New California Law to Classify Employees and Independent Contractors

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On September 11, 2019, California lawmakers passed California Assembly Bill 5 (AB 5), codifying and clarifying the California Supreme Court’s landmark 2018 decision in Dynamex Operations West, Inc. v. Superior Court of Los Angeles, which fundamentally altered the test for determining the classification of workers as employees or independent contractors in California. We previously blogged about the Dynamex decision, under which workers are presumed to be employees for purposes of claims for wages and benefits arising under Industrial Welfare Commission wage orders, and companies must meet a three-pronged “ABC” test to overcome this presumption and establish that an individual is an independent contractor. AB 5 would codify the ABC test into law.

AB 5 has been sent to Governor Gavin Newsom, who recently endorsed it in an op-ed for the Sacramento Bee, and he is expected to sign it into law.

Under AB 5, a new Section 2750.3 would be added to the California Labor Code. Section 2750.3, subsection (a)(1), will state that, for purposes of the Labor Code, the Unemployment Insurance Code, and the wage orders of the Industrial Welfare Commission, a person providing labor or services for remuneration shall be considered an employee rather than an independent contractor unless the hiring entity demonstrates that all of the following conditions are satisfied:
(A) The person is 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;
(B) The person performs work that is outside the usual course of the hiring entity’s business; and
(C) The person is customarily engaged in an independently established trade, occupation or business of the same nature as that involved in the work performed.

Under the new law, California workers can generally only be considered independent contractors if the work they perform is outside the usual course of a company’s business. Conversely, a company must classify workers as employees if the company exerts control over how the workers perform their duties, or if their work is part of a company’s regular business.

AB 5 has far-reaching implications for California businesses who classify their workers as independent contractors because it extends the scope of the Dynamex ruling from only Industrial Wage Commission Orders to include claims for wages and benefits under the Labor Code and Unemployment Insurance Code. The Dynamex decision applied only to rules governing minimum wages, overtime and meal and rest breaks, but under AB 5, individuals classified as employees must also be afforded workers’ compensation in the event of an industrial injury, unemployment and disability insurance, paid sick days and family leave.

However, AB 5 is also narrower than the Dynamex decision in that it exempts certain occupations from the new test. The new Labor Code section would provide limited exemptions for certain occupations, including direct sales salespersons, licensed estheticians, licensed electrologists, licensed manicurists (until January 1, 2022), licensed barbers and licensed cosmetologists from the application Labor Code Section 2750.3 and the holding in Dynamex, provided that the individual:
• Sets their own rates, processes their own payments, and is paid directly by clients;
• Sets their own hours or work and has sole discretion to decide the number of clients and which clients for whom they will provide services;
• Has their own book of business and schedules their own appointments;
• Maintains their own business license for the services offered to clients; and
• If the individual is performing services at the location of the hiring entity, then the individual issues a Form 1099 to the salon or business owner from which they rent their business space.

If a company can meet its burden of showing that the individual meets the above criteria, then the determination of proper classification for that individual would be governed by S.G. Borello & Sons, Inc. v. Department of Industrial Relations, the 1989 decision that has been the prevailing law for wage order cases in California prior to Dynamex. Borello established an 11-factor inquiry into the degree of control a company exerts over the worker’s performance of his or her duties: whether the hiring entity has the right to control the manner and means of accomplishing the result desired; the right to discharge at will, without cause; whether the worker is engaged in a distinct occupation or business; the kind of occupation and the skill required in the particular occupation; who supplies the instrumentalities, tools and the place of work for the person doing the work; the length of time for which services are to be performed; the method of payment; whether or not the work is part of the hiring entity’s regular business; and whether or not the parties believe they are creating an employer-employee relationship.

Another aspect of AB 5 worth noting is that it would not allow an employer to reclassify an individual who was an employee on Janaury 1, 2019 to an independent contractor due to the measure’s enactment.

With the law set to become effective on January 1, 2020, companies, particularly in the salon and beauty industry, would be wise to reassess the classification of their workers to ensure compliance with the new law. The attorneys at Conkle, Kremer & Engel have extensive experience advising businesses on best practices regarding proper worker classification, and will be continually monitoring developments related to AB 5 as they occur.

