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Legislative Update

California Employment Law Updates

Pending his imminent departure from office, Governor Jerry Brown signed into law several bills that will make significant changes to the California employment landscape. Many of the employment bills reaching the governor’s desk were drafted in response to the “#MeToo” movement. The legislation is designed to further protect workers from sexual harassment and retaliation, and expand workers’ rights to speak publicly about their experiences.

This legislative session was not all about sexual harassment, however. The governor signed dozens of bills which will impact public and private employers in California and specific industries. These changes will require employers to make changes to their existing policies, and update training materials, settlement and severance agreements, and general workplace practices. The following is a summary of some of the major bills with the most sweeping implications.

SB 1300 – Changes to FEHA Provisions on Sexual and Other Forms of Harassment:

  • Limits Confidentiality Agreements: This bill prohibits employers, in exchange for a raise or bonus, or as a condition of employment, from requiring the execution of a release of a claim or right under FEHA or requiring an employee to sign a non-disparagement agreement or other document that purports to deny the employee the right to disclose information about unlawful acts in the workplace. Note, however, that there is an express exception for negotiated settlement agreements. The statute is also written to apply only to current employees or applicants, not former or terminated employees.

  • Expands Existing Liability: Previously, FEHA protected non-employees from sexual harassment. This bill expands those protections to include harassment on the basis of any characteristic protected by FEHA.

  • Employer Recovery of Fees and Costs in FEHA Cases: Employers can no longer recover attorneys’ fees, expert fees, or costs of suit when they prevail in a FEHA case unless the court finds the action was frivolous, unreasonable, or groundless when brought, or the plaintiff continued to litigate after it clearly became so. This will hinder efforts at early resolution in such cases.

  • Disapproval of Summary Judgment in Harassment Cases: The new statute modifies the minimum showing necessary for employees to overcome summary judgment on harassment claims, which will result in more harassment claims going to trial.

SB 820 – Ban On Confidentiality Agreements: This bill bans confidentiality provisions in sexual harassment settlement agreements. Employers can still prevent disclosure of the amount paid to the plaintiff in the settlement, but the facts and circumstances of the alleged harassment cannot be subject to nondisclosure, even if the parties stipulate to the nondisclosure of those facts. The inclusion of any such provision is void, unenforceable and against public policy.

SB 3109 – Right to Testify Regarding Sexual Harassment: This bill makes unenforceable any provision in a settlement agreement that waives a party’s right to testify about sexual harassment or criminal conduct in an administrative, legislative, or judicial proceeding.

AB 2770 – Privileged Communications Regarding Sexual Harassment: Under the common-interest privilege set forth in Civil Code section 43(c), certain information provided during employment reference checks cannot form the basis of a defamation claim by the former employee, so long as the communication involves truthful information about the former employee made without malice. This bill specifically adds truthful information about sexual harassment by the employee to the category of privileged communications. This bill was primarily intended to protect employees who complain to their employers about being the victim sexual harassment from defamation suits brought by the alleged harasser. The bill adds little to protect employers against defamation suits and employers are still advised to consult with counsel if information beyond “name, rank, and serial number” is contemplated.

SB 1343 – Sexual Harassment Training: By January 1, 2020, any employer with 5 or more employees must provide at least 2 hours of sexual harassment training to all of its employees. Employers must provide employees with sexual harassment training once every 2 years after that. The Department of Fair Employment and Housing is required to create a training video and make it available for streaming online.

AB 1976 – Lactation Accommodations: This bill provides more specificity with respect to the requirements for providing a room for lactation. “An employer who makes a temporary lactation location available to an employee shall be deemed to be in compliance with this section if all of the following conditions are met: (1) The employer is unable to provide a permanent lactation location because of operational, financial, or space limitations. (2) The temporary lactation location is private and free from intrusion while an employee expresses milk. (3) The temporary lactation location is used only for lactation purposes while an employee expresses milk. (4) The temporary lactation location otherwise meets the requirements of state law concerning lactation accommodation.” An agricultural employer, as defined in Section 1140.4, shall be deemed to be in compliance with this section if the agricultural employer provides an employee wanting to express milk with a private, enclosed, and shaded space, including, but not limited to, an air-conditioned cab of a truck or tractor.

AB 2282 – Salary History Information: There are existing requirements regarding salary history information with respect to job applicants, including the requirement to provide a “pay scale” upon “reasonable request” from an “applicant.” This bill defines those terms, which is useful for employers. The bill also adds clarity to the California Fair Pay Act by authorizing an employer to make a compensation decision based on an employee’s current salary as long as any wage differential resulting from that compensation decision is justified by one or more specified factors, including a seniority system or a merit system.

SB 826 – Corporate Boards of Directors: This bill requires, no later than the close of the 2019 calendar year, that a publicly held “domestic general corporation” or “foreign corporation” whose principal executive offices are located in California must have a minimum of one female on its board of directors.

AB 2587 – Paid Family Leave: This bill changed certain aspects of Paid Family Leave and disability compensation waiting periods. Employers should consult with counsel to review and update their policies and handbooks.

AB 2334 – Paid Family Leave: This bill expands Paid Family Leave to military service of covered family members. Employers will need to review update existing policies and handbooks.

AB 1565 – Direct Liability for Contractors: This bill affects construction contractors, who can be liable for wage claims by workers hired by subcontractors. The bill allows the general contractor to withhold disputed payments if there is an agreement on required documentation from the subcontractor itemized in the contract. Construction contractors should consult with counsel regarding the ways in which their contracts may be modified to reflect these changes.

AB 1654 – PAGA Exemption For Unionized Construction Workers: Unionized laborers in the construction occupations are no longer covered by California’s Private Attorneys’ General Act, which allows workers to collect specified civil penalties on behalf of themselves and others for violations of the California Labor Code.

AB 2334 – OSHA Reporting: This bill adopts Federal OSHA rules regarding electronic submission of workplace injuries and illnesses. Employers should ensure electronic submission practices are up to date.

SB 970 – Human Trafficking Awareness: This bill requires hotel and motel employers to provide human trafficking awareness training.

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