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(November 2001)
New California Legislation (Update)

Applies to
See each individual legislation description, or call Waag and Co. for more information.
Effective Date
January 1, 2002 (unless noted)
Synopsis

The current legislative session in California is now closed, and the deadline for action by Governor Davis has passed. Accordingly, we now know the fate of the employment-related bills that were active this past year, and what will (or will not) be the law in California as of January 1, 2002. Also noted are some changes in federal that will become law on January 1, 2002. Employers will need to review their personnel policies and practices to ensure that they will be in compliance with the latest legislative mandates.

Part 1: State Bills that will become Law January 1, 2002

A.B. 800 English-Only Rules: This law imposes new restrictions on an employer's ability to set workplace language rules. This bill amends the Fair Employment and Housing Act ("FEHA"), to outlaw the so-called "English Only" rules in the workplace. The new statute will make it unlawful for an employer to adopt or enforce a policy that prohibits the use of any language in the workplace unless the policy is justified by "business necessity" and appropriate notice of the policy and its consequences for violation of the policy is given to employees. For the purpose of this statute, "business necessity" means "an overriding legitimate business purpose such that the language restriction is necessary to the safe and efficient operation of the business, that the language restriction effectively fulfills the business purpose that it is supposed to serve, and there is no alternative practice to the language restriction that would accomplish the business purpose equally well with a lesser discriminatory impact."

A.B. 1025 New Accommodations for Nursing Mothers: This new law requires employers make certain accommodations to breastfeeding mothers. This includes reasonable amounts of break time to accommodate an employee desiring to express breast milk for her infant. The break time shall, if possible, run concurrently with any breaks that are already provided. Any breaks that do not run concurrently with existing breaks may be unpaid. The employer will not be required to provide the extra break time if to do so would seriously disrupt the employer's operations. Employers must also make a reasonable effort to provide a suitable, private location (not a bathroom stall) for breastfeeding mothers to express milk at work. Such location must be in close proximity to the employee's work area. Numerous issues remain unclear: How frequently must a nursing mother be given a break to express milk? Can a women be required to adhere to a specific pumping schedule? at what point would an accommodation be said to seriously disrupt operations? How private is private? Would a women's lounge area where women only are allowed be private enough?

A.B. 25 Domestic Partnerships: This bill was passed into law on 10/14/01. This bill makes numerous changes with respect to the legal rights of registered domestic partners, affording such relationships several of the legal benefits associated with marriage. With respect to employment, the new law makes three significant changes:

(1) group health and disability insurance carriers must now offer employers the option of including domestic partners as dependents for the purpose of coverage;

(2) employers who provide paid sick time must allow employees to use some of this paid time to attend to the illness of a child, parent or spouse - the new law will add domestic partner and the child of a domestic partner to this list; and

(3) an employee who quits a job in order to accompany one's domestic partner to a new geographic area will be eligible for unemployment benefits to the same extent as would a spouse who quits for this reason.

S.B. 40 Unemployment Insurance Benefit Increase: This bill will increase availability and amount of unemployment insurance benefits. Under the new law, an unemployed individual will not be disqualified for eligibility for unemployment benefits solely on the basis that s/he is only available for part-time work. The bill also provides that any wages paid in lieu of notice under the federal Worker Adjustment Retraining and Notification ("WARN") Act will not be counted as payment for services in determining eligibility for unemployment benefits. The bill also alters the calculation of benefits. Currently, benefits are calculated at 39% of the claimant's average weekly wage, not to exceed $230 per week in benefits. Effective January 1, 2002, benefits will rise to 45% of the average weekly wage, not to exceed $330. After this initial increase, the maximum weekly benefit will increase by $40 each year until 2005.

A.B. 1475 Eliminate Religious Exemption Under FEHA: Amends the FEHA to eliminate part of the Act's exemption for religious entities. Under the new law, the FEHA's provisions prohibiting discrimination and harassment will now apply to persons employed by a religious entity who perform non-religious duties at a health care facility that is not restricted to adherents of the particular religion.

S.B. 20 Displaced Janitor Protection: This law is to protect "displaced janitors" when one contractor is replaced by a new contractor. Janitorial contractors and subcontractors on public works contracts must retain for 90 days certain janitorial employees employed at the site by the prior contractor.

