The New Year brings a number of new, significant employment laws for California businesses. These rules range in topic from worker classification to privacy. Employers need to consider these developments, understand how the laws affect operations, and adjust their policies and practices to ensure compliance. Worker Classification One of the biggest, most attention-grabbing changes coming to the workplace in 2020 is AB 5, the new law that clarifies the test used to determine whether a worker is an independent contractor or a normal W2 employee. AB 5 incorporates the “Dynamex ABC Test” into various parts of California’s labor statutes. From... READ MORE

Under the Healthy Workplaces, Healthy Families Act, employees in California who work for an employer for at least 30 days within a year (tracked from the beginning of their employment, rather than by calendar year) must be provided paid sick leave. This includes full-time, part-time, and temporary employees. Regulations like this can be confusing. Though the Healthy Workplaces, Healthy Families Act sets out specific paid sick leave requirements, the exact amount that you as an employer may owe to any individual employee can depend on a number of factors. One of these factors is which way you decide to calculate... READ MORE

By Jacqueline Schock Each state handles pregnancy and parental leave protections differently, and California has among the most robust collections of these laws. Some well-known federal laws (such as the Family Medical Leave Act) and state laws (such as the California Family Rights Act) set out requirements for larger employers in relation to their pregnant employees and their employees with families. Though these more well-known laws generally apply only to larger employers, there is some pregnancy and parental leave legislation that applies to small employers as well. As this post discusses, two of the most common forms of parental leave... READ MORE

Whether you’re opening a new business in its first location, moving, or expanding, you’ve probably put a lot of thought into the location, building, and unit you’ve chosen. Before you receive a business lease to review, you’ve probably toured many options and spent a lot of time negotiating with the property owner. While you may be tempted to think you’ve already negotiated all the important details and that you can proceed with executing the document, it’s important to take time to carefully review the lease with an experienced real estate attorney, who can help negotiate the lease terms which can... READ MORE

Setting up a nonprofit corporation in California is a complex process that involves the intersection of federal and state laws. If you want to set up a nonprofit, it’s important to familiarize yourself with the process and to work with your business attorney to ensure that no detail slips through the cracks. The specific type of nonprofit that most people think of when they hear the word “nonprofit” is called a “public benefit nonprofit corporation,” formed under the IRS’s 501(c)(3) tax exemption. To take advantage of this exemption, you first need to form an entity in California. After successfully completing... READ MORE

As a business owner, there are many steps you will need to take when hiring employees including finding a payroll system that works for your business, drafting an employee handbook outlining your business’ policies and procedures, and purchasing workers compensation insurance. Some of these steps, like purchasing workers compensation insurance, may seem insignificant or something that can be put off but they are critical to avoiding government fines, costly audits, and being left with a financial burden if an employee is injured on the job. To help you better understand what your workers compensation policy means for your business, we’ve... READ MORE

Those involved in business leadership—such as owners, directors, and LLC managers—owe a particular level of responsibility and care to their business. This level of responsibility takes the form of a number of particular duties, often referred to as “fiduciary duties.” You may have heard your lawyer talk about these duties, which include things like the duty of care, the duty of loyalty, and the duty of good faith. These duties all work together to ensure that business leadership makes decisions and operates the business in a way that is in the business’s best interest.  This post will focus in on... READ MORE

Just like in any other sector, highly-educated professionals often find themselves wanting to set up a business entity to better allow them to protect themselves, serve their clients, and to share support services with other similar professionals. When these sorts of professionals want to start a business in the state of California, they are required to use a type of business entity called a “professional corporation.” When Should I Form a Professional Corporation? As discussed above, licensed professionals will need to set up a professional corporation, rather than an LLC or a traditional corporation. As a general rule, if you’re... READ MORE

An injunction is an order granted by the court that requires the parties to not do a particular thing. Business contracts often refer to “injunctive relief” (or obtaining an injunction from a court to stop someone from doing something) or the related “specific performance” (requiring someone to do the specific things they agreed to do in a contract) as an option when economic damages are not sufficient to cover a problem. Examples of such situations include prohibiting contractors from sharing information they were given under a non-disclosure agreement and forcing a seller of a unique good to actually deliver the... READ MORE

Many business owners choose to protect their business by forming a separate entity, such as a limited liability company (also known as an “LLC”). Often, forming an LLC for your business can hit the “sweet spot” of compliance concerns. This is because an LLC gives your business benefits like a formal structure, its own tax number, and some limited separation from yourself, while also avoiding many of the corporate formalities that are required with traditional corporations. Many business owners take this lack of corporate formality to mean that their LLC has no recordkeeping requirements whatsoever. Unfortunately, this is simply not... READ MORE