2021 Employment Legislation Update

10.20.2021

The 2021 California Legislative Season has officially come to a close. But not without the passage of many new bills, some of which directly affect California employers. This article recaps the 2021 employment bills that could impact California employers moving forward. Unless otherwise noted, these bills will take effect on January 1, 2022.

AB 654 (COVID-19 Exposure Reporting)

AB 654 builds on and clarifies AB 685, which was passed in 2020. As you may recall, AB 685 set forth expansive COVID-19 exposure guidelines and reporting requirements. AB 654 seeks to clarify some of the employer reporting requirements under AB 685. Important amendments include:

Adjusts the Cal/OSHA exposure reporting time frame articulated by AB 685 from 48 hours to 48 hours or one business day, whichever is later.
Adds renewable natural gas to the list of critical governmental functions which cannot be materially interrupted by Cal/OSHA.
Clarifies that Cal/OSHA’s COVID-19 exposure requirements do not apply to health care facilities.

These new amendments go into effect immediately and will remain in effect along with the reporting requirements until January 1, 2023.

AB 701 (Warehouse Quota Requirements)

AB 701 targets warehouse distribution centers and the quotas placed on employees by warehouse employers therein. Specifically, AB 701 seeks to address the rise in on-site injuries allegedly caused by employee quotas. AB 701 applies to employers who directly or indirectly, or through an agent or any other person (including through the services of a third-party employer, temporary service, staffing agency or similar entity) employs or exercises control over the wages, hours, or working conditions of 100 or more employees at a single warehouse distribution center or 1,000 or more employees at one or more warehouse distribution centers in California. Important aspects of AB 701 include:

Requiring specified employers to provide to each nonexempt employee who works at a warehouse distribution center, upon hire (or within 30 days of the effective date of these provisions), with a written description of each quota to which the employee is subject, including the quantified number of tasks to be performed, or materials to be produced or handled, within the defined time period, and any potential adverse employment action that could result from failure to meet the quota.
Prohibiting workplace quotas that prevent compliance with meal or rest periods, use of bathroom facilities, or occupational health and safety laws.
Providing employees the ability to request a written description of each quota to which the employee is subject and a copy of the most recent 90 days of the employee’s own personal work speed data.
Prohibiting employers from taking adverse action against an employee for failing to meet a quota that has not been disclosed or that violates AB 701.
Creation of a rebuttable presumption of unlawful retaliation if an employer takes any adverse action against an employee within 90 days of the employee requesting information or complaining about a quota.

AB 701 authorizes current or former employees to bring an action for injunctive relief to obtain compliance with these requirements and, where successful, allows for the recovery of costs and reasonable attorneys’ fees. AB 701 also authorizes several new enforcement mechanisms for several divisions within the Department of Industrial Relations, including the Division of Occupational Safety and Health and the Division of Workers’ Compensation.

AB 1003 (Wage Theft)

AB 1003 establishes that intentional theft of wages by employers is punishable as grand theft. Specifically, AB 1003 makes an employer’s intentional theft of wages, gratuities, or benefits in an amount greater than $950 for one employee or $2,350 for two or more employees, in any 12 consecutive month period, punishable as grand theft. AB 1003 defines grand theft as the “intentional deprivation of wages, gratuities, benefits, or other compensation, by unlawful means, with the knowledge that the wages, gratuities, benefits, or other compensation is due to the employee under the law.” AB 1003 applies to California employers of all sizes, and covers independent contractors as well as employees.

AB 1033 (California Family Rights Act (“CFRA”) Amendments)

AB 1033 expands CFRA to include employee leave to care for parents-in-law. AB 1033 also makes several procedural modifications to the Department of Fair Employment and Housing’s (“DFEH”) mediation pilot program—which only applies to employers that employed between 5 and 19 employees at the time any alleged violation occurred.

SB 62 (Joint Liability in Garment Industry)

SB 62 expands joint and several liability for employers in the garment manufacturing supply chain with respect to wage and hour violations. Specifically, SB 62 will make manufacturers and/or retailers within the garment manufacturing supply chain liable for wage and hour violations of their contactors (and potentially subcontractors) up and down the supply chain even if the manufacturers are unaware of the violations. SB 62 also prohibits piece-rate compensation within the garment manufacturing industry.

SB 331 (Silenced No More Act)

SB 331, known as the Silenced No More Act, makes it unlawful for an employer or former employer to include in any agreement any provision that prohibits the disclosure of information about unlawful acts in the workplace related to an employee’s separation from employment with the employer. Specifically, SB 331 prohibits the use of non-disclosure agreements to settle workplace-related legal claims involving unlawful harassment, discrimination, retaliation, or any other conduct that the employee has reasonable cause to believe is unlawful, except for limited circumstances.