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California Expands Sexual Harassment Training Requirements to Most Employers

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As usual, a new year means new laws, especially in California.  For 2019, one law that all employers need to be aware of is SB1343, which amended Government Code Sections 12950 and 12950.1 to impose new sexual harassment training requirements on most employers.  Previously, only employers of at least 50 employees were required to train their supervisory employees.  Starting now, if you have 5 workers, including both employees and contract workers, you have to comply with several training requirements:

  • – Within the next year, all supervisory employees must complete two hours of sexual harassment training.

– The definition of “supervisor” is fairly broad and covers more than just your managers. Under California Government  Code 12926(t), “Supervisor” means “any individual having the authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or the responsibility to direct them, or to adjust their grievances, or effectively to recommend that action, if, in connection with the foregoing, the exercise of that authority is not of a merely routine or clerical nature, but requires the use of independent judgment.”

  • – Within the next year, all nonsupervisory employees must complete one hour of sexual harassment training.
  • – For all employees, the training must be provided within six months of the employee’s assumption of a position with the company.
  • – After January 1, 2020, each employee must receive sexual harassment training once every two years.
  • – Beginning January 1, 2020, seasonal and temporary employees, and any employees hired to work for less than six months, must receive sexual harassment training within 30 calendar days after the hire date or within 100 hours worked, whichever occurs first. If the temporary employee is employed by a temporary services employer (i.e., a temporary staffing agency), the temporary services employer is required to provide this training, not the client.

California’s Department of Fair Employment and Housing (DFEH) is required to develop online sexual harassment training courses.  DFEH has stated that it expects to have such training programs available on its website by late 2019.  If they are available on time, employers can direct their workers to those online courses, but otherwise employers must develop or provide their own training.

Employers should also take this as a reminder to check your work site and make sure you have prominently displayed the required posters.  For example, California law requires employers to display the DFEH poster regarding workplace discrimination and harassment in a prominent and accessible location in the workplace, and to distribute a sexual harassment prevention brochure to their employees.

Constant vigilance is required for employers to comply with rapidly changing requirements.  Employers should consult with experienced counsel particularly in regard to interpretation of new requirements such as these.  Conkle, Kremer & Engel attorneys are experienced with counseling employers in the face of the changing legal landscape in employment law.  CK&E attorneys help companies identify and reduce areas of exposure to liability for employment claims, including wage and hour, discrimination, harassment, and retaliation claims.

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California’s New, Stricter Test for Independent Contractors and Employees

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Does Your Business Pass California’s New, Stricter Test for Independent Contractors Rather Than Employees?

On April 30, 2018, the California Supreme Court issued a decision in Dynamex Operations West, Inc. v. The Superior Court of Los Angeles County that will make it more difficult for employers to classify their workers as independent contractors.  Under the new Supreme Court test, workers are presumed to be employees, not independent contractors.  Incorrect classification can have serious consequences.

Previously, many California employers thought an agreement stating a worker was an independent contractor was enough.  No more.  The Supreme Court has adopted a strict “ABC” test to determine whether a worker is properly classified as an “employee” or as an “independent contractor.”  Under this test, the Court presumes a worker is an “employee” unless the hiring business can establish that the worker meets all three conditions of an independent contractor:

(A) that the worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work and in fact;

(B) that the worker performs work that is outside the usual course of the hiring entity’s business; and

(C) apart from the independent contractor relationship, the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity.

The presumption means that when in doubt employers should err on the side of classifying their workers as employees.  An employer that misclassifies a worker as an independent contractor can be liable for back wages and wage and hour penalties, including willful misclassification penalties that can range from $5,000 to $25,000 per violation.  These issues may be raised by the worker after the “independent contractor” relationship has ended.

If your workers do not meet this new 3-part test for independent contractors, make sure you re-classify them as employees and pay them all the wages and benefits given to your employees under the wage and hour laws, deduct payroll taxes, cover them under your worker’s compensation insurance, and generally treat them like your other employees.

