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30 Nov

November 2020 California HR Legal Updates

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Prop 22 Passes Grants Special Rules for Gig Workers

What happened?
The Uber and Lyft backed Proposition 22 has passed in the 2020 election.

What are the details?
Proposition 22 creates an exemption to AB 5, a worker classification law using the Dynamex court case’s ABC test to classify all workers. Many exemptions have applied to AB 5 since its passage, but gig workers had notably excluded.  Gig economy companies, like Uber and Lyft, spent vast sums of money to promote the passage of Proposition 22, to continue their current business model in California, spending upwards of $225 million in promotional costs.

The proposition creates a new exception to AB 5 by declaring app-based drivers be classified as independent contractors rather than employees. In addition, it will require drivers be paid no less than 120% of the minimum wage for the time they are engaged, as well as payment per mile. Additionally, network companies are required to provide healthcare subsidies and insurance coverage to drivers, develop anti-harassment policies, provide drivers with mandatory safety training, and conduct criminal background checks on network drivers.

Law firms, namely Littler Mendelson P.C., have noted that the passage of Proposition 22 may lead to other states or the federal government to have new conversations about the independent contractor status.

An article further explaining the impact of Proposition 22 can be found here.

You can read the full text of Proposition 22 here.

What do employers need to do?
Gig economy employers operating in California should review the conditions outlined in Proposition 22 to take advantage of the new exemption created for their workers.


Cal/OSHA Approves Emergency COVID-19 Standard

What happened?
On November 19, 2020, the California OSHA Standards Board adopted an emergency standard related to COVID-19 prevention in the workplace, imposing significant requirements on state employers.

What are the details?
The new standards can be in full effect as soon as November 29, 2020.

The new emergency standard will touch on nine new requirements for employers.

  1. A written COVID-19 prevention program
  2. A notice of protentional COVID-19 exposure and cases
  3. Physical distancing
  4. Face coverings and personal protective equipment
  5. Exclusion of COVID-19 cases – and possible new paid time off requirement
  6. General testing requirements
  7. Return-to-work criteria
  8. Workplace outbreaks
  9. Employer-provided housing and transportation

An article going in-depth on each of these requirements can be found here.

An additional article going over this information from a different approach can be found here.

What do employers need to do?
California employers should review the articles linked above and update their workplace policies to reflect the new requirements that will be expected of them.


The CDPH Provides Guidance on AB 685

What happened?
The California Department of Public Health (CDPH) has issued two new pieces of guidance regarding AB 685.

What are the details?
Effective January 1, 2021, AB 685 will create new reporting requirements related to COVID-19 for employers. AB 685’s reporting requirements rely on technical jargon unfamiliar to the majority of employers. In response, the CDPH has issued two resources to clarify what the meaning of some terms contained in AB 685 will mean, and other questions in a Frequently Asked Questions (FAQ) style.

The first resource defines terms used in AB 685. Terms include COVID-19 outbreak, infectious period, and laboratory-confirmed case of COVID-19.

The second resource addresses issues employers have about AB 685 in the form of a FAQ. These questions include:

  • “Who qualifies as a COVID-19 case?”
  • “What information am I required to give workers?”
  • “What does AB 685 authorize Cal/OSHA to do?”

The first resource, containing useful definitions, can be found here.

The second resource, the FAQ piece, can be found here.

A summation article reviewing the aforementioned resources can be found here.

What do employers need to do?
Employers should review the resources while creating workplace policies to ensure compliance with AB 685.


DWC Announces 2021 Temporary Total Disability Rates

What happened?
The California Division of Workers’ Compensation (DWC) announced that the minimum and maximum temporary total disability (TTD) rates would increase on January 1, 2021.

What are the details?
The new rates for TTD are as follows:

This increase is required by California Labor Code section 4453(a)(10), which mandates a parallel TTD rate increase alongside any increase in the State Average Weekly Wage.

The announcement from the DWC can be found here.

An article providing some additional information can be found here.

What do employers need to do?
As the TTD is unique to each state, employers will not need to take any action regarding this update.


San Francisco Passes Tax on Highly Compensated CEOs

What happened?
The voters of San Francisco have passed Proposition L, a tax that will affect companies who compensate their Principal Executive Officer(s) at a rate greater than 100 to 1 when compared to the median compensation paid to the business’ employees based in San Francisco.

What are the details?
The tax will be administered through payroll expenses. Specifically, “for businesses other than an administrative office, the tax rates would be a percentage of gross receipts attributable to the City and, depending on the executive pay ratio, would range from 0.1% to 0.6%.  For businesses engaged in business as an administrative office, the tax rates would be a percentage payroll expense attributable to the City and, depending on its executive pay ratio, would range from 0.4% to 2.4%.”

The full text of Proposition L can be found here.

An article summarizing this Proposition can be found here.

What do employers need to do?
Businesses based in and operating within the city of San Francisco should consult with their payroll technician if they fit the tax’s criteria to determine their next steps.


SB 973 Reporting Requirement Guidance Published

What happened?
The California Department of Fair Employment and Housing (DFEH) has released guidance on the reporting requirements created by SB 973.

What are the details?
Following SB 973 employers will need to provide a pay data report to the DFEH, every year. For 2021, the report will be required by March 31, 2021. For now, the DFEH has only addressed the introduction section, which answers broad questions regarding the reporting requirements, and the filing requirements section, further outlining the filing process.

The DFEH plans to answer additional questions. Employers with questions regarding SB 973 are welcome to submit inquires to

The guidance can be found here.

What do employers need to do?
Employers with questions regarding the required pay data reports should review the guidance available.


SB 778 Training Deadline Approaching

What happened?
The training required by SB 778 needs to be administered before January 1, 2021, for employers to stay in compliance.

What are the details?
SB 778 requires employers with five or more employees to provide sexual harassment training to all supervisory employees for two hours, and at least one hour for all other employees. The deadline of January 1, 2021 has not been postponed due to the pandemic.

The DFEH has provided an online platform offering this training to employers, free of cost. The website can provide supervisory and nonsupervisory training. The training can be found here.

What do employers need to do?
Employers who have five or more employees and have not yet administered the required training should being the steps needed to satisfy the requirement, either through the free resource linked above or through their training program.