2019 California Labor and Employment Legislative Update Erika Frank Executive Vice President, Legal Affairs General Counsel California Chamber of Commerce

Political Environment Super-majority of Democrats in both Assembly and Senate. Most labor and employment bills only require a majority vote, which means it is much easier for proponents to meet the vote threshold. First year of Governor Newsom’s administration – his position is unknown.

Family Leave Benefits Governor Newsom has made this a priority in his budget. Expands existing Paid Family Leave (PFL) program by two weeks. Note: wage replacement not leave. Ultimate goal = Ensure parents of a new child can stay home for a combined 6 months with job protection.

California’s Existing Family Leave Rights Pregnancy Disability Leave – 5 employees or more. California Family Rights Act/Federal Family Medical Leave Act - 50 employees or more. New Parent Leave Act – 20-49 employees. Employee must be eligible: Work for 12 months Work for 1250 hours Work at a workplace with 50/20 employees within a 75 mile radius.

Family Care and Medical Leave Expansion – SB 135 Authored by Senator Jackson Expands California Family Rights Act to employers with 5 or more employees. Expands definition of “family members" to include child in-law, grandparent, grandchild, sibling, or designated person. "Designated Person" - identified by the employee at the time the request for leave is made Changes threshold for employee eligibility from 12 months and 1,250 hours worked to only 180 days.

Dynamex and Independent Contractors 2018 California Supreme Court Decision. New “ABC Test” – burden on employer to prove. Applicable to Wage Order claims. Retroactive Application. 9th Circuit case in Vazquez v. Jan-Pro Franchising confirms.

Dynamex and Independent Contractors AB 5 (Gonzalez) Codifies “ABC” test for Wage Orders, Labor Code and Unemployment Insurance Code. Exempts: Insurance agents, stock brokers, doctors, direct sellers, realtors, hair stylists/barbers. Broad professional exemption – lawyers, accountants, engineers, architects.

Dynamex and Independent Contractors, Cont. AB 5 - More Exemptions in the works: Business to business exemption Occupational licensed workers What about the Trucking Industry and Gig Economy? Unknown for now.

Sexual Harassment AB 628 (Bonta) Creates a protected, unlimited leave of absence for victims of harassment and family members of victims of harassment. Proposes a definition of harassment in Labor Code (failed last year). AB 9 (Reyes) Expands statute of limitations for claims under the Fair Employment and Housing Act (FEHA), which includes harassment, from one year to three years (vetoed last year). AB 170 (Gonzalez) Expands liability for harassment claims between two companies (vetoed last year). AB 171 (Gonzalez) Creates a rebuttable presumption of retaliation/discrimination for any victim of harassment that is subject to an adverse employment action within 90 days of notice of the harassment (vetoed last year)

Arbitration AB 51 (Gonzalez) Prohibits arbitration agreements that are signed as a condition of employment for the resolution of any claim under the Labor Code or FEHA. Labor Union and Trial Attorney sponsored/supported. AB 3080/AB 465 Prior measures that were similar to AB 51 and vetoed by Governor Brown. Federal Preemption - Supreme Court decisions continue to strengthen preemption for any state claims or decisions that interfere with right to arbitration (Epic Systems, Lamps Plus Inc.)

Other Labor Bills of Interest AB 555 (Gonzalez) Seeks to expand paid sick days from 3 to 5 days, without addressing current problems with existing paid sick leave (documentation, rate of pay, local preemption). AB 1066 (Gonzalez) Allows employees on strike for more than four weeks to receive unemployment insurance benefit. AB 749 (Stone) Prohibits “no re-hire” clauses in any settlement agreement. SB 142 (Wiener) Mirrors the San Francisco Lactation in the Workplace Ordinance and requires a dedicated lactation space with a sink nearby (cannot be a bathroom) and expands civil liability. SB 778 (Committee bill) Clarifies existing employee and supervisor sexual harassment training requirements.

Regulatory Activity Fair Employment and Housing Act Harassment regulations Religious accommodation regulations Age discrimination regulations Cal/OSHA Indoor Heat Illness Regulations Smoke/Wildfires Division of Labor Standards Enforcement Application of Joint Employer Liability/apportionment California Secure Choice Retirement Savings Investment Board Implementing the CalSavers Retirement Savings Program

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