If you have questions about how the new decision applies, or whether your workers meet the new strict ABC test for independent contractors, you should promptly consult with experienced employment counsel.  Conkle, Kremer & Engel attorneys have years of experience in employment matters, advising businesses and litigating and arbitrating disputes, including class actions.

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Do You Have to Pay Your Summer Interns?

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Do I Have to Pay My Interns?

Spring will soon draw to a close.  As you prepare for the arrival of your summer interns, make sure you have asked yourself this question: Do I need to pay my interns?

The easiest answer is generally, YES!  But the easiest answer is not the whole story, because you do not have to pay your interns in accordance with wage and hour laws if the company-intern relationship meets the federal (and state, as applicable) test.

The U.S. Department of Labor’s New Test

Earlier this year, the U.S. Department of Labor helped private businesses out.  It announced that it would be using a new (more employer-friendly) test to determine whether an intern is an “employee” that must be paid in compliance with wage and hour laws.  Whether an intern must be paid in compliance with federal wage and hour laws now depends on seven factors:

  • The extent to which the intern and the company clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee—and vice versa;
  • The extent to which the internship provides training that would be similar to that which would be given in an educational environment, including the clinical and other hands-on training provided by educational institutions;
  • The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit;
  • The extent to which the internship accommodates the intern’s academic commitments by corresponding to the academic calendar;
  • The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning;
  • The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern; and
  • The extent to which the intern and the company understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.

According to the DOL, “no single factor is determinative.”  Thus, companies need to conduct a case-by-case analysis of each internship position to determine whether that intern should be paid.

I’m Located in California.  Do I Need to Be Concerned About State Laws Controlling Wage and Hour Requirements?

Here, the clear answer is YES!  For many years, the California Department of Labor Industrial Relations, Division of Labor Standards Enforcement (“DLSE”) has relied on the DOL’s old six-factor test.  For now, California businesses should also look to the DOL’s old six-factor test to determine whether they need to pay their interns.

The DOL’s adoption of this new seven-factor test this year followed a decision in the Ninth Circuit (which covers California).  In 2017, the federal Ninth Circuit Court of Appeals made a predictive statement, that the California Supreme Court would no longer use the old DOL test, and would instead apply a test more similar to the one set forth above.  Benjamin v. B & H Educ., Inc., 877 F.3d 1139 (9th Cir. 2017).  However, this statement is only predictive of what the federal court thinks the California courts would do, so it is not actually controlling law in California.

Thus, until the California state agencies and courts take a position on whether they will follow the Ninth Circuit and the DOL, companies should also check that they have considered the DLSE’s interns test to make their decision to pay (or not pay) interns.  That requires an analysis under the DOL’s old six-factor test:

  • The internship, even though it includes actual operation of the facilities of the company, is similar to training which would be given in an educational environment;
  • The internship experience is for the benefit of the intern;
  • The intern does not displace regular employees, but works under close supervision of existing staff;
  • The company that provides the training derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded;
  • The intern is not necessarily entitled to a job at the conclusion of the internship; and
  • The company and the intern understand that the intern is not entitled to wages for the time spent in the internship.

If you have not examined your internship programs with these federal and state legal considerations in mind, you should do so immediately, before your summer interns arrive.  Review your internship materials, including your recruitment postings, company policies, and any other documents you anticipate having the intern sign before starting the summer program.

Conkle, Kremer & Engel attorneys are experienced with counseling employers in the face of a constantly changing legal landscape in employment law, and with helping companies identify and reduce areas of exposure to liability for employment claims, including wage and hour, discrimination, harassment, and retaliation claims.

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California’s Cleaning Product Right to Know Act Requires Ingredient Disclosure

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California became the first state in the nation to have a cleaning products disclosure law, after Governor Brown signed the Cleaning Product Right to Know Act of 2017 (S.B. 258 (Lara)) into law in late 2017.

The Cleaning Product Right to Know Act requires manufacturers of certain cleaning products sold in California to disclose on the product label and on the product’s Internet web site certain information related to known hazardous chemicals contained in the product.  Manufacturers will have until January 1, 2020 to comply with the online disclosure requirements, and until January 1, 2021 to comply with the product label disclosure requirements.  However, any intentionally added ingredient that is regulated by California’s Safe Drinking Water and Toxic Enforcement Act (commonly known as Proposition 65) will not have to be listed until January 1, 2023.