SB 331 also prohibits non-disparagement agreements or similar agreements required as a condition of employment (or continued employment) that deny an employee’s right to disclose information about unlawful acts in the workplace, unless the agreement includes language providing for the employee’s right to discuss such unlawful workplace conduct.

SB 606 (Cal/OSHA Enforcement Expansion)

SB 606 extends potential penalties for employers by providing expanded scope of enforcement for Cal/OSHA. Specifically, SB 606 makes vast changes to Cal/OSHA by creating two new categories of violations: (1) enterprise-wide, and (2) egregious.

“Enterprise-wide” violations could greatly impact employers with multiple worksites, and provides liability to employers if:

The employer has a written policy or procedure that violates section 25910 of the Health and Safety Code, any standard, rule, order or regulation; OR
Cal/OSHA has evidence of a pattern or practice of the same violation or multiple violations committed by that employer at more than one of the employer’s worksites.

As for “egregious” violations, Cal/OSHA can find that an employer has committed such a violation if:

The employer, intentionally, through conscious, voluntary action or inaction, made no reasonable effort to eliminate the known violation;
The violations resulted in worker fatalities, a worksite catastrophe, or a large number of injuries or illnesses. For purposes of this law, “catastrophe” means inpatient hospitalization, regardless of duration, of three or more employees resulting from an injury, illness, or exposure caused by a workplace hazard or condition;
The violations resulted in persistently high rates of worker injuries or illnesses;
The employer has an extensive history of prior violations;
The employer has intentionally disregarded its health and safety responsibilities;
The employer’s conduct, taken as a whole, amounts to clear bad faith in the performance of its duties; OR
The employer has committed a large number of violations so as to undermine significantly the effectiveness of any safety and health program that may be in place.

The conduct underlying a violation determined to be “egregious” will remain in effect for five years. After that five-year period has elapsed, additional evidence will be required to support any subsequent citation for an egregious violation.

Lastly, SB 606 provides Cal/OSHA with the authority to “issue a subpoena if the employer or related entity fails to promptly provide the requested information.”

SB 646 (Private Attorneys General Act of 2004 (“PAGA”) Exemptions for Unionized Janitorial Employees)

SB 646 creates an exemption from PAGA for janitorial employees who are covered by a collective bargaining agreement (“CBA”) that meets certain criteria. In particular, the CBA must provide for the wages, hours of work, working conditions of employees, and provide premium wage rates for all overtime hours worked—among other conditions. SB 646 defines “janitorial employee” as an employee whose primary duties are to clean and keep in an orderly condition commercial working areas and washrooms, or the premises of an office, multiunit residential facility, industrial facility, health care facility, amusement park, convention center, stadium, racetrack, arena, or retail establishment.

SB 657 (Electronic Document Transmission)

SB 657 gives employers the right to distribute information to employees by email in any instance in which an employer is required to physically post the information, such as workplace postings. However, SB 657 does not alter the employer’s obligation to physically display any required postings.

SB 807 (Procedural Amendments to the Fair Employment and Housing Act (“FEHA”))

SB 807 makes procedural changes to how the DFEH enforces California’s civil rights and anti-discrimination laws under the FEHA. Specifically, SB 807 extends an employer’s record retention requirements for employees and applicants from two (2) years to four (4) years from the date the records were created, or the date the employment action was taken. SB 807 also amends several other procedural deadlines including:

Extending the period for which an individual can file a complaint alleging violations of several statutes by tolling the time period to file while the DFEH investigates.
Extending the period the DFEH has to issue a right-to-sue letter to two (2) years for class-wide employment claims.
Modifying and granting the DFEH specified enforcement powers, including the power to petition the superior courts to compel compliance with investigations of the DFEH pursuant to certain employment or housing discrimination complaints.
Tolling the deadline for the DFEH to file a civil action pursuant to the FEHA while a mandatory or voluntary dispute resolution is pending.

The Governor also vetoed a couple of the bills that we were tracking this summer.

AB 123 (SDI and PFL programs)

AB 123 sought to greatly increase PFL payments from 60-70% of the employee’s highest quarterly earnings to 90%. AB 123 also sought to increase SDI payments. However, AB 123 was vetoed by the Governor on September 28, 2021, on the basis that “this bill would create significant new costs not included in the 2021 Budget Act and would result in higher disability contributions paid by employees.”

AB 1074 (Displaced Janitor Opportunity Act)

AB 1074 sought to establish the Displaced Janitor Opportunity Act, and would have required “contractors” and “subcontractors” who provide janitorial or building maintenance services at a particular jobsite or sites, to retain, for a period of 60 days, certain employees who were employed at that site by the previous contractor or subcontractor. Essentially, AB 1074 would have provided employees of these employers a statutory right to employment recall. However, the Governor vetoed AB 1074 on September 28, 2021.

Employers with questions on any of the above bills may ask the authors or their usual employment law counsel at AALRR.