AB-5: ‘the freelancer law’

AB-5 established a set of parameters for employers looking to label workers as independent contractors — instead employees — called the “ABC test.”

To be an independent contractor, the law requires that workers:

  1. Be free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact.
  2. Perform work that is outside the usual course of the hiring entity’s business.
  3. Be customarily engaged in an independently established trade, occupation or business of the same nature as that involved in the work performed.

Industries exempt from the law are mostly in professional services or trades, such as doctors, electricians, independent consultants, architects and accountants. A recent ruling of the Superior Court of California in Los Angeles also exempted independent truckers from this law.

Media companies that rely on freelancers for blogging, reporting, photography and management of web properties also may be heavily affected. Vox Media, for example, recently laid off all California-based freelancers with plans to replace them with employees. The law also states a limit on the number of “submissions” a freelancer can contribute in a year and also defines what constitutes a submission.

“To designate workers as something other than an employee puts the onus on the workers to provide for their own insurance, to seek legal recourse through individual legal names,” Pearce said. “So a lot of burden that is placed on the worker when the worker’s relationship with the paying entity is not exactly equal.”

AB-51: Preserving the right to legal recourse

Another new state law would prohibit the use of some mandatory arbitration agreements as a condition of employment, but remains under a temporary restraining order (TRO) blocking it from taking effect. The TRO came just in time, Dec. 30, on the grounds that the law may stand in conflict with the Federal Arbitration Act.

The language of the bill does not specify arbitration, but rather prohibits companies or people “from requiring any applicant for employment or any employee to waive any right, forum, or procedure for a violation of any provision of the California Fair Employment and Housing Act (FEHA) or other specific statutes governing employment as a condition of employment, continued employment, or the receipt of any employment-related benefit.”

SB-188: Protection from discrimination based on hairstyle

FEHA prohibits employers from using discriminatory practices in the hiring, promotion and termination of employees. SB 188 added hairstyle, including “such hairstyles as braids, locks, and twists,” to the list of protected traits.

AB-673 & SB-688: Penalties for late or incorrect wages

AB-673 updates existing labor code so employees can seek penalties for late wage payments. The penalty is $100 for the first violation. For further violations or anything deemed intentional, the penalty is $200 for each violation plus 25% of the wages owed.

SB 688 expands on existing labor codes to levy the same penalties for failure to pay minimum wage to companies that pay or cause an employee to be paid “a rate of compensation that is less than set by contract.”

New minimum wages and minimum salary

With the new year, the state minimum wage became $13.00 per hour for employers with 26 or more employees and $12.00 per hour for employers with 25 or fewer employees. Additionally, the state’s salary threshold of overtime exemption is now $54,080 for employers with 26 or more employees and $49,920 for employers with 25 or fewer employees.

AB-1223: Leave of absence after organ donation

This law entitles employees to an additional 30 days of unpaid leave, in addition to 30 days of paid leave already permitted, to donate an organ.

AB-9: Employment discrimination statute of limitations

AB-9 extended the filing period for complaints of unlawful or discriminatory employment practices from one year to three years.

SB-778: Sexual harassment training guidelines

SB-778 sets out new sexual harassment training requirements. Employers with five or more employees must provide at least two hours of training on sexual harassment to anyone who manages other employees and at least one hour of training to “nonsupervisory” employees by Jan. 1, 2021. Thereafter, the training must be given again once every two years. The training must be provided within six months of hire or within six months of the assumption of a supervisory position.

SB-142: Lactation accommodation

SB-142 requires that work locations have rooms for lactation that are “safe, clean, and free of hazardous materials.” Rooms must also contain a surface to place a pump and personal items. Employers must also provide access to electricity or alternative devices and access to a sink and a refrigerator near the employee’s workspace. Employers with fewer than 50 employees may seek a hardship exemption.

AB-25: California Consumer Privacy Act

The California Consumer Privacy Act grants consumers certain rights regarding personal information that is owned by businesses. This includes the right to request disclosure of the specific kinds of personal information a company has collected and to have information deleted. AB-25 offers some clarification as it relates to data collected through the employment process.

There are three main points to AB-25 that are relevant to the start of 2020. First, disclosures extend to personal information collected from job applicants, employees or contractors. Second, businesses must have appropriate cybersecurity measures to protect sensitive data. Finally, those subject to the law must disclose the categories and business purposes for which information is being used. Employers must meet all consumer standards by Jan. 1, 2021.

AB-749: Ban on no-rehire provisions in settlement agreements

AB-749 says that settlement agreements between an “aggrieved person” and an employer can no longer contain a provision that restricts an employee from obtaining future employment with that employer and any affiliated entities such as franchises or subsidiaries.

“Aggrieved persons,” are defined as people who have filed a claim against their employer “in court, before an administrative agency, in an alternative dispute resolution forum, or through the employer’s internal complaint process.”

Employers can terminate employees or not rehire them “if there is a legitimate non-discriminatory or non-retaliatory reason for terminating the employment relationship or refusing to rehire the person” or if the individual committed harassment or sexual assault.