The new law applies to so-called “designated products”, which are defined as a finished product that is an air care product, automotive product, general cleaning product, or a polish or floor maintenance product used primarily for janitorial, domestic or institutional cleaning purposes.  It does not apply to foods, drugs and cosmetics, trial samples, or industrial products specifically manufactured for certain industrial manufacturing processes.

The product label will be required to disclose each intentionally added ingredient contained in the product that is included on any of 22 specified designated chemical lists – including chemicals listed pursuant to Proposition 65.  Alternatively, manufacturers may list all intentionally added ingredients contained in the product unless it is confidential business information.  The Act also requires the disclosure of fragrance allergens greater than 0.01 percent (100 ppm).  Additional requirements include the manufacturer’s toll-free telephone number and Internet web site address on the product label.

As for the online disclosure requirements, manufacturers must list all intentionally added ingredients and state their functional purpose.  All nonfunctional constituents present at above 0.01 percent (100 ppm) must also be listed.  The website must include electronic links for designated lists and a link to the hazard communication safety data sheet for the product.  In addition, specific requirements apply for the disclosure of fragrance allergens online.

The Act also adds a section to the California Labor Code imposing an obligation on employers who are required to provide employees with Safety Data Sheets (SDS).  Those employers must similarly make the printable information from the online disclosure available in the workplace.

Although it is a state law, the effect of the Cleaning Product Right to Know Act is certain to be felt by manufacturers across the country who sell their products into California, as is true of many of California’s other regulatory schemes, including Proposition 65, and will most likely result in a nationwide relabeling of covered products.

Given the Act’s numerous and in some cases highly technical requirements, manufacturers of cleaning products would be well advised to determine whether any of their products are subject to the Act, and take steps now to ensure compliance by 2020.  Conkle, Kremer & Engel attorneys stand ready to help manufacturers handle all that is coming their way.

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How Does Marijuana Legalization Affect Employer Workplace Policies?

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Do I have to change my drug-free workplace policy now that marijuana is legal?

On January 1, 2018, recreational marijuana became legal in California.  That raises a few questions, to put it mildly.  For California employers and employees, one of the first questions is, must employers change their drug-free workplace policies now that cannabis use is legal?

Generally speaking, the answer is no.  A California employer can still keep its drug-free workplace policy (as long as it was legally compliant before January 1) that prohibits the use of alcohol and drugs, including cannabis, in the workplace.  There is even a California Health and Safety Code statute protecting employers: The legalization of cannabis use “does not amend, repeal, affect, restrict, or preempt…[t]he 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 cannabis in the workplace, or affect the ability of employers to have policies prohibiting the use of cannabis by employees and prospective employees, or prevent employers from complying with state or federal law.”

Does this mean I can terminate an employee who tests positive for cannabis?

Yes, if you have a zero-tolerance policy that provides for dismissal of employees who test positive for drugs.  An employer can keep its drug-free workplace policy and test employees for alcohol and drugs, including cannabis, in compliance with the law.  That means that an employer can refuse to hire an employee who tests positive for cannabis.  It also means that an employer can ask an employee to take a drug test when the employer reasonably suspects the employee is under the influence of any substances prohibited under the employer’s policy.  An employer can terminate an employee who refuses to take the test, or who tests positive for those prohibited substances, including cannabis.

What if the employee is using marijuana to treat a disability?

With all the medical leave and disability discrimination laws protecting employees with certain medical conditions, employers are also understandably nervous about terminating an employee who relies on medical marijuana.  For now, employers can rest easy.  Because federal law still prohibits cannabis use, both state and federal law refuse to protect the employee’s illegal drug use, even if the employee is using medical marijuana, with a prescription, to treat a medical condition.

