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2017 EMPLOYMENT LAW
UPDATE
Daniel J. Muller
Ventura Rossi Hersey & Muller, LLP
160 W. Santa Clara Street, Suite 1575
San Jose CA 95113
[email protected]
408-512-3025
NEW LEGISLATION - SMOKING
 AB X2-7: Expands Prohibition of Smoking in the
Workplace
 Eliminates “size of employer” exemptions
 Eliminates exemptions for hotel lobbies, bars, taverns,
gaming clubs, and warehouse facilities
 Eliminates “designated smoker rooms”
 Smoking prohibition specifically covers e-cigarettes and
vaping devices
NEW LEGISLATION - PROPOSITION 64
 Marijuana Legalization - Allows private use immediately; allows
for sale of marijuana beginning in 2018.
 Nothing in the law changes or restricts “[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 marijuana in the workplace, or
affect the ability of employers to have policies prohibiting the use
of marijuana by employees and prospective employees, or prevent
employers from complying with state or federal law.”
NEW LEGISLATION - BAN THE BOX
 California Labor Code 432.7 prohibits most employers
from requiring applicants to disclose arrests or
detentions that do not result in a conviction and from
using any such information in employment decisions.
 AB 1843 expands those prohibitions to include
information relating to juvenile arrests and detentions.
NEW LEGISLATION - DOMESTIC VIOLENCE
 AB 2337 requires employers to notify employees about
existing laws protecting victims of domestic violence, sexual
assault, or stalking from discrimination and retaliation
because they take time off work to address such issues.
 The new law requires the DLSE to develop an optional form
to provide the requisite notice.
 Compliance is necessary once the DLSE form is available.
NEW LEGISLATION - FEHA
 The California Fair Employment & Housing Act (FEHA)
has been amended to:
 Protect disabled individuals previously exempt from the
law.
 Specifically, the amendments apply to people licensed to
work at nonprofit workshops, day programs, and
rehabilitation facilities for less than minimum wage.
NEW LEGISLATION - WAGE STATEMENTS
 AB 2535 expands an existing exception regarding the
reporting of hours worked on wage statements.
 AB 2535 confirms that Employers do not need to report
hours worked for exempt employees and outside
salespersons.
 Corrects the ruling in Garnett v. ADT LLC.
NEW LEGISLATION - EMPLOYMENT
CONTRACTS
 SB 1241 provides that employees in California have a right to void
“forum selection” clauses in any contract with an employer entered
into, modified, or extended after January 1, 2017.
 Specifically, a California employee has the right to void any
contractual provision that deprives the employee “of the
substantive protection of California law with respect to a
controversy arising in California.”
 Does not apply to the entire contract.
 Does not apply if the employee was individually represented when
the contract was negotiated.
NEW LEGISLATION - CELL PHONES
 AB 1785 prohibits driving while holding and operating a
handheld wireless telephone or a wireless electronic
communication device unless in “hands free mode.”
 The law creates an exception for making a single swipe or
tap while the device is mounted on the windshield or
dashboard/center panel of the vehicle.
 Consider modifying cell phone use policies for employees
who drive on behalf of the employer.
NEW LEGISLATION - MISCELLANEOUS
 AB 908 increases Paid Family Leave benefits and State
Disability benefits and eliminates the 7 day waiting
period. Effective in 2018.
 AB 2899 expands bonding requirement for Labor
Commissioner appeals.
 SB 1001 expands prohibitions regarding “unfair
immigration-related practices”
NEW DOL OVERTIME EXEMPTION
REGULATIONS
 The Department of Labor issued new regulations that became
effective on December 1 which provide that, in order to be exempt
under federal law, an employee must earn a salary of no less than
$47,476 per year. The regulations provide for ongoing upward
adjustments of the minimum salary.
 A federal court in Texas enjoined the regulations on November 22,
2016.
 Stay tuned. If the injunction is lifted, all employers need to review
the salaries of exempt employees to ensure that they remain
exempt.
COURT DECISIONS – DISABILITY
DISCRIMINATION
Castro-Ramirez v. Dependable Highway Express, Inc.:
 This case addresses the topic of “associational disability
discrimination.”
 Court ruled that the FEHA creates a duty on the part of the employer
“to provide reasonable accommodations to an applicant or employee
who is associated with a disabled person,” not just applicants or
employees who are themselves disabled.
COURT DECISIONS – DISABILITY
DISCRIMINATION
Soria v. Univision Radio Los Angeles:
 Former employee allowed to pursue disability claim even though she
never informed her employer in writing about her alleged disability.
 The Court ruled that there was a dispute of fact regarding whether
the employee had verbally reported her disability.
 Employer had an obligation to inquire further once employee made
the report about her disability.
