With the blizzard of new legislation that blanketed California at the beginning of the New Year, the strengthening of employment laws is a topic of interest that continues to evolve. It’s an area where old standards that have been in place for decades are starting to see some significant change, but it can also be confusing to understand the true impact California’s latest set of employment laws will have on employers and employees alike. We sought out a pair of employment lawyers to help break down five of the new laws that were signed toward the end of 2021 and are being put to work for us starting in January of 2022.SB 62: Creating More Employer Liability in the Garment Industry

The garment industry has long been an area of workers’ rights violations. This bill, authored by Sen. Maria Elena Durazo (D-Los Angeles) is designed to hold manufacturers accountable to their subcontractors. It clarifies the industry standard that a person or company that is contracting out work to make garments is liable for any unpaid wages, damages, penalties and other compensation owed to the workers who manufactured the garments.

“It was noted in the basis for the legislation that the average wage of garment workers was around $5.50 an hour, way below the California minimum wage, so they’re trying to remedy that, said Arlene Yang, an attorney for employment law firm Meyers Nave. “It sounded like many companies in the garment industry, were not opposed to it. According to press reports, it looks like New York is considering something similar because both New York and LA had very large garment industries.”

Under the new law, garment companies are on the hook for liability regardless of the number of layers of contracting between the company and the workers, which will go a long way toward eliminating the shell game that allows clothing brands to pass the buck on worker liability. The new law also prohibits the use of piece-rate compensation when calculating expenses for garment manufacturing. The only exception occurs in cases where worksites are covered by a collective bargaining agreement.

“The problem with piece rate is it can be difficult, especially when people are dealing with a lot of pieces, which presumably people in the garment industry are, it can be challenging to figure out,” says John Hyland, an employment attorney for San Francisco-based firm Rukin Hyland LLP.  “It often provides an opportunity for some unscrupulous business people to not keep accurate records.”

SB 331: Navigating Severance and Non-Disparagement Agreements

California’s “Silenced No More Act,” introduced by Sen. Connie Leyva, (D-Chino) last October, amended existing California law restricting the use of confidentiality and non-disparagement provisions in employment agreements–this also extends to settlement and severance agreements.

The law was originally passed in the midst of the #MeToo movement and has since been extended to include discrimination or harassment against any protected class, making it so employees won’t feel prohibited from telling the factual circumstance of the discrimination. It’s a continuation of legislative changes that have been put into place following the #MeToo, sexual harassment concerns in the workplace. Under SB 331, employers cannot require an employee to sign a release or non-disparagement agreement that would prevent them from disclosing information about illegal acts in the workplace like sexual harassment. Non-disparagement provisions are only valid if there’s a disclaimer that says nothing in the agreement prevents an employee from disclosing information about unlawful acts in the workplace.

“This is just expanding the limitations on what can be in settlement agreements, or severance agreements and are also related to non disparagement language,” Yang said. “So it is a change of practice and it makes California unusual compared to most other states as to what kind of information can be in these non-disparagement agreements or people’s ability to speak after they’ve entered into some agreement.”

The new law also requires employers to notify an employee that they have a right to consult an attorney in the process of considering or agreeing to a severance package. Employees are to be given no less than five business days to make a decision with the help of an attorney. However, confidentiality clauses are still a tool that can be used by employers in terms of prohibiting disclosure when it comes to the amount of a settlement.

Though this new law goes a long way to limit a company’s ability to buy silence from employees with valid discrimination or harassment claims, Hyland says there could be instances where it works against an employee should they want to settle with a company quietly.

“Let’s assume, for example, that you filed a claim of discrimination, and you wanted to settle that claim. And the companies would sayit would be worthwhile for us to not litigate this. Very often, what companies are paying for is the ability to keep something quiet,” Hyland says. “Now that the law prohibits the employer from getting that confidentiality, I think there are a lot of people individually who might say that’s all well and good, but now the company is not really willing to pay me that much.”

SB 606: Cal/OSHA Adds New Definitions to Its Health and Safety Rules

Senate Bill 606, co-authored by State Sen. Lena Gonzalez and former Assemblywoman Lorena Gonzalez, expands enforcement power of the California Division of Occupational Safety and Health’s (Cal/OSHA) with the creation of two new violation categories: “enterprise-wide” and “egregious.”

Under the new law, an employer with a violation at one worksite may be presumed to have equal or similar violations at other owned worksites, making it an “enterprise-wide” violation. SB 606 also allows Cal/OSHA to issue citations to an employer characterized as “egregious” for several willful violations. The definition for an “egregious” violation could include a worksite catastrophe, worker fatalities, or widespread injury or illness. Once a violation is classified as “egregious,” that determination stays in effect for five years.

