New California labor laws employers should know

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During his first year in office, California Governor Gavin Newsom signed an abundance of bills into law, many of which go into effect on January 1, 2020. Every employer in California needs to be aware of these new laws and how they could affect operations.

Below are some of the most significant new labor laws:

AB5 has been in the news often throughout 2019, as it has been very controversial. It changes the standard by which workers are classified as either employees or independent contractors. Called the “ABC test,” it standardizes the three conditions that must be met for an employer to classify a worker as an independent contractor. They are:

  • The person must 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.
  • The person must perform work that is outside the usual course of the hiring entity’s business.
  • The person must customarily be engaged in an independently established trade, occupation or business of the same nature as that involved in the work performed.

AB5 will not automatically change the classification of any workers upon its implementation at the beginning of the year. However, employers should be sure to classify all workers appropriately to avoid the serious consequences of a violation of the law.

AB51 bans forced arbitration agreements and prohibits discrimination or retaliation against an employee or applicant who refuses to sign one.

SB188 prohibits discrimination against natural hairstyles, such as those associated with people of color like dreadlocks, braids and afros. Employers may not create dress codes that prohibit these styles unless there is a legitimate safety or security concern and they may not refuse to hire someone based on these hairstyles.

AB9 extends the amount of time an employee has to file a discrimination, harassment or retaliation complaint with the Department of Fair Employment and Housing against an employer from one year to three.

AB749 forbids no-rehire policies for employees who file complaints against their employers for discrimination, sexual harassment or another violation.

A minimum wage increase is also planned to go into effect on January 1. Although this one was signed into law by former Governor Jerry Brown in 2015 as a step in his plan to eventually raise the minimum wage to $15, it is still a big change for employers. Workers at companies with 26 or more employees must be paid at least $13 and those at companies with fewer employees must be paid at least $12.

Employers are responsible for knowing the new laws and ensuring that their own operations are compliant. However, California workers also must be aware of the upcoming changes to be sure that their rights are not violated at work.