This year has brought a variety of new challenges and obligations for employers in California and across the nation. Now, as summer fades and the fourth quarter of the business year begins, employers should take stock of the following employment law trends as they wind down 2017 and prepare for the year ahead.
Deferred Action for Childhood Arrivals (DACA)
On September 5, 2017, the Trump administration announced that it would phase out DACA, which provides deportation protection and work permits to unauthorized immigrants who came to the United States as children. Absent a quick legislative solution by Congress, the phasing out of the program effectively sets work eligibility expiration dates for an estimated 800,000 DACA recipients. Employers should keep posted on further developments, as recent discussions between President Trump and members of Congress indicate that a deal to protect those affected by the DACA rescission may be reached in the near future,.
Until then, employers should be certain that they are properly tracking, for Form I-9 purposes, when employee work eligibility expires, and must obey the law when their workers are no longer eligible to work. In doing so, however, employers must take care to not jump the gun and take action against DACA recipients before their work eligibility actually expires. Taking action too early could result in claims of discrimination and wrongful termination based race or national origin, as well as I-9 violations.
The federal Office of Management and Budget recently announced that it was issuing an immediate stay of the revised EEO-1 form, which had been slated to take effect in March 2018 and would have required employers with 100 or more employees to substantially expand the information disclosed to include data on pay and hours worked. The Equal Employment Opportunity Commission (EEOC) and Office of Federal Contract Compliance Programs (OFCCP) had planned to use the new data to step up enforcement of federal wage bias laws.
Although this reporting requirement has been put on hold, employers still need to be vigilant regarding compliance with applicable equal pay laws, including at the state level. California, in particular, has been on the forefront with respect to equal pay, with the recent passage of the Fair Pay Act, which requires equal pay for “substantially similar” work based on gender, race and ethnicity. In addition, Assembly Bill 168, which is currently pending in the California Senate would, if passed, bar employers from inquiring about applicant salary history.
Employers should take proactive steps to evaluate their compensation policies and practices and consider conducting a self-evaluation (possibly under the direction of legal counsel) to identify and fix any pay disparities – before disputes arise.
Paid Family Leave
The United States remains among only a handful of countries without federally-mandated paid family leave – and just 14 percent of private workers in this country receive paid leave through their employer. That may be changing. For example, this year San Francisco’s landmark Paid Parental Leave Ordinance took effect, requiring employers to supplement state paid family leave benefits for up to six weeks.
At the same time, companies that provide their own paid family leave benefits may want to take a close look at how such benefits are allocated, in light of a new gender bias suit filed by the EEOC against Estee Lauder Companies, Inc. The EEOC charges that the cosmetics company violated the federal Equal Pay Act and Title VII by maintaining a policy of providing two weeks of paid parental leave for child bonding to fathers, in contrast to six weeks of paid parental leave for child bonding to mothers (separate from paid leave for childbirth recovery). A similar lawsuit recently was filed against J.P. Morgan Chase & Co. Employers should anticipate that more lawsuits like these will follow and evaluate their paid leave policies accordingly.
Marijuana In The Workplace
While marijuana use remains illegal under federal law, the passage in California of Proposition 64, the Adult Use of Marijuana Act, will make recreational cannabis legal effective January 1, 2018. The conflict between federal and state law has led to some confusion about whether employers will be required to accommodate their employees’ use or possession of the drug. On the one hand, Proposition 64 expressly protects an employer’s right to maintain workplace policies relating to marijuana, which would generally include narrowly crafted drug testing policies. On the other, court decisions like the recent Massachusetts Supreme Judicial Court’s ruling in Barbuto v. Advantage Sales and Market, LLC (Mass. 2017) 477 Mass. 456 – where the court ruled that an employee who was fired after testing positive for marijuana during the hire process could proceed with her disability bias claim – highlights that employee rights relating to marijuana are expanding, particularly where marijuana use is connected to treatment for an employee’s disability.
As this area of law continues to develop, employers should regularly assess their written policies, training and education of employees to ensure compliance with California’s drug testing and disability laws.
Ban The Box Laws
“Ban the Box” or “fair chance” laws are increasingly widespread across the United States. These laws generally require employers to remove questions about criminal convictions from job applications and to postpone criminal background inquiries until later in the hiring process, usually after a conditional offer of employment is extended, to give applicants an opportunity to explain their criminal history. Twenty-seven states currently have some form of Ban the Box law applicable to public-sector workers and nine states have extended such laws to private employers as well.
California does not have a statewide Ban the Box law yet, but Assembly Bill 1008, if passed, would amend the Fair Employment and Housing Act (FEHA) to ban criminal history inquiries on job applications and require employers to make individualized assessments before denying employment based on past convictions. San Francisco and Los Angeles already have fair chance ordinances on the books for private employers. Employers operating in those cities should review their hiring processes and train managers to ensure compliance. Employers should also keep an eye on Ban the Box legislation at the state and local level, as there are no signs that this trend is abating.
Class Arbitration Provisions
The validity of class action waivers in employment arbitration agreements is a hot topic that many employers are tracking, now that the U.S. Supreme Court has granted review to three consolidated cases on this issue. Briefing has already been submitted, and oral argument is expected this fall. The Court's decision to take up the issue follows a circuit split last year, where the Fifth and Eighth Circuits upheld such waivers and the Seventh and Ninth Circuits ruled that they violated the National Labor Relations Act (NLRA). Regardless of the outcome, the Court's decision will have a widespread effect on employers’ use of class action waivers. Until then, employers who use – or wish to use – arbitration agreements with class waivers should be certain to consult with counsel to review or draft such agreements to make sure they are in step with current requirements.
On the federal level, the Trump administration has rolled back protections for LGBTQ federal workers this year. On March 27, 2017, for example, the President signed an Executive Order rescinding the Fair Pay and Safe Workplaces Act, an Obama-era order that required federal contractors to provide proof of compliance with federal laws protecting LGBTQ persons in the workplace.
In the meantime, California has been expanding rights for transgender workers. The California FEHA has long prohibited discrimination against an applicant or employee based on gender identity, gender expression or sexual orientation. And on July 1, 2017, new FEHA regulations went into effect regarding transgender identity and expression in the workplace. The new regulations require employers to permit employees to use restroom facilities that correspond with the employee’s gender identity and gender expression and to use gender-neutral signage for single-occupancy facilities. Employers also are prohibited, in the absence of business necessity, from imposing dress codes that are inconsistent with an employee’s gender identity or expression, and from requiring documentation on sex, gender, gender identity, or gender expression as a condition of employment. California employers should promptly review their employee handbooks and other policies and practices to ensure they are updated to comply with the new regulations.
Miller Law Group exclusively represents business in all aspects of California employment law, specializing in litigation, wage and hour class actions, trials, appeals, compliance advice and counseling. If you have questions about these developments or other workplace obligations, please contact us at (415) 464-4300.
This Alert is published by Miller Law Group to review recent developments in employment law. This material is designed to provide informative and current information as of the date of the Alert, and should not be considered legal advice.