Important Employer Updates
Raise in Local Minimum Wage to Take Effect in Several Counties on 7/1/23 On July 1, 2023, several local minimum wage increases will begin across California, due to the raise in the California state minimum raise that occurred earlier this year on January 1, 2023. The counties listed below have enacted ordinances that require their minimum wage to be higher than that required by the state. The following table shows the counties that will be affected on July 1, 2023:
It should be noted that for certain exempt California employees, these local increases do not affect the minimum salary requirement, which is based on the state minimum wage.
Steps employers can take to protect themselves:
Be aware of local minimum wages: Knowing if the location in which you are doing business has different minimum wage laws is critical to avoiding wage and hour liability.
Traveling Employees: Become aware of how the law applies in some jurisdictions to employees that travel and work in different counties. The cities of Los Angeles and Santa Monica, for example, assert jurisdiction over workers who are in their jurisdiction for a minimum of two hours a week. Make sure to review jurisdictions where employees travel to avoid confusion and ensure compliance.
Notify Employees: All affected employers should ensure that minimum wage postings are updated and posted in the workplace prior to July 1, 2023, to allow any questions and discussion on the matter to take place before the increase is implemented.
Further, ensure that all employees hired after July 1 are hired at the correct rate. This includes updating the wage information section, as well as the overtime rate of pay section on the Notices to Employee requires under Labor Code Section 2810.5, which must be given to all nonexempt employees at the beginning of the hiring process, and in any payroll software/service you may be utilizing.
Update Paystubs: Ensure that paystubs and all other documentation are updated to accurately reflect the increase, and to meet all requirements under Labor Code 226.
The McLaren decision and the following NLRB notice On February 21, 2023, the NLRB issued a decision in McLaren Macomb, where the Board stated, in part, that they are now “returning to the longstanding precedent holding that employers may not offer employees severance agreements that require employees to broadly waive their rights under the National Labor Relations Act.” This case specifically involved severance agreements offered to furloughed employees that prohibited them from making statements that could disparage the employer and from disclosing the terms of the agreement itself. This decision is yet another reminder that all employees, whether a member of a union or not, have certain specific rights in the workplace. As a result, employers must review their policies and procedures to make sure that they do not have overly broad confidentiality policies or procedures, including ones in severance agreements or settlement agreements, or other policies or procedures which may inadvertently limit the rights granted to employees under the National Labor Relations Act. In March 203, the Board put out a memo in response to McLaren, which includes more guidance on the topic, and can be found here. Be sure to review the guidelines and update company handbooks in regard to confidentiality policies. Please contact us with any questions or if you would like assistance updating your handbook. Fair Chance Act: A New Bill proposed regarding limitations on criminal background checks
In February 2023, a bill was introduced called the Fair Chance Act. As most should be aware, under the current law, California employers with five or more employees are prohibited from asking about criminal convictions on job applications, or from considering the conviction history of an applicant before extending a conditional job offer to them. Further, it requires an employer who intends to deny an applicant a position of employment solely or in part because of the applicant’s conviction history to make an individualized assessment of whether the applicant’s conviction history has a direct and adverse relationship with the specific duties of the job, and to consider certain topics when making that assessment.
However, the new proposed bill will add even greater limitations on the use of, and procedures around the use of, criminal background checks for the purposes of hiring, transferring, or promoting employees. We’ll spare you the details until the bill passes but now is a good time to make sure that you’re following the current requirements, to review what types of convictions your company is using to exclude applicants, and if those reasons are legitimately tied to the job or not.
If you have any questions regarding the above guidance, please contact the experts at Young, Cohen & Durrett, LLP at (916) 569-1700.