My last post discussed AB469, which came into effect January 1, 2012.  Since then, to ease the burden associated to this piece of law, the California Department of Industrial Relations has provided the general public with a template to use that, when completed, complies with the requirements of AB469.  Indeed, this template makes following AB469 much easier.  Click here to be directed to this template in English.  Though, if you need this template in Spanish, click here.

And, yet another new employment law being enacted on January 1, 2012.  AB469 will require employers to provide newly hired, non-exempt employees written notice of the following:

• The rate or rates of pay and basis thereof, whether paid bythe hour, shift, day, week, salary, piece, commission, or otherwise, including any rates for overtime, as applicable.
• Allowances, if any, claimed as part of the minimum wage, including meal or lodging allowances.
• The regular payday designated by the employer inaccordance with the requirements of this code.
• The name of the employer, including any “doing business as” names used by the employer.
• The physical address of the employer’s main office or principal place of business, and a mailing address, if different.
• The telephone number of the employer.
• The name, address, and telephone number of the employer’s workers’ compensation insurance carrier.
• Any other information the Labor Commissioner deems material and necessary.

Further, if there are changes to the above information during the time of employment, an employer shall notify his or her employees in writing of the changes within seven calendar days after the time of the change.

I know what you are all thinking, this law is a major pain for employers.  Well, I cannot disagree with you there.  This new law should lead to many more new lawsuits.

If you are a employer in California, recordkeeping is a must.  In fact, employers must keep in their possession the hours worked by employees and amounts paid to employees.  Further, employers must keep names and addresses of employees, along with the ages of any employees that are minors.  This information must be kept by the employer for at least two years, and, if there are wage deductions, then for three years (personally, I would recommend for employers to keep these records for at least five years just to be safe).  While said recordkeeping requirements appear to be burdensome, it is necessary under California law.

What if an employee wants to inspect these records?  An employer must allow it, and must provide this information or inspection within twenty-one (21) days  or else the employer may be liable for a $750 fine and the costs and fees in enforcing this fine.

Therefore, given these litigious times, employers, now more than ever, must make a conscious effort to keep records of all information possible that document an employees employment.

The oral arguments in Brinker were heard on November 8, 2011. Based off the questioning by the justices, it appears as if the California Supreme Court is favoring the side of employers (i.e. meal and rest breaks need only be made available, and employees need not be required to take the breaks). The Court has 90 days to issue a decision after the arguments, which should bring us a decision by February 6, 2012.

Tomorrow morning (November 8, 2011) at 9:00 a.m., oral arguments in Brinker Restaurant Corp. v. Superior Court (this case is described in detail below) will begin. Indeed, this case will have a monumental impact on California Employment Law. Stay tuned for additional updates!

As I indicated, I will discuss the new California laws pertaining to Employment Law.  This post discusses AB 22, which has to do with employer credit checks.  Namely, this law, which commences January 1, 2012, prevents employers from requesting credit reports from an employee.  However, certain employers are exempt from following AB 22, such as law enforcement, financial institutions, and the State Justice Department.  Other exceptions apply to employers who hire employees that, during the course of their employment, will have access to an individual ‘s bank or credit card information, or social security numbers and date of birth.  Exceptions also apply when employees have access to an employer’s trade secrets or proprietary information, as well as when employees sign checks, financial contracts or credit cards for an employer.  There is also an exception when an employee transfers money for an employer, has access to more than $10,000 cash, or is a manager that is exempt from overtime law.

Indeed, this law is directly related to the downturn in the economy.  In fact, the law is designed to prevent employers from refusing to hire an individual based on his financial state, especially considering more and more Californians are suffering financially as the unemployment rates and number of bankruptcy filings increase.

While employers may fear that this law may keep them up at night in fear of embezzlement or theft, employers should understand that AB 22 does not apply to background checks on criminal records, driving records or verification of income or employment.

Just within the past month, many new employment laws have been enacted and will take effect come January 1, 2013.  One of these laws sympathy is AB 1396.  This piece of law deals with commission payments.  Namely, commission pay arrangements will now need to be memorialized in a written contract.  Therefore, after January 1, 2013, anytime an employee performing services in California is compensated by commission, there must be a contract, in writing, between the employee and employer stating precisely how such commission will be calculated and how such commission will be paid.  Indeed, AB 1396 is yet another formality employers must adhere to in California.  Further, the employer must retain a signed acknowledgment from the employee, while providing the employee with a copy of the contract.  In the event an employer fails to adhere to this law was in effect, the employer may be penalized $100 for each day (and each harmed employee) in violation of the law.

