About ten percent, or 1.9 million, of California's 19 million person workforce consists of independent contractors. Non-union workers reportedly earn 20% less than their union counterparts in the current gig economy. Classifying workers as independent contractors has severe consequences for such workers, as non-employees generally have no statutory right to minimum wage, overtime pay, compensation for on-the-job injuries, unemployment insurance for involuntarily leaving employment, or protection against other illegal employer activities like discrimination. In the winter of 2016, a California Assemblywoman, Lorena Gonzalez, introduced AB 1727 aka The California 1099 Self-Organizing Act, an amendment to California's Labor Code. Gonzalez' intention... READ MORE

California employers must be prepared to implement . Effective December 1, 2016, businesses that employ any employee earning an annual salary under $47,476 must re-assess and evaluate these new federal wage requirements affecting employee compensation. The FLSA's two-part compensation and duties test for exemption has not been changed by the new regulations. Instead, the minimum amount of salary required to qualify for the exemption has been revised. The final rule issued by the DOL increases the income threshold for employers to $913 a week, which is $47,476 annually. This new threshold is more than twice the current minimum salary. Under... READ MORE

The California Family Rights Act (CFRA) regulations, issued by the California Fair Employment and Housing Council, were amended as of July 1, 2015, and contain several noteworthy revisions. As a whole, the resulting provisions are in greater conformity with the federal Family and Medical Leave Act (FMLA). Both the CFRA regulations and FMLA apply to employers with 50 or more employees. The CFRA provides a new definition of “joint employer” which is substantially similar to that issued by the FMLA. The FMLA identifies a joint employer as two or more businesses asserting joint control over the employment of an employee... READ MORE

In 2014, California passed the Healthy Workplaces, Healthy Families Act of 2014 (the “Act”), which mandated the provision of paid sick leave for employees. On July 13, 2015, amendments to the Act (AB 304) took effect and were designed to clarify some of the ambiguities of the original legislation. The major modifications to the Act include the following: Amendments to rate of accrual. While the Act specified that paid sick leave should accrue at one hour per 30 hours worked, AB 304 gives employers flexibility to institute different accrual methods so long and the time is accrued on a regular... READ MORE

Non-disclosure and confidentiality agreements are routinely executed between employers and employees, particularly in emerging or highly competitive industries. The goal of the Non-Disclosure Agreement (NDA) is to ensure that employees or independent contractors who obtain proprietary knowledge during their relationship with the business do not use or disclose the information after the relationship has ceased. Similarly, in many states, a Non-Compete Agreement (NCA) restricts an employee from employment in the same field for a specified amount of time and within a certain distance from the former employer. In California, however, a 2008 Supreme Court decision found that NCAs are not... READ MORE

Most businesses are aware of the value of written employment agreements to establish the roles and responsibilities of employees and address the legal obligations of employees with respect to confidential information upon termination. Employee contracts are an important step in preventing employee-related disputes and should be reviewed periodically as employment relationships and employment conditions evolve. An equally important staple for both large and small businesses is creating and distributing employee handbooks. Although providing employee handbooks is not mandated by law in California, every business in California must have certain employee policies in writing. As such, it is generally accepted as... READ MORE

The California legislature has taken action to prevent abusive treatment of foreign laborers by California employers in a new law enacted in 2015. The California Foreign Labor Recruitment Law (SB 477) provides protections to foreign workers by restricting certain practices by foreign labor contractors, described as any person who solicits or recruits a foreign worker who resides outside the United States for paid work for employer’s business in California. This legislation is modeled after a previous bill, SB 516, which included employers that directly hired foreign laborers in its restrictions on exploitative employment practices. The current bill, which covers only... READ MORE

The California legislature enacted several new laws this past year affecting employees and independent contractors.  Under AB 1897, which went into effect on January 1, 2015, employers may become jointly liable with independent contractors it hires to provide labor for wage violations and workers compensation defaults of the independent contractor for services that are within the course of the employer’s business or performed at the employer’s work site. Accordingly, employers benefiting from labor services will share with the labor contractor all civil legal responsibility and civil liability for all workers supplied to the company. In the past, these rules applied only to... READ MORE