At the present time, an estimated 7 million employees in California are not offered tax-qualified retirement plans through their employers. Starting Jan. 1, 2017, this is going to change. Under the California Secure Choice Retirement Savings Program (Senate Bill 1234), employers who do not currently offer a tax-qualified retirement plan to employees will be required to offer the new California state-run retirement program to their employees. According to California Treasurer’s Office, this new law is the “most ambitious push to expand retirement security since the passage of Social Security in the 1930s”.
Perhaps in response to some of the questions posed by the media following the election of Donald Trump, the Equal Employment Opportunity Commission (“EEOC”) recently released guidance on national origin discrimination under Title VII of the Civil Rights Act of 1964 (Title VII). As many employers are aware, Title VII applies to any individual employed in the United States by a covered employer (employer with more than four employees), regardless of immigration status, as well as any foreign national outside the United States when they apply for U.S.-based employment.
The results are in and we’re taking a look ahead at the potential changes in laws and policies that could impact employers in President-Elect Trump’s new administration. Particularly, we will be closely monitoring:
The use of medical marijuana in the California workplace has been a popular, if not confusing, topic as of late. With conflicting views on medical marijuana usage at the federal and state levels, many employers are understandably perplexed, if not a little nervous, while attempting to walk the fine line between federal law (which continues to recognize marijuana as an illegal substance) and contrary state laws (permitting marijuana both for medical and recreational use).
Perhaps a recent case out of a federal court in California will help shed some light on the matter. The case involves an employee who had worked at Kohl’s Department Stores for five years when he was diagnosed with anxiety and given a prescription for medical marijuana. He did not inform his employer of his drug use.
Many California employers are aware that there are limits on the types of questions you can ask job applicants and/or current employees who are interviewing for a new position. For example, it is unlawful to ask a question that could reflect bias based on race, color, age, gender, religion, gender affiliation, or any other protected status. This means an interviewee cannot be questioned about their religious beliefs, marital status, plans for a family, or sexual orientation. Furthermore, hiring decisions cannot be based on stereotypes or assumptions about a person’s protected status. While this may seem hard to prove, plenty of lawsuits by disgruntled applicants / employees have been brought against employers on this very premise. As a business owner in California, it is crucial that every one of your employees who are involved in the hiring process is aware of these boundaries before any interview takes place.
What does the EEOC have to say about interview questions? The EEOC’s Prohibited Employment Policies/Practices guidelines clearly state that “[a]s a general rule, the information obtained and requested through the pre-employment process should be limited to those essential for determining if a person is qualified for the job; whereas, information regarding race, sex, national origin, age, and religion are irrelevant in such determinations.”
What exactly does this mean? Let’s look to a recent court decision for guidance…
As many California employers know all too well, wage and hour class actions are on the rise. A quick Google search of any combination of the words “California”, “wage and hour” and “class actions” results in thousands of results, a number of them actual cases involving disgruntled employees seeking millions of dollars from their employers. Indeed, court reports reveal that these cases are filed weekly, if not daily, and that substantial amounts of money are at stake.
The Ninth Circuit recently found unenforceable a class (or “collective”) action waiver requiring employees to arbitrate their claims individually. In other words, requiring class action waivers as a condition of hire or continued employment violates the National Labor Relations Act (NLRA). The NLRA applies to both unionized and many private, non-unionized workforces and protects covered employees’ rights to engage in concerted activity for the purpose of mutual aid or protection.
The facts of the case, Morris v. Ernst & Young, are as follows: An employee filed a class action in federal court claiming that Ernst & Young misclassified employees to avoid paying overtime. Another employee proceeded to join the case. This was despite agreements signed by the employees stating that the employees must pursue any and all claims against their employer in individual (and not class or collective) arbitration proceedings. The federal district court ordered the two employees’ claims to individual arbitration, and the employees appealed.
California has been home to many a class action lawsuit surrounding meal and rest breaks, both before and after the state Supreme Court’s crucial 2012 decision in Brinker Restaurant Corp. v. Superior Court. Consequently, California employers have a sharp interest in making their break policies and practices as compliant as possible.
The Basic Rest Break Rule
What does California law have to say about when employees need to take rest breaks? First, CA Labor Code (Section 226.7) states that employers cannot require employees to work during breaks mandated by an order of the Industrial Welfare Commission. Second, the IWC has required (Section 12(A) of the Wage Orders) that:
In a win for employers throughout California and across the country, a recent court decision shows that an “honest belief” continues to be an effective defense for employers responding to employment discrimination claims. In an employment law context, the “honest belief” rule focuses on what a decision-maker honestly believed the facts to be and whether that belief provides a legitimate, non-discriminatory reason for an employment decision and not on the accuracy of the underlying facts asserted by an employer.
A trade secret is a formula, practice, process, design, instrument, pattern, commercial method, or compilation of information that is not generally known or reasonably ascertainable by others, and by which a business can obtain an economic advantage over competitors. Many businesses survive on their ability to keep their trade secrets, well, secret. For this reason, ensuring that confidential information stays within the company is crucial, and protecting trade secrets from employee theft needs to be a high priority. To ensure the safekeeping of confidential information, employers need to reiterate employee obligations regularly, including during onboarding and exit interviews, and have a plan of action for responding to insider breaches of trust.