In 2008, the California Supreme Court granted review of Brinker Restaurant Corp. v. Superior Court. In Brinker, the California Court of Appeal held that California employers only need to make meal and rest periods available, and do not need to ensure the meal periods are taken.  The California Courts of Appeal made a similar ruling in Brinkley v. Public Storage, Inc.

While both rulings are on hold until the Supreme Court makes a decision on Brinker, it is believed that the court will affirm these decisions and ease the burden put on employers through California’s wage and hour laws and affirm California Courts of Appeal’s decision.

The California Supreme Court will also decide whether employers will be able to offer meal periods and rest periods at off-peak hours earlier than the employer’s “rush.”  If the Court allows this, employers may have employees take their meal and rest breaks prior to times when the employer’s establishment is busy.

Indeed, it is 2011 now and a decision has still not been made.  However, one should be forthcoming within the next few months.  Until then, lawyers, employers and employees will be sitting on the edge of their seats.

These laws mainly focus on overtime, missed meal and rest breaks and failure to provide itemized wage statements. Unfortunately for employers, both large and small, it is very difficult to consistently, and fully, comply with California wage and hour laws. For example, a small restaurant with a limited amount of employees may accidentally forget to tell an employee to take her rest break within the four hour window provided by law, thus, violating California law. Yes, the laws are that cruel.

Below is a summary of California’s laws pertaining to overtime and break periods, which happens to be the most violated wage and hour laws:

Overtime Laws

• For each hour worked over eight (8) hours, up to and including twelve (12) hours, in a single work day, an employee is entitled to one and a half times the employee’s regular rate of pay. For example, if an employee making twenty dollars ($20) per hour works ten (10) hours one day, he is entitled to twenty dollars ($20) per hour for the first eight (8) hours worked and then thirty dollars ($30) per hour for the last two (2) hours worked.
• For each hour worked over twelve (12) hours in a single work day, an employee is entitled to double the employee’s regular rate of pay. For example, if an employee making twenty dollars ($20) per hour works fifteen (15) hours one day, he is entitled to twenty dollars ($20) per hour for the first eight (8) hours worked, thirty dollars ($30) per hour for the next four (4) hours worked, and then forty dollars ($40) per hour for the last three (3) hours worked.
• If an employee works seven (7) consecutive days, on the seventh day, an employee is entitled to one and a half times the employee’s regular rate of pay for up to eight (8) hours worked on that day. For any hour worked beyond eight (8) hours on that seventh consecutive work day, an employee is entitled to double their regular pay. For example, if an employee making twenty dollars ($20) per hour works ten (10) hours on seventh consecutive day he has worked, he is entitled to thirty dollars ($30) per hour for the first eight (8) hours worked and then forty dollars ($40) per hour for the last two (2) hours worked.

Meal Break Laws

• An employer must provide an employee with at least a thirty (30) minute meal break for work periods of five (5) hours or more. However, if the employee works six (6) hours or less, the meal period may be waived by mutual consent of both the employer and employee.
• A second meal period of at least thirty (30) minutes is required if an employee works more than ten (10) hours in a day.
• If the employer requires the employee to remain at the work site or facility during the meal period, the meal period must be paid. This is true even where the employee is relieved of all work duties during the meal period.
• Unless the employee is relieved of all duties during his meal period, he will be considered “on the clock” during his this time.
• The employer must pay one additional hour of pay at the employee’s regular rate of pay for each workday that the meal period is not provided.

Rest Break Laws

• As long as practicable, rest breaks must be provided in the middle of each work period. The rest period must be a minimum of ten (10) consecutive minutes for each four (4) hour work period. A rest period is not required for employees whose total daily work time is less than three and one-half hours.
• The rest period is counted as time worked and, therefore, the employer must pay for such periods. Since employees are paid for their rest periods, they can be required to remain on the employer’s premises during such periods.
• Employers are required to provide suitable resting facilities that shall be available for employees during working hours in an area separate from the toilet rooms.
• If an employer does not provide all of the rest periods required in a workday, the employee is entitled to one additional hour of pay for that workday, and not one additional hour of pay for each rest period that was not provided during that workday.

As one can see, the above laws are easy to violate, and difficult to strictly comply with. However, fortunately California courts are beginning to realize this and now tend to interpret laws in a light more favorable to employers (more on that in later posts).