S.B. 168: Workplace Privacy: This law prohibits businesses from printing Social Security numbers on ID cards and mailed documents or requiring individuals to use their Social Security number to access an Internet website.

A.B. 866 Child Care Assistance: This law extends two employer child care assistance tax credits, EFFECTIVE IMMEDIATELY, for tax years beginning before 2007. First, an employer may receive a credit of 30% of the cost of establishing or constructing an employee child care program or facility, up to $50,000. Second, an employer may take a tax credit of 30% of contributions to qualified child care on behalf of employees, up to $360 per child each year.

A.B. 1426 Child Support Withholding: If an employer willfully fails to comply with an earnings assignment order for an employee's child support, this bill authorizes a court order for an electronic transfer of funds from the employer's bank account. An employer that does not comply with an earnings assignment order three times in a 12-month period is subject to a penalty of up to 50% of the delinquent amount.

S.B. 446 Health Care: This law requires health care plans to provide coverage for FDA-approved AIDS vaccines that the U.S. Public Health Service recommends, but not for clinical trials of vaccines.

A.B. 1643 and A.B. 351 Background Checks: Under A.B. 1643, agencies that provide temporary licensed or certified nursing staff to long-term health care facilities must ensure that all staff meet requirements for licensing, experience and health; have a criminal background clearance; and have no unresolved allegations of patient abuse. A.B. 351 requires local governments to screen employment applicants and volunteers who supervise children at parks and other recreational facilities to ensure they have no convictions for sexual or violent crimes.

A.B. 1262 Motor Carriers: Every bus company or other motor carrier that regularly employs more than 20 full-time drivers must report to the California Highway Patrol whenever it replaces more than 50% of its drivers within a 30-day period. The CHP will then inspect the carrier within 21 days to ensure that it meets all safety requirements, including controlled substance abuse testing and hours-of-service rules.

A.B. 196 and A.B. 1194 Workers' Compensation: A.B. 196 expands the scope of injuries that are presumed to be work-related for safety employees, firefighters, and law enforcement personnel by including bloodborne infectious diseases such as AIDS. A.B. 1194 permits physicians assistants and nurse practitioners to sign first reports of on-the-job injuries and authorize an injured worker to be off work for three days. However, a physician must determine whether the worker qualifies for temporary disability benefits.

A.B. 423: Expands penalties for repeat wage and hour violations by farm labor contractors.

S.B. 1125: Allows farm labor contractors to use surety bonds and license fees to pay damages for labor law violations.

Part 2: State Bills that were Vetoed

A.B. 1635: This bill would have permitted employees to obtain a copy of their full personnel records upon request. Current law entitles employees only to obtain a copy of those personnel documents that they signed in order to obtain or maintain their employment. Note that current law already provides employees with the opportunity to review their records upon request.

S.B. 147: Electronic Monitoring: This bill would have required employers to execute agreements with their employees regarding the employer's right to monitor monitoring workplace e-mail or other computer records generated by an employee. In vetoing this bill, Governor Davis commented that employees are already aware that the computers owned by their employers are for business purposes, are company property and that their use may be monitored and controlled. The Governor further noted that since employers face liability for their employees' misuse of those systems, employers have a legitimate need for such control. The Governor stated that this particular bill imposed unreasonable burdens on employers, and that he would be open to a more reasonable approach to protecting any legitimate privacy rights of employees in their use of their employers' systems.

S.B. 71: Workers' Comp Benefits: This is the controversial bill that would have increased the benefits payable to workers under the workers' compensation system. While California is the 49th lowest paying state in terms of workers' compensation benefits, our system is nevertheless one of the most expensive. Governor Davis' concern in vetoing the bill is that it did nothing to address fraud or limit the cost of the program to businesses. The governor has said that he will work with the Legislature before the start of the 2002 legislative session to draft a compromise bill that increases benefits and addresses other workers' comp reform issues.

S.B. 208 Harassment Investigations: This bill would have authorized certified Human Resources consultants to conduct workplace harassment investigations. Under current law, only the only people who may lawfully conduct such an investigation are: a business' own employee, a licensed private investigator, or a licensed attorney. See The Strategic Employer, February 2000, page 12 for more information on this issue (go to www.WaagandCo.com, click on "NEWS", then click on "NEWSLETTERS", then select the February 2000 issue for downloading in PDF format).