COURT DECISIONS – WORKERS’
COMPENSATION EXCEPTION
Lee v. West Kern Water Dist.:
 Employee subjected to a “mock robbery” was not limited to a workers’
compensation claim as her exclusive remedy.
 The Court allowed her to sue her employer directly because her
injury was caused by a “willful physical assault.”
COURT DECISIONS – LEAVES OF ABSENCES
Mendoza v. The Roman Catholic Archbishop of Los Angeles:
 A fulltime bookkeeper took leave for 10 months.
 When she returned, her fulltime position had been reduced to parttime. She sued, claiming she was entitled to fulltime employment.
 The Court ruled in favor of the Employer because it showed that it
had legitimately reduced the position to part-time and that no
fulltime position was available.
COURT DECISIONS – WAGE AND HOUR
McLean v. State of California:
 Reiterates that final wages must be paid upon termination. This means
within 72 hours for a voluntary termination and immediately for an
involuntary termination.
 Retirement is not an exception.
Corbin v. Time Warner Entertainment:
 The 9th Circuit confirmed that employers may round timecards if the
rounding policy is “neutral, both facially and as applied.”
COURT DECISIONS – WAGE AND HOUR
Flores v. City of San Gabriel :
 The Court addressed the practice of providing cash payments to employees
who decline employer-provided health insurance.
 The employer in Flores considered the payments to be “benefits” and
did not include them when determining the regular rate of pay.
 The Court ruled that the payments must be included in the regular
rate of pay, which affects overtime compensation, vacation pay, and
sick pay compensation.
COURT DECISIONS – WAGE AND HOUR
Alvarado v. Dart Container Corp. of California:
 The Court of Appeal ruled that an employer need not exclude overtime
hours when calculating an employee’s regular rate of pay.
 The decision is consistent with federal law but inconsistent with the DLSE’s
rules. The DLSE requires that the regular rate of pay should be determined
by dividing total compensation by straight time worked. This results in a
higher regular rate of pay.
 The California Supreme Court has agreed to review the decision.
COURT DECISIONS – WAGE AND HOUR
USS-Posco Industries v. Case:
 Confirms that employers must pay employees for time spent in
mandatory training and must pay for the cost of the training.
 Allowed an employer to seek reimbursement from an employee for
the cost of a training program because (1) the training was voluntary
and (2) the employee agreed that, if his employment ended within 30
months of the employer agreeing to pay for the training, the
employer could seek reimbursement.
COURT DECISIONS – WAGE AND HOUR
Kilby v. CVS Pharmacy:
 Addresses the requirement that employers provide employees with “suitable seats
when the nature of the work reasonably permits the use of seats.” The Court
determined that:
 If the tasks performed at a given location reasonably permit sitting, and
provision of a seat would not interfere with performance of any other tasks that
may require standing, a seat must be provided
 Whether the nature of the work reasonably permits sitting is a question to be
determined objectively based on the totality of the circumstances.
 The inquiry focuses on the nature of the work, not an individual employee’s
characteristics.
COURT DECISIONS – DISABILITY
DISCRIMINATION
Augustus v. ABM Sec. Servs., Inc.:
 The Court affirmed a $90 million judgment because the employer
required “on duty” rest periods.
 The Court ruled that “What the law requires . . . Is that employers
relinquish any control over how employees spend their break time,
and relieve their employees of all duties—including the obligation
that an employee remain on call.”
LOCAL MINIMUM WAGES
Local Minimum Wage Ordinances:
 Mountain View:
$13 / hr
 Oakland:
$12.86 / hr
 Palo Alto:
$12 / hr
 San Jose:
$10.50 / hr becomes $12 / hr on 7/1/17
 San Francisco: $14 / hr
 Santa Clara:
$11.10 / hr
 Sunnyvale:
$13.00 / hr
DISABILITY LAW – THE INTERACTIVE
PROCESS
 Successful implementation of the “interactive process” is critical to avoiding and / or
resolving disability discrimination claims.
 The employee is entitled to the process even if the employer “knows” or suspects that no
reasonable accommodation is available.
 Documentation is key. Be sure to show that the employer is trying to find a solution.
 Ask this question if there is an actual or possible disability claim: “Is there anything we can
do so that you can perform the essential functions of your job?”
 Remember that an unpaid leave of absence can be a reasonable accommodation in some
circumstances.
MANAGING LEAVES OF ABSENCE
 Documentation is critical. Be able to show that notices were
given and appropriate leaves were offered.
 Know your own policies. If an employer is not careful, it can
create leave obligations when they otherwise would not exist.
 Train your supervisors. Leave laws are complicated.
Supervisors who “freelance” regarding leaves of absence can
create problems for employers.