In the past few months, California Governor Newsom has signed numerous new employment laws affecting California employers of all sizes. Below is a summary of some of the laws going into effect in 2024.

Workplace Violence Prevention Safety Plan

California will become the first state to demand employers to create an “effective” workplace violence prevention plan, train employees, and prepare/maintain records regarding workplace violence, starting July 1, 2024. SB 553 covers virtually all employers. “Workplace violence” is defined as “any act of violence or threat of violence that occurs in a place of employment that results in, or has a high likelihood of resulting in, injury, psychological trauma, or stress, regardless of whether the employee sustains an injury.”

Not only must employers prepare a written prevention plan that is accessible to employees, they are also required to keep a “log” of every “workplace violence incident” and implement requisite training when the plan is first established. Moving forward, employers will need to provide training on an annual basis. Additionally, certain training records must be maintained for one to five years, depending on the type of record. For more information on the new law, please review Sheppard’s recent blog post on this topic here.

Paid Sick Leave Expansion

SB 616 amends California’s Healthy Workplaces, Healthy Families Act of 2014 to raise the amount of paid sick time employees can obtain each year from three to five days (or 40 hours) for full-time employees. The law also expands the annual accrual limit from six days (or 48 hours) to 10 days (or 80 hours).

Employers using the “front-loading” method of allowing paid sick leave must now supply five days (40 hours) at the beginning of the year. Employers using a different accrual process must now guarantee an employee has at least 40 hours of accrued sick leave by the 200th calendar day of employment, in addition to the requirement that employees have at least three days (24 hours) by the 120th day of employment. Employees must be allowed to use at least five days (40 hours) each year. For additional information, please review Sheppard’s recent blog post on this topic here.

Minimum Wage Increases

On January 1, 2024, the statewide minimum wage will increase to $16 per hour. The minimum exempt salary for California employees will rise from $64,480 to $66,560. In addition to the increase in the state minimum wage, many localities have their own minimum wage requirements that are higher than the state’s minimum wage.

Notably, the minimum wage increase for specific industry employers, such as healthcare facilities, begins June 1, 2024. The new minimum wage for healthcare facilities will range from $18 to $23 per hour, depending on the size and location of the facility. Fast food workers will also see a similar increase, to $20 per hour, beginning April 1, 2024.

No Automatic Stay During Appeals of Motions to Compel Arbitration Decisions

SB 365 amends the California Code of Civil Procedure with the intention of not automatically staying trial court proceedings when a party appeals an order denying a motion to compel arbitration. This law allows courts to use their discretion as to whether to stay proceedings while an appeal is heard. The law will likely be contested in court, on the basis that it is preempted by the Federal Arbitration Act (“FAA”). For additional information, please review Sheppard’s recent blog post on this topic here.

Prosecution for California Labor Code Violations

AB 594 empowers local prosecutors to pursue a civil or criminal action for violations of the California labor code that arise within their jurisdiction. The law also states that any agreement between the employer and employee that attempts to “limit representative actions or to mandate private arbitration” will not be enforceable.

Rebuttable Presumption of Retaliation

SB 497, known colloquially as the “Equal Pay and Anti-Retaliation Act, amends the California Labor Code to create a rebuttable presumption of retaliation if an employee is disciplined or terminated within 90 days of engaging in certain protected activity. Employers also are responsible for a civil penalty of up to $10,000 per employee for each violation, to be awarded to the employee who faced retaliation. For more information on the new law, please review Sheppard’s recent blog post on this topic here.

Reproductive Loss Leave

SB 848 requires employers to offer a leave of up to five days following a “reproductive loss event,” which is “the day or, for a multiple-day event, the final day of a failed adoption, failed surrogacy, miscarriage, stillbirth, or an unsuccessful assisted reproduction.” The leave is restricted to 20 days within a 12-month period, and employees must be allowed to take their leave non-consecutively. Leave may be unpaid, but employees must be permitted use sick leave or other paid time off if they so choose. Information provided to the employer by the employee relating to the leave must remain confidential and cannot be disclosed, unless required by law. SB 848 also forbids retaliation for an employee’s use of this leave.

Noncompete Agreements

SB 699, which becomes operative January 1, 2024, clarifies that existing law prohibits noncompetition covenants regardless of where or when the agreement was signed, even if the covenant was signed outside of the state. An employer will now commit a civil violation for entering into or enforcing a void noncompete. Employees will also now have a private cause of action against their employer.

In a similar vein, AB 1076 requires employers to contact all current or former employees who were employed after January 1, 2022, and had (or have) contracts containing a noncompete clause, informing them that the noncompete clause is void. The notice must be completed by February 14, 2024, and is required to be in writing and delivered to both the last known physical address and email address of the employee. If an employer fails to send this notice, it constitutes a violation of California’s Unfair Competition Law. For additional information, please review Sheppard’s recent blog post here.

Emergency or Disaster Declaration Information

Effective January 1, 2024, AB 636 expands the information required in employers’ wage theft notices. This new law requires these notices include information regarding “[t]he existence of a federal or state emergency or disaster declaration applicable to the county or counties where the employee is to be employed” that affect employees’ health and safety during their employment. While the California Labor Commissioner’s office is preparing a notice template by March 1, 2024, employers should bring their notices up-to-date in the interim. 

Cannabis Use

AB 2188 amends the California Fair Employment and Housing Act (“FEHA”) to prohibit an employer from discriminating against an employee or applicant because of the employee’s or applicant’s cannabis use off the job and away from work. Notably, this new law does not permit an employee to possess, be impaired by, or use cannabis while working, meaning employers may continue to enforce any policies they have prohibiting employees from possessing, being impaired by, or using cannabis while on the job. For additional information on the protections around employees’ cannabis use, please review Sheppard’s blog post here.

Takeaways

These new employment laws are extensive. Employers should evaluate and revise relevant policies and practices, including employee handbooks and employment agreements containing restrictive covenants, to ensure compliance. Employers should also start preparing workplace violence prevention plans to be in compliance by July 1, 2024.