they may be, unless they are encompassed by one of three narrow exceptions.

These exceptions include noncompetes associated with the sale of a partnership, dissolution of a partnership or dissolution of limited liability interests.

In addition, AB 1076 adds new Section 16600.1, which provides that it is unlawful for employers to include noncompete clauses in an employment contract.

This bill also applies retroactively as of Jan. 1, 2022; any individuals who were employed after this date with a noncompete clause must be notified that those noncompete clauses are now void.

Employers are required to render this notice by Feb. 14, 2024, to the individual's last known address and email address.

Tips and Takeaways

While California has long disfavored noncompete agreements, SB 699 and AB 1076 expand these prohibitions and impose strict new policies and potential liability on employers, including retroactive notice requirements on employers.

This aggressive legislation targets current employers with California employees or employers looking to hire California residents for remote work, so its reach is far and wide and affects all employers in the state.

Employers are advised to ensure they are complying with notice requirements and updating their agreements as necessary.

Employers should be prepared to revise offer letters, confidentiality agreements and other employment-related documents that might contain clauses that could expose employers to liability.

Employers have a duty to inform employees of changes to previously issued agreements or policies.

Conclusion

With constantly evolving employment laws, employers should remain vigilant to keep up with these changes.

As the calendar turns to 2024, companies should carefully review these issues and create policies, strategies and training programs that balance legal compliance with the specific needs of their business.

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