California Employment Law: An Employer’s Guide, Revised and Updated : An Employer's Guide

It is often said that it is impossible for an employer to fully comply with all of California’s employment laws. They are just too numerous and too complicated. They are frequently changing, and rarely for the better. There are so many traps for the unwary. Unfortunately, this perspective is mostly true. Part of the problem is that California deems itself to be special. All the employment laws that serve the rest of the country just fine are not considered adequate for California. Instead, the state has its own versions of these laws and its own bureaucracies to enforce these laws. Sometimes these agencies interpret California law consistently with similar federal laws, sometimes not, and sometimes it is not really clear. But the stakes of getting it wrong are quite high for California employers. A simple mistake can lead to a seven-figure jury verdict or a class action lawsuit. California Employment Law: An Employer’s Guide is written for those who must contend with employment law in California as part of their work. This includes employers based outside of California but with employees working inside the state. It is written primarily for business people and HR professionals, not lawyers, although in-house counsel and lawyers who practice outside of employment law will find it useful. The book’s approach is practical. There is no lengthy analysis of court decisions, and there are no footnotes. This book is grounded in the law as it is found in statutes, regulations, and case law, but its focus is on how the law works in the real world. Front Cover 1 Title Page 2 Half Title 4 Copyright 5 Contents 6 Acknowledgements 12 Chapter 1. California Employment Law: How Did This Become So Difficult? 14 1.1 Why California Employment Laws Are So Difficult 14 1.2 Which Law? 15 1.3 The Cost of Getting It Wrong 15 1.4 This Book’s Purpose and Approach 16 Chapter 2. Employment at Will: What It Really Means 18 2.1 Exceptions to Employment at Will 18 2.2 Reinforcing Employment at Will 18 2.3 The NLRB and Employment at Will 19 2.4 Employment at Will versus “Right to Work” 19 2.5 The Limits of Employment at Will 20 Chapter 3. Arbitration of Employment Disputes 22 3.1 Why Arbitration Is a Good Idea 22 3.2 Potential Negatives Regarding Arbitration 24 3.3 Enforceability of Arbitration Agreements 24 3.4 Requiring Arbitration as a Condition of Employment 25 3.5 Use of Arbitration Agreement to Block Class Actions 25 3.6 Arbitration of PAGA Claims 26 3.7 The Franken Amendment and Executive Order 13673 26 3.8 Implementation of Arbitration Agreements 27 Chapter 4. Employee Handbooks 30 4.1 Introductory Language 30 4.2 Employment at Will 31 4.3 Introductory Period 31 4.4 Equal Employment Opportunity 32 4.5 Policy Against Harassment 32 4.6 Policy Against Retaliation 34 4.7 Employee Definitions 34 4.8 Overtime 35 4.9 Meal Periods 35 4.10 Rest Breaks 36 4.11 Lactation Breaks 36 4.12 Paid Holidays 36 4.13 Paid Vacation 37 4.14 Paid Sick Leave 37 4.15 Family and Medical Leave Act/California Family Rights Act Leave 39 4.16 Other Medical Leaves 40 4.17 Pregnancy Leave 41 4.18 Bereavement Leave 41 4.19 Jury Duty Leave 41 4.20 Military Service Leaves 41 4.21 Other Required Leaves of Absence 42 4.22 Electronic Communications 42 4.23 Confidentiality 44 4.24 Social Media 44 4.25 Other Rules of Conduct 45 4.26 Open Door Policy 50 4.27 Arbitration of Disputes 50 Chapter 5. Employees or Independent Contractors? 