Will being unemployed soon be a protected class?

California, as well as the nation as a whole, in is the midst of very trying times.  Unemployment is high; qualified and experienced men and women everywhere are finding it hard to find work.  Some have been out of the workforce for so long, they are finding it difficult to get back in. 

State and federal legislators are taking action to combat this problem.  There is a movement by both California and the federal government to make being unemployed a new protected class.  And with a higher-than-normal percentage of potential voters out of work, politicians seeking re-election this year will surely attempt drum up support for this proposed legislation.

In California, legislation has been introduced to protect unemployed workers, and thus prohibit an employer from using a person’s unemployed status at the time of applying for a job as a negative criteria in the hiring process.  This bill, AB 1450, was introduced a few months ago in January.  Similar to the California bill, Congress has introduced HR 2501 in the House and S 1471; these two bills would provide similar protections to workers on a nationwide level.

Currently, most protected status complaints and lawsuits deal with harassment and termination of the employment relationship; lawsuits based on failure to hire are generally rare.  Yet if either of these bills are passed, employers can expect an uptick in litigation by unemployed applicants who apply for positions and are not hired, especially if those applicants appear to be otherwise qualified.  Employers would be wise to consider altering their hiring practices, and provide some additional training to those making the decision to hire new employees in order to avoid problems down the road.  And while these proposed bills are not yet the law, given the state of California and the country’s economic woes, and the fact that this is an election year, employers could very soon have another thing to worry about.  

Shades of Gray in Discrimination Law

Everyone knows discrimination in the workplace is illegal.  The prohibition of discrimination based on age, race, national origin, religion, sex, and disability are well known in California.  But not all discrimination is cut and dry – gray areas abound in this arena.  This article will explore four such situations.

Dress Standards
An employer is not discriminating when it requires reasonable dress and grooming standards of employees.  Of course appropriate business attire may generally be different for men and women when there is a clear, nondiscriminatory rationale.  For example, men may be required to cut their hair short, while women may be allowed to wear their hair longer.  However, it is illegal to prohibit women from wearing pants in the workplace (Government Code section 12947.5).  Employers must also accommodate an employee’s religious beliefs that affect his or her dress standards, physical appearance or grooming.

Tattoos and Piercings
California’s discrimination laws do not protect employees because of their tattoos and body piercings.  Employers are free to create policies prohibiting visible tattoos and piercings.  Moreover, these policies may differ as applied to men and women – i.e. employers can prohibit men from wearing earrings, while allowing women to do so.

Height and Weight Standards
Employers cannot establish height or weight standards which, in effect, discriminate against protected classes.  If an employer can show that  a weight or height restriction both relates directly to, and is an essential function of, the job, then selection of employees according to justifiable height and weight standards is not discriminatory.

English-only Policies
Employers are limited in their ability to adopt an “English-only policy.” If an employer has five or more employees (unless the employer is a non-profit religious association or religious corporation), an employer may not adopt or enforce a policy limiting or prohibiting the use of any language in the workplace unless (1) The language restriction is justified by a “business necessity”; and (2) The employer notifies the employees of the circumstances and time when the language restriction must be observed and of the consequences for violating it. 
What constitutes a business necessity?  A business necessity is a legitimate business purpose such that: (1) The language restriction is necessary for the safe and efficient operation of the business; (2) The language restriction effectively fulfills the business purpose it is supposed to serve; and (3) There is no alternative practice to the language restriction that would accomplish the business purpose equally well with a lesser discriminatory impact.

Conclusion
These are of course not the only gray areas in California discrimination law.  It is sometimes difficult to keep up with all the changing facets of discrimination law, and each fact pattern creates new challenges.  Yet these examples are instructive, and the basic tenets of each can applied across the broad spectrum of discrimination law issues.

Governor Brown sets a deadline for written commissions agreements

There are a myriad of ways in which employers can their employees.  Some employees earn their wages on an hourly basis; some receive a regular salary, while other are paid via commissions.  Oftentimes an employee’s pay is a hybrid of the above.  This article focuses on a new law dealing with employees who are paid via commissions. 

On October 7, 2011, Governor Brown signed AB 1396. This bill requires all California employers to draft written contracts for any agreements with employees that involve commissions as a method of payment for services. Commission wages are defined as compensation paid to any person for services rendered in the sale of an employer’s property or services and based proportionately upon the amount or value thereof.

The bill imposes a deadline of January 1, 2013 for employers to reduce all commission agreements to writing.   The bill also requires employers to provide a signed copy of the contract to every employee covered by the commission agreement and obtain a signed receipt for the contract from each employee. While the new law does not spell out any specific penalties for violation of the law, presumably an employee could bring a suit under California’s Unfair Competition Law in the event of a violation.

California already regulates the payment of commissions, the calculation of commissions and what happens with a commission upon termination/resignation.  There are also technical regulations on the books dealing with overtime compensation to commissions-based employees.  As such, not only must employers must draft written commission agreements by the January 1, 2013 deadline, they should also review the contents of these written agreements to ensure they are clear and comply with established California law.