The law calls for each instance of an employee’s exposure to the particular egregious violation to be considered a separate violation. Penalties for “enterprise-wide” or “egregious” violations are steep–maxing out at $123,709 per violation.

“It highlights the importance of the fact that employers need to have their ducks in a row and take the time to set up processes in advance before OSHA comes knocking on their door,” Yang said. “We have this ‘enterprise-wide’ violation, which creates a presumption that there was a violation. It’s a rebuttable presumption, but a presumption that there’s a violation if the policies were non-compliant. That’s quite a change from how it had been in the past.”

From an employer’s perspective, Hyland says, trying to keep up with the changes in COVID regulations continues to be an ever-evolving obstacle.

“Employers are required to have a COVID prevention policy in place. And that would be a good example of where OSHA might be able to come in and extract some significant fines,” Hyland says. “If they were to come in and say let me see your COVID policy, I suspect there are a number of employers that are going to find that they have policies that are now out of date and those policies to the extent that you can link them to be the root cause of some OSHA violations are obviously going to create some significant problems.”

AB 701: Regulating Warehouse Quotas

With the arrival of this new bill from Lorena Gonzalez, California became the first state in the country to regulate quotas used by warehouse employers. Though the bill was initially designed to target larger employers like Amazon and other warehouse operators across the state, the legislation now includes all companies employing 100 or more workers per distribution center as well as employers that have over 1,000 total warehouse employees in the state.

Under SB 701, employers are required to provide each non-exempt warehouse employee with a written description of each quota under which they are subjected, including their daily tasks on site, any materials they will be producing or handling, scheduled work time periods and any other potentially adverse employment actions that could be triggered if the workers fail to meet their quotas.

However, employees won’t be expected to meet quotas that prevent meal and rest breaks, use of bathroom facilities or health and safety laws.

“It’s a very interesting statute,” Yang said. “Because it’s really kind of getting into how productivity is measured and this state is really getting into inserting itself to say that certain types of practices are not permitted–or just favoring very high quotas.” Yang notes that this is also a fear of California employers who may be considering moving their operations outside the state.

Because employers are required to provide written documents outlining the different quotas each employee is responsible for upon hire or within 30 days of their employment beginning, employers should let workers know what exactly will be required for each position and to communicate this with candidates during the process of interviewing for the job.

Hyland notes that many employers who have a clear quota system in place should understand the lengths to which production can happen both efficiently and safely in a way that doesn’t make them a constant target for litigation. “On one hand, it may seem like  companies want to squeeze as much out of employees as possible. But they also have to balance that against safety issues,” Hyland said. “And there’s already laws mandating that employees get breaks. So it just doesn’t make sense that they would set a quota that’s going to require somebody to skip breaks because skipping breaks or being unable to take breaks, gives rise to separate liability under the labor code.”

AB 1033: Medical and Family Leave

Assembly Bill 1033, authored by Assemblywoman Rebecca Bauer-Kahan (D-Orinda), requires that employers allow eligible employees to have up to 12 weeks of job-protected time off from work per year. The law stipulates that the time off would be for the purposes of providing care to a parent-in-law with a serious medical illness under the California Family Rights Act (CFRA).

According to the law, before an employee of a small business (which would include any business with between five and 19 employees) files a lawsuit based on an alleged CFRA violation, that employee is required to submit a claim for mediation from the Department of Fair Employment and Housing.

Yang notes that the big change for employees seeking improvements in family medical leave  policies was in 2021, when the California Family Rights Act–the state equivalent to the federal Family Medical Leave Act–was expanded to include businesses with five or more employees before it was 50 or more employees. That increased the number of employers who had to be paying attention to whether protected, unpaid leave was available for their employees. “So there’s a small expansion issue with the parents-in-law edition and then there’s also this new mediation pilot program for allegations of violation for small employers. So well, I guess we’ll see how effective that is” Yang said.

Though it is a necessary addition to the current legislation on family medical leave, Hyland notes that it’s basically a correction of an omission in the California Family Rights Act in 2021.

“There was a provision in the old version of the bill that referenced parents-in-law. But there was no other area where it needed to be in order for it to have an effect that had not been revised. So it was a clear editing or a drafting error on the part of the legislature,” Hyland said. “So we had this parent-in-law reference that had no meaning or no impact, because it didn’t show up in all the right places. And I think that obviously they wanted to have a broad reading of this and to include parent-in-law, but I think the change this year did not come because we want to further improve the law and we find a need to expand it even further. I think it’s because we intended to expand the definition of  family at the time we amended it back in 2021 and this had slipped through so we went back to correct it.”