S.B. 1197 Paid Sick Leave Discipline Restriction: This is a follow-on to the recent statute requiring employers to permit employees to use any paid sick leave for attending to the illness of the employee's parent, child or spouse. For more information, see The Strategic Employer, February 2000, page 4 (go to www.WaagandCo.com, click on "NEWS", then click on "NEWSLETTERS", then select the February 2000 issue for downloading in PDF format). This new bill would have prohibited employers from establishing any policies that would count such leave for disciplinary purposes. Because the policy itself would be unlawful, any employee subject to such a policy (even if never disciplined) would have standing to bring a claim. Note that even though this measure was vetoed, existing law still prohibits an employer from discriminating against an employee who uses paid sick leave in order to care for a parent, child or spouse.

Part 3: Other State Actions

Workers' Comp Rate Increase: Even though Governor Davis has vetoed bills that would have increased workers' comp benefits, the state Workers' Compensation Insurance Rating Bureau has recommended SUBSTANTIAL PREMIUM RATE INCREASES for California employers effective January 2002. I

Wage Order 5 Amended: Wage Order 5 (which covers Public Housekeeping Industry) was amended effective January 1, 2002. You can access the new Wage Order on the Industrial Welfare Commission's website. Note that two versions of Wage Order 5 will appear; the first is the current Order and the second is the one that will go into effect on January 1st. Employers in this industry will need to post the new Wage Order at that time.

State Minimum Wage Increase: As part of an earlier statute, California's minimum wage will increase to $6.75 per hour on January 1, 2002.

Part 4: New Federal Statutes

Expanded Retirement Savings and Tax Benefits: A number of changes were passed under the federal tax laws permitting employees to put away more money into their retirement savings plans, such as 401(k) and IRA accounts. New laws also provide incentives for small employers to sponsor retirement plans. Also, a new tax exclusion will permit employers to provide up to $5,250 per year in tax-free education assistance to an employee, and will apply to both graduate and undergraduate classes. More information on this is available by clicking here.

Mileage Reimbursement Rate Increase: Effective January 1, 2002, the IRS is raising the mileage reimbursement rate for businesses to use in deducting automobile costs from 34.5 cents to 36.5 centers per mile.

This material is a general overview of the subject matter, and is not meant to provide professional opinions regarding any specific case, matter, or set of facts, or to substitute for the professional advice of Waag and Co. Instead, please contact Susan S. Waag, Esq. for additional information. Use of this information is allowed, provided that credit is given to: Susan S. Waag, attorney; Waag and Co.; September 2001 Employer Bulletin; INFO@WaagandCo.com; (805) 783-2300

You can download the current and past Bulletins in PDF (Portable Document File) format where proceeded by below. All other Bulletins are in standard HTML format. If you do not have Adobe Acrobat Reader, which is required to open, view, and print the bulletins, you can download the application FREE from the link below.
December 2004: Government Rescinds Emergency Meal Regulation Changes
December 2004: Major Changes in Meal / Rest Break Regulations
August 2004: California’s Infamous “Bounty Hunter” Law Reformed
June 2002: Workers' Comp. Relief for Employers
April 2002: Supreme Court Favors Employers in FMLA Ruling
April 2002: Salary Basis Issue Finally Resolved
November 2001: New California Legislation (update)
November 2001: (2 Court Cases) What is Harassment?
October 2001: New Drug & Alcohol Testing Rules
October 2001: Tax Legislation: New Pension Laws
October 2001: Employers Must Explain Family Leave
March 2001: Rest and Meal Periods II
March 2001: Salary Basis Test Changes to Monthly
January 2001: AB 2509 (Wage & Hour Law)
December 2000: Rest and Meal Periods
Dec. 2000: New Calif. IWC Wage Order 16
Dec. 2000: New OSHA Ergonomics Standards
Nov. 2000: New Workplace Investigations Course
November 2000: Calif. Minimum Wage Increase
March 2000: AB60 Update
August 1999: Sick Pay Law
August 1999: Cal Poly Class and GMS
August 1999: Age Discrimination Law
November 1998: Susan Waag CCPA
November 1998: FEHA Liability Reduction
November 1998: Disability Discrimination
November 1998: COBRA
November 1998: CHP Drug Testing
July 1998: Sexual Harassment


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