The Only Constant is Change: New Workplace Regulations for 2012

California employment law is always changing.  And it looks like 2012 will be no exception.  Below are some proposed changes to the employment law landscape.  These new bills, signed by Governor Jerry Brown become effective January 1, 2012.  

Pregnancy Disability Leave (SB 299)

SB 299 prohibits employers from refusing to maintain and pay for group health insurance coverage for the duration of pregnancy disability leave, up to four months in a 12-month period.

The law also authorizes employers to recover insurance premiums from the employee if the employee fails to return from pregnancy disability leave, provided that the employee’s failure is not due to leave taken for a health condition, or other circumstances beyond the employee’s control.

Organ and Bone Marrow Donor Leave (SB 272)

Under existing law, an employer must grant a leave of absence of up to 30 days in a one-year period to an employee who is an organ donor and up to five days in a one-year period to an employee who is a bone marrow donor. SB 272 provides that the days of leave are business days, rather than calendar days, and that the one-year period is measured from the date the employee’s leave begins and consists of 12 consecutive months.

Credit Reports (AB 22)

AB 22 imposes significant restrictions on an employer’s ability to obtain a credit report for employment purposes. It generally permits employers that are seeking to fill only specific, identified exempt positions to obtain and use credit reports to screen applicants or current employees. The use of the credit reports in other occupations generally is prohibited.

Employer Contract Requirements (AB 1396)

AB 1396 requires an employer that enters into an employment contract involving commission payments for services to be rendered within California to put the contract in writing and specify the method by which the commissions are to be computed and paid. The employer must give a signed copy of the contract to every employee who is a party thereto and obtain a signed receipt for the contract from each employee. The law also repeals existing law making an employer that violates this requirement liable in a civil action for triple damages.

Genetic Information (SB 559)

SB 559 amends the California Fair Employment and Housing Act (FEHA) to prohibit discrimination on the basis of genetic information.

Gender Expression (AB 887)

AB 887 amends California FEHA to clarify that prohibited discrimination in employment and housing on the basis of sex or gender includes discrimination on the basis of a person’s gender identity and gender expression. The law defines gender expression as meaning a person’s gender-related appearance and behavior, whether or not stereotypically associated with the person’s assigned sex at birth.

While many of these provisions may not apply to your particular business, all employers would be wise to review these new laws in greater detail and update employee handbooks and personnel policies to ensure compliance with these new regulations. 

The Perils of Polygraph Tests

Employers may be tempted from time to time to ask or even require employees to submit to polygraph tests, often called lie detector tests.  Are such tests legal?  This article will explore the legal ramifications of polygraph tests in the workplace.

Federal law

The Employee Polygraph Protection Act of 1988 (EPPA) generally prevents employers from using lie detector tests, either for pre-employment screening or during the course of employment.  Employers generally may not require or request an employee or job applicant to take a lie detector test, or discharge, discipline, or discriminate against an employee or job applicant for refusing to take such a test.  Employers are required to display the EPPA poster in the workplace for their employees.  There are, however, certain exemptions that will be discussed below.

Ongoing investigation exemption

According to federal law, an employer is not prohibited from requesting an employee to submit to a polygraph test if: 1) the test is administered in connection with an ongoing investigation involving economic loss or injury to the employer’s business, such as theft, embezzlement, misappropriation, etc.; 2) the employee had access to the property that is the subject to the investigation; 3) the employer has a reasonable suspicion that the employee was involved in the incident or activity under investigation; and 4) the employer executes a statement, provided to the examinee before the test that a) sets for the with particularity the specific incident or activity being investigated and the basis for testing particular employees, b) is signed by a person, other than the polygraph examiner, authorized to legally bind the employer, c) is retained by the employer for at least three years, and d) contains an identification of this specific economic loss, etc.

Security services exemption

Another federal exemption is the exemption for security services.  Federal law does not prohibit the use of polygraph tests on perspective employees by any private employer whose primary business purpose consists of providing armored car personnel, personnel engaged in the design, installation, and maintenance of security alarm systems, or other uniformed or plained clothes security personnel. 

Other federal exemptions

In addition to the above exemptions, there are other exemptions for national defense, government security, FBI contractors, etc. 

California law

California Labor Code section 432.2 states that “no employer shall demand or require any applicant for employment or perspective employment or any employee to submit to or take a polygraph, lie detector or similar test or examination as a condition of employment or continued employment.”  In addition, Labor Code section 432.2 states that “no employer shall request any person to take such a test, or administer such a test, without first advising the person in writing at the time the test is to be administered of the rights guaranteed by this section.”

Government employee exemption

However, there is an exemption in Labor Code section 432.2 which states that the prohibition of this section does not apply to the Federal Government or any agency thereof or the State Government or any agency or any local subdivision thereof, including, but not limited to, counties, cities, districts, etc.  Employers need to be sure that these perspective employees would be hired by the actual government entity and not simply contracting with the city/county, or employed by someone else and simply doing work for the city/county. 