52 5.1 Determining the Proper Classification 52 5.2 The Consequences of Misclassifying Employees as Contractors 54 5.3 Minimize Your Exposure with Independent Contractors 55 5.4 Other Issues Involving Independent Contractors 57 Chapter 6. The Hiring Process 58 6.1 The Importance of a Current Job Description 58 6.2 Where to Recruit 59 6.3 Staffing Agencies and “Temp-to-Hire” Employees 59 6.4 The Employment Application 59 6.5 Criminal Record Inquiries 60 6.6 Megan’s List 62 6.7 Interviewing Job Candidates 62 6.8 The Use of Social Media to Screen Applicants 63 6.9 Testing of Candidates 63 6.10 Polygraph Testing 63 6.11 Pre-Employment Drug Testing 64 6.12 Background Checks 64 6.13 Reference Checks 66 6.14 Medical Examinations and Inquiries 67 6.15 Onboarding Documents 67 Chapter 7. Paying Employees Correctly 72 7.1 Sources of California Wage and Hour Laws 72 7.2 Coverage of California Wage and Hour Laws 73 7.3 Equal Pay 74 7.4 Minimum Wage 75 7.5 Requirement That Minimum Wage Be Paid for All Hours Worked 78 7.6 Unpaid Interns and Volunteers 79 7.7 Travel Time 80 7.8 Commuting Time 80 7.9 Preparation Time 81 7.10 Education and Training Time 81 7.11 Sleeping Time 82 7.12 Reporting Pay 82 7.13 Split-Shift Pay 83 7.14 Shift-Differential Pay 83 7.15 On-Call Pay 84 7.16 Uniforms, Tools, and Equipment 84 7.17 Meal and Lodging Allowances 85 7.18 Tips 85 7.19 Commissions 86 7.20 Vacation 87 7.21 Reimbursement of Expenses 88 7.22 Paydays 89 7.23 Form of Wage Payment 90 7.24 Deductions from Wages 92 7.25 Statement of Wage Deductions 92 7.26 Final Paycheck 93 Chapter 8. Overtime 96 8.1 Workday 97 8.2 Workweek 97 8.3 Regular Rate 97 8.4 Payment of Overtime on Bonuses or Commissions 99 8.5 Overtime May Be Mandatory 100 8.6 Unauthorized Overtime 100 8.7 Makeup Time 101 8.8 Overtime for Domestic Workers 101 8.9 Alternative Workweeks 102 8.10 White-Collar Overtime Exemptions Generally 103 8.11 The Executive Exemption 106 8.12 The Administrative Exemption 107 8.13 The Professional Exemption 109 8.14 Computer Professionals 111 8.15 Outside Salespersons 112 8.16 Inside Salespersons 112 8.17 Truck Drivers 114 8.18 Bus, Taxi, and Limo Drivers 115 8.19 Employees Covered by a Collective Bargaining Agreement 115 Chapter 9. Meals, Breaks, Pants, and Seats: Other Rights of Employees 116 9.1 Meal Periods 116 9.2 Rest Breaks 117 9.3 Cool-Down Breaks 118 9.4 The Right to Wear Pants to Work 119 9.5 Suitable Seats 119 9.6 Day of Rest 119 9.7 Lactation Breaks 119 9.8 Illiterate Employees 120 9.9 Employees’ Political Activities 120 9.10 Secret Shoppers 120 9.11 Smoke-Free Workplaces 120 9.12 Restrooms 120 9.13 Changing Rooms and Resting Facilities 120 Chapter 10. Employee Privacy Rights 122 10.1 Source of Privacy Rights 122 10.2 Personnel Records 122 10.3 Medical Information 124 10.4 Social Security Numbers 125 10.5 Searches of Employees and Their Possessions 125 10.6 Monitoring Telephone Conversations 126 10.7 Video and Audio Recording of Employees 126 10.8 GPS Tracking 126 10.9 Monitoring of E-mail, Internet Use, and Social Media 127 10.10 Drug and Alcohol Testing 127 10.11 Lawful Off-Duty Conduct 129 10.12 Defamation in the Employment Context 130 Chapter 11. Protecting Trade Secrets 132 11.1 Sale of Business Exception 132 11.2 Out-of-State Noncompete Agreements Not Enforceable in California 133 11.3 Unlawful to Require Employee to Sign a Noncompete Agreement 133 11.4 Lawful Means of Protecting Trade Secrets 133 11.5 Confidentiality Agreements 134 11.6 Hiring Employees of a Competitor 137 Chapter 12. Employment Discrimination 140 12.1 Age 142 12.2 Disability and Medical Condition 142 12.3 Gender 142 12.4 Genetic Information 143 12.5 Marital Status 144 12.6 Military or Veteran Status 144 12.7 National Origin or Ancestry 144 12.8 Race or Color 145 12.9 Religion 146 12.10 Sex 147 12.11 Sexual Orientation 148 12.12 Bona Fide Occupational Qualifications 148 Chapter 13. Harassment 150 13.1 The Legal Standards 150 13.2 Sexual Harassment 151 13.3 Co-Worker Dating and “Love Contracts” 152 13.4 Other Forms of Unlawful Harassment 153 13.5 Failure to Prevent Discrimination and Harassment 154 13.6 Drafting an Effective Policy Against Harassment 155 13.7 Supervisor Training 155 Chapter 14. Accommodating Employees with Disabilities 158 14.1 Who Is Disabled? 158 14.2 “Qualified” 161 14.3 Essential Job Functions 161 14.4 Reasonable Accommodation 162 14.5 “My Disability Made Me Do It!”—Accommodation of Misconduct 166 14.6 The Interactive Process 166 14.7 Direct Threat 168 14.8 Disability Discrimination and Workers’ Compensation 168 14.9 Medical Exams and Inquiries 169 14.10 