Labor and Employment Law

The California Legislature was quite busy in 2012 in the labor and employment arena, passing more than a dozen new laws affecting employers. California employers will need to take prompt action to ensure compliance, including revising employee handbooks, employment policies and practices.

The most significant of those new laws, which went into effect January 1, 2013, include the following:

1.Accommodation of religious dress and grooming practices.
2.Breastfeeding is given new protections.
3.Prohibition on requesting access to applicants or employees’ social media.
4.All commission agreements must be in writing.
5.Detailed new obligations and penalties regarding inspection and production of employee personnel and pay records.
6. New rules regarding compensation agreements for nonexempt employees.
7.Expansion of whistleblower protection under California’s False Claims Act.
8.Wage garnishment changes.

We will address the first four of these new laws in detail in this newsletter, and the remaining new laws in later editions.

Accommodation of Religious Dress and Grooming Practices

The Workplace Religious Freedom Act of 2012 expands already existing religious discrimination protections and reasonable accommodation requirements of California’s Fair Employment and Housing Act (“FEHA”), to cover religious dress practices and religious grooming practices.

Spurred by workplace discrimination against Sikhs, the new law mandates that the term “religious dress practice” is to be construed broadly, to include “the wearing or carrying of religious clothing, head or face coverings, jewelry, artifacts and any other item that is part of the observance by an individual of his or her religious creed.” The term “religious grooming practice” is also to be construed broadly, and includes “all forms of head, facial and body hair that are part of the observance by an individual of his or her religious creed.”

This new law requires employers to reasonably accommodate employees’ religious dress and grooming practices, unless the employer can show an “undue hardship,” which means the employer must demonstrate “significant difficulty or expense” when considered in light of a number of factors, including the nature and cost of the accommodation, the overall financial resources of the facility or entity, and the type of operations of the workforce. The law also prohibits any accommodation that requires segregation of the individual from other employees or the public.

Accordingly, employers should update their handbooks, policies and procedures to reflect these requirements. Given that the “undue hardship” standard may be difficult to meet, employers should exercise caution before denying any request for accommodation of religious dress or practices, particularly with respect to religious clothing, the length of an employee’s head hair, or facial hair. Employers who require employees to wear uniforms or particular clothing, or who prescribe standards of appearance for their employees should pay special attention to these new rules.

Discrimination on the Basis of Breastfeeding is Unlawful.

California law already defined “sex” to include gender, pregnancy, childbirth, and medical conditions related to pregnancy or childbirth, and California law already prohibited workplace discrimination based on these characteristics. However, in response to a case in which an employee was terminated because she was nursing her baby during her lunchtime break, the legislature passed an amendment to the FEHA to expand the term “sex” to include breastfeeding, and medical conditions related to breastfeeding. This makes it clear that discrimination on those bases is illegal.

Existing law also already provided that an employer must provide an adequate private space, and a reasonable amount of break time, to accommodate an employee who needs to express breast milk. The employee’s remedy for the employer’s noncompliance was an action for civil penalties. This new law allows an employee to sue the employer for damages for discrimination.

Employers should update their handbooks, policies, and procedures to reflect the new broadened scope of FEHA. Employers also should carefully review their policies and procedures relating to accommodations for expressing breast milk.

Restriction on Employer Requests for Access to Social Media.

We’ve always felt it was dangerous for an employer to ask applicants or employees for user names and passwords in order to gain access to their personal social media. This new law confirms our concerns, since it prohibits employers from requiring or requesting an employee or applicant for employment to (1) disclose a user name or account password to access a personal social media account, such as Facebook or Twitter, (2) access personal social media in the employer’s presence, or (3) divulge any personal social media. The new law also contains an anti-retaliation provision.

This legislation applies purely to the personal social media of the applicant or employee. It does not restrict an employer from requesting or requiring an employee to disclose a username, password, or other method of accessing an employer-issued electronic device. This new law also does not affect an employer’s ability to request that an employee divulge personal social media information reasonably believed to be relevant to an investigation of allegations of employee misconduct or employee violation of applicable laws and regulations, as long as the information about the social media is used solely for that or a related investigation or proceeding. However, employers should proceed with extreme caution in doing so, since such investigations often roam farther afield than they should.

Employers should review and update their social media policy. The policy should be broad enough to cover a broad range of social media platforms (including future platforms), but specific enough to provide employees with real guidance on permissible social media use. Employers’ social media policies should not be so restrictive as to “chill” their employees’ right to engage in concerted activities under the National Labor Relations Act, which applies to both union and nonunion employers. For example, the National Labor Relations Board has found an employer’s policy that prohibited “[m]aking disparaging comments about the company through any media” to be unlawful, because it contained no limiting language that would clarify to employees that the rule does not restrict their rights. Thus, a social media policy should be prepared by, or, at a minimum, reviewed by, employment counsel.

Commission Agreements Are Now Required to be in Writing.

Do you have any employees who are paid on a commission basis? If so, do you have a written contract setting forth the terms and conditions by which commissions will be earned and paid? Has the contract been signed by the employee, and has the employee been given a copy? If you haven’t done these things, you should. What was already a prudent business practice is now the law.

Commission arrangements have provided fertile ground for lawsuits, since they often are not in writing, leading to disputes about exactly what the deal was. Even when in writing, they often do not adequately define when a commission is earned and payable. This new law requires that commission plans be in writing, expressly set forth the method by which the commissions will be computed and paid, and be signed by employees, who are entitled to retain a copy of the written plan. The new law also requires employers to obtain a signed acknowledgment from employees that they received the written commission plan. While these new requirements are relatively straightforward, even written commission arrangements are often unclear, and susceptible to differing interpretations. Also, they can include illegal chargebacks, if not drafted carefully.

The nuances of drafting a commission agreement are often not appreciated by employers. A good commission agreement will include clear unambiguous provisions relating to a number of things, including the following: when a commission is earned; when a commission is payable; the impact separation of employment has on payment of commissions; how exactly the commission is calculated, etc. Accordingly, employers with commission arrangements are well advised to consult experienced employment counsel to ensure that their commission plans not only comply with the law, but are clear, and comprehensive. Otherwise, employers are playing with fire.