Conclusion

While there are some exemptions to the federal and state law prohibitions of polygraph tests in the workplace, the safest thing to do is avoid them.  The accuracy of polygraph tests has been questioned for years, and the risk employers run in requiring their employees to submit to such tests will almost always outweigh the benefit.

Sexual Harassment Training 101

All employers know that sexual harassment is among the most serious of workplace problems. California has passed legislation showing the importance of preventing workplace sexual harassment.  California Government Code section 12950.1 requires that employers comply with certain sexual harassment training rules and procedures.

Which employers must provide training?

This law applies to employers with 50 or more employees.  It is not required that all 50 employees be in California. 

Who must be trained?

Training must be given to all employees who are employed as supervisors as of July 1, 2005.  All employees who become supervisors after July 1, 2005 must receive training within six months of assuming a supervisory position. 

Who is a supervisor?

The new law does not define the word “supervisor.” Yet, the Fair Employment and Housing Act defines a “supervisor” as, among other things, one who has the authority to hire or fire, reward or discipline other employees, direct other employees, or exercise independent judgment.  This is a broad definition, and whether an employee is exempt or non-exempt for purposes of wages is not controlling. 

Employers should construe “supervisors” broadly - if there is doubt as to whether your employee is a “supervisor,” train them just to be safe. 

What type of training is sufficient?

The law requires that the training be of the “classroom” variety or other “interactive training.”  California’s Department of Fair Employment and Housing has strongly suggested that web-based training is sufficient as “interactive” training.  However, if a trainer is not actually present, one should be available to answer questions within two business days after the question is asked.   Furthermore, the training must include practical examples dealing with prevention of harassment, discrimination and retaliation.                    

Who can train?                                                                      

Three categories of people are qualified to train: (1) attorneys, (2) professors or instructors, and (3) Human Resource professionals or Harassment Prevention Consultants.  For each category, the trainers must have two years of experience.

How often must employees be trained?

Employees covered by the law must be trained every two years. 

How much training is needed?

If the training is conducted as “classroom training,” the actual time instructors spend teaching must total two hours, excluding breaks.  If the training is web-based, it must take at least two hours to complete the course.

What records need to be kept?

The biennial training can be tracked by the individual employee, or by using a “training year” method in which the employer chooses training years for all supervisors.  Employers must remember, however, that new supervisory employees must be trained within six months of hire or promotion.  A record of who received the training, when it took place and what type, and who gave the training must be kept for two years. 

Final Points

Proper training does not completely safeguard employers from sexual harassment lawsuits.  Also, failure to provide training does not, in and of itself, make an employer liable for sexual harassment.  However, the Fair Employment and Housing Commission can order an employer to give proper training.  Yet if employers fail to properly train supervisory employees, a court could find that such violates the state’s public policy, creating even more liability if an employer is sued for sexual harassment.  Ensuring that employees are properly trained requires some effort and planning - yet in this regard, it is certainly worth it. 

Overtime and the occasional California employee

California overtime laws are among the most complex laws in the labor and employment law sphere. Employers are required to juggle various complicated overtime exemptions, as well as keep track of employee hours to make sure they don’t run afoul of any overtime laws. A recent case has added a new wrinkle to California’s overtime laws.

In a nutshell, California overtime laws apply to all non-exempt employees. Generally speaking, non-exempt employees working more than 8 hours in a day or 40 hours in a week are entitled to receive overtime pay. But what about employees who only occasionally work in California? In the case of Sullivan v. Oracle Corporation, the California Supreme Court tackled just this issue. The plaintiffs in the Sullivan case were employees that periodically worked in California. They wanted California overtime law to apply during any full day in which they worked in California.

The California Supreme Court sided with the plaintiffs, holding that when employees visit from other states, California overtime law applies: “To exclude nonresidents from the overtime laws’ protection would tend to defeat their purpose by encouraging employers to import unprotected workers from other states. Nothing in the language or history of the relevant statutes suggests the Legislature ever contemplated such a result.”

Yet the court was also careful to note that its holding was limited to just overtime, not necessarily to other wage and hour laws:

While we conclude [our] analysis does require us to apply California’s overtime law to…work performed here by nonresidents, one cannot necessarily assume the same result…for any other aspect of wage law. California…has expressed a strong interest in governing overtime compensation for work performed in California. In contrast, California’s interest in the content of an out-of-state business’s pay stubs, or the treatment of its employees’ vacation time, for example, may or may not be sufficient to justify choosing California law over the conflicting law of the employer’s home state. No such question is before us.”

In essence, the court punted on the non-overtime issues. Because the issue of whether to apply all California wage and hour law to visiting employees was not before the court, the court chose to simply wait until that specific issue was before them.

So listen up companies that employ workers that work periodically in California – California overtime law applies whenever these employees work in California. Stay tuned for whether all California wage and hour laws apply as well.