Of course, cannabis law is quickly evolving.  From legalizing marijuana at the state level in parts of the country, to rescinding “hands-off policies” at the federal level that were intended to leave states to decide on the cannabis issue on their own, cannabis laws are subject to change.  Employers should keep a close eye on the interaction between federal and state laws on cannabis use, and be prepared to modify their drug policies as needed.

Conkle, Kremer & Engel attorneys are experienced with counseling employers who face a constantly changing landscape of laws, ordinances, and regulations, and resolving employment issues as they arise.

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Can Employers Ask, “So, What Did You Make?”

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A new law in California is squarely aimed at reducing historical wage disparity, particularly between male and female employees.  On January 1, 2018, a new law will take effect in California to prohibit employers from seeking “salary history information, including compensation and benefits, about an applicant for employment.”  The new law, Section 432.3 of the Labor Code, also requires employers to provide the pay scale of the position to the applicant upon reasonable request.

But even under this new law, employers can still access salary history information under certain circumstances.  Employers may review salary history information that is publicly available under federal or state law, including information that is obtainable under the California Public Records Act or the federal Freedom of Information Act.  Employers may also consider and rely on salary history information in determining the salary for that applicant, if the “applicant voluntarily and without prompting discloses salary history information to a prospective employer….”  But, even when employers can rely on voluntarily disclosed salary information to set a particular salary, job applicants are still protected by California’s Equal Pay Act.  Any prior salary information about the applicant still cannot be used as the sole justification for “any disparity in compensation” for employees of different sexes, races, or ethnicities for “substantially similar work.”

It seems likely there will be a challenge to the constitutionality of the new restriction, most likely on free speech grounds.  Other states and municipalities have passed similar laws restricting employers from inquiring about salary history.  Philadelphia has a similar ordinance passed earlier this year to prohibit employers from asking an applicant about prior salaries and from relying on salary information unless that information was voluntarily disclosed by the applicant.  The Chamber of Commerce for Greater Philadelphia filed a lawsuit, challenging the ordinance on several grounds, including “chilling” the protected speech of employers under the First Amendment, and violating the Due Process Clause of the Fourteenth Amendment because of the severe penalties employers risk incurring.  While this case is still pending, the Chamber of Commerce raises questions of constitutionality that could apply as well to California’s new law.

Employment laws change constantly at federal, state and local levels.  In preparation for the new year, employers should review the documents they use in the hiring process, including job applications and new hire documents, and remove questions pertaining to salary history.  Employers should also instruct any employees who may be interviewing applicants not to ask about an applicant’s salary history.  And, for each open position, employers should ensure pay scales are readily available to disclose in response to an applicant’s request.

Conkle, Kremer & Engel attorneys are experienced at helping employers navigate the shifting maze of laws and regulations they face, and resolving employment issues as they arise.

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California Employers’ Risks of PAGA Exposure

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If you’re a California employer, you may have heard people refer to “PAGA” and wondered what it’s all about.  PAGA is a legal device that employees can use to address Labor Code violations in a novel way, in which employee representatives are allowed to act as if they are government enforcement agents.

The California Labor and Workforce Development Agency (CLWDA) has authority to collect civil penalties against employers for Labor Code violations.  Seems simple enough.  But in an effort to relieve an agency with limited resources of the nearly impossible task of pursuing every possible Labor Code violation committed by employers, the California legislature passed the Private Attorney General Act of 2004 (“PAGA”).  PAGA grants aggrieved employees the right to bring a civil action and pursue civil penalties against their employers for Labor Code violations, acting on behalf of the State of California as if they were the CLWDA.  If the aggrieved employees prevail against the employer, the employees can collect 25% of the fines that the state of California would have collected if it had brought the action.

Penalties available for Labor Code violations can be steep – for some violations, the state of California can recover fines of $100 for an initial violation to $200 for subsequent violations, per aggrieved employee, per pay period.  These penalties can add up to serious money, especially if the aggrieved employee was with the company for some time.  But what makes PAGA particularly dangerous for employers is the ability of employees to bring a representative action (similar to a class action), in which they can pursue these penalties for violations of the Labor Code on behalf of not only themselves, but also all others similarly situated.  Under this scheme, an aggrieved employee can bring an action to pursue penalties on behalf of an entire class of current and former employees, thereby multiplying the penalties for which an employer can be on the hook and ballooning the risk of exposure.  That risk is further amplified because PAGA also permits plaintiff employment attorneys to recover their fees if their claim is successful.

There is an upward trend in use of PAGA against California employers.  A July 2017 California Supreme Court decision, Williams v. Superior Court, exacerbated the problem for employers:  The California Supreme Court decided that plaintiff employment attorneys can obtain from employer defendants the names and contact information of potentially affected current and former employees throughout the entire state of California.  This means the PAGA plaintiffs can initiate an action and then pursue discovery of all possible affected employees and former employees throughout California, which can greatly expand the pool of potential claimants and ratchet up the exposure risk for employers.

Employers in California need to be attuned to Labor Code requirements and careful in their manner of dealing with employees, so that they avoid exposure to PAGA liability to the extent possible.  Conkle, Kremer & Engel attorneys are familiar with the latest developments in employment liability and able to assist employers avoid trouble before it starts, or respond and defend themselves if problems have arisen.

 

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Fire Your Employee for His Noxious Memo? Not So Fast.

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Is an employer free to fire an employee who circulates to co-employees a memo expressing ideas that are noxious to the employer’s efforts to avoid prohibited discrimination?  Perhaps surprisingly, the answer can be, “No.”

A good example is the recent event in which Google fired James Damore, an engineer, for circulating a memo, or “manifesto,” explaining a basis for gender bias among computer engineers.  His memo, entitled, “Google’s Ideological Echo Chamber – How bias clouds our thinking about diversity and inclusion,” purported to be a personal response to what he viewed as the shaming and silence of those in his field who have differing views about gender in the workplace, and whose views are inconsistent with Google’s “dominant ideology.”  In the memo, Damore provided what he called “biological” explanations for why there is a gender gap in technology, such as: women are more neurotic and thus tend to pick less stressful jobs; women are more “directed towards feelings and aesthetics rather than ideas;” and men have a higher drive for status.  Damore posted this screed to Google’s internal messaging board.  It was a message to his co-workers, and hostile to his employer’s position.

As Damore acknowledged, engineering at Google requires collaboration and teamwork.  Damore’s statement put Google’s management in a difficult place – how can Damore continue to work on any team that involves women? Further, Google’s employee review process emphasizes peer reviews, particularly by high-level engineers such as Damore.  Damore’s expressed biases could cause questions as to the fairness of his reviews, and his position as a supervisor could be argued to create a hostile work environment for the female minority with whom he works.  It is not surprising, then, that Google employees reacted by demanding Damore be disciplined or terminated.  Google agreed, and Damore was terminated.

But Damore seems to have anticipated that reaction, and took steps to protect his own interests.  As quoted by the New York Times, Damore included in his memo an unusually lawyerly statement:  “I have a legal right to express my concerns about the terms and conditions of my working environment and to bring up potentially illegal behavior, which is what my document does.”  After the termination, Damore submitted a complaint to the National Labor Relations Board (NLRB) claiming that Google’s upper management was “misrepresenting and shaming me in order to silence my complaints,” and reminding Google that it is “illegal to retaliate” against an NLRB charge.

Was Google’s action defensible?  The National Labor Relations Act Sections 7 & 8(a)(1) (29 U.S.C. Section 157 & 158(a)(1)) makes unlawful violating employees’ rights to engage in “protected concerted activities.” “Concerted activities” are broadly defined to include “the right to self-organization, to form, join or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection….” Most often, “concerted activities” are associated with union activity, but the NLRB protects activity that is not specifically union oriented.  This can include communicating with coworkers regarding wages and working conditions, and expressing preferences for political candidates who support favorable labor issues such as higher wages for hourly workers.  In doing so, employees are permitted to use company bulletin boards, both electronic and physical, and company email, on non-working time.

The effect of this protection is that, if Damore challenges his termination, he will likely argue that Google’s decision to terminate him curtailed his rights to discuss his political beliefs and to engage like-minded employees about his view that the hiring and promotions practices at Google are unfair to men.

Because Damore works in California, there are additional considerations under state law.  California Labor Code §1101 provides that “No employer shall make, adopt, or enforce any rule, regulation, or policy: (a) Forbidding or preventing employees from engaging or participating in politics or from becoming candidates for public office; or (b) Controlling or directing, or tending to control or direct the political activities or affiliations of employees.”  While this may not control an adverse employment decision by an employer against a single individual, once coworkers learn that an employee was fired based on his speech or political activities, those coworkers may perceive that action as a threat or policy.  As the Supreme Court has recognized, employees’ economic dependence on the employer can reasonably lead them to pick up even subtle signals when their jobs are at stake.  NLRB v. Gissel Packing Co., 395 U.S. 575, 617 (1969).  Here, Damore’s like-minded coworkers could interpret his firing as a threat to their employment should they express views similar to his.

The unfortunate upshot for Google is that Damore’s termination seems like a retaliation claim ripe for filing.  Though many may personally disagree with Damore’s views on gender in the workplace, and he may have absolutely no factual or evidentiary basis for his position, he could argue in an action against Google that he was attempting to organize a group of like-minded workers to oppose what he believes are Google’s gender biases or an unfair reverse discrimination policy. His “manifesto” appears to structured for this very argument.

It is ironic that the policies of the NLRB and California Labor Code, which protect political organization and prohibit retaliation, are what may ultimately force Google to suffer legal liability for Damore’s termination for expressing disagreement with Google’s anti-discrimination policies.

As these events demonstrate, the application of employment law and policies in real world situations can be challenging.  Protection of one worthwhile policy can seemingly conflict with others, and well-meaning employers can find themselves having to make very difficult choices.  Employers should consult counsel experienced in the sometimes complex issues that can arise in many different employment circumstances.

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No Fooling! On April 1, Almost All Employers are Subject to New Employment Regulations in California

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Effective April 1, 2016, new regulations of the California Department of Fair Employment and Housing (DFEH) impose stringent new anti-discrimination and anti-harassment requirements on almost all employers having any employees in California.  Unlike in the past, the new amendments to regulations under California’s Fair Employment and Housing Act (FEHA) apply to any employer having five or more “employees,” any of whom are located in California.  The word “employees” is important, because the new FEHA regulations count toward the minimum of five “employees” unpaid interns, volunteers and persons out on leave from active employment.  Further, it appears that this new FEHA regulation is intended to apply even to employers with headquarters outside of California if any of their employees are located in California.

The FEHA regulatory amendments require all affected employers to have written policies prohibiting workplace discrimination and harassment.  The policies must apply to prohibit discrimination and harassment by co-workers, who are made individually liable for their own violations, and by third parties such as vendors in the workplace.  The regulations demand that the written policy list all currently-protected categories protected under FEHA:  Race, religion, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, sexual orientation, and military or veteran status.  Prohibited “sex discrimination” includes discrimination based on pregnancy, childbirth, breastfeeding and related medical conditions.  Interestingly, the regulations also prohibit discrimination against employment applicants holding a special California driver’s license issued to persons without proof of legal presence in the United States.  It is not yet clear how this will work in conjunction with the employer’s existing Federal obligation to confirm eligibility for employment.

The employer’s written policy must specify a confidential complaint process that satisfies a number of criteria.  Workplace retaliation for making good faith complaints of perceived discrimination or harassment is prohibited.  The written policy must be publicized to all employees, with tracking of its receipt by employees.  If 10% of the employer’s work force speaks a language other than English, the written policy must be translated to that language.

Further, the new regulations attempt to resolve a number of uncertainties about who is protected, specifying that both males and females are protected from gender discrimination, and requiring that transgender persons be treated and provided facilities consistent with their gender identity.  There are many other changes, such as a new entitlement to four months for pregnancy leave that is not required to be taken continuously.  If an employer has more than 50 employees, there are additional requirements, such as periodic sexual harassment prevention training for supervisors.

Employers operating in California are well advised to review their policies and practices, and to consult with qualified counsel regarding changes that may be required.  Conkle, Kremer & Engel attorneys help clients remain compliant with laws, regulations and case developments affecting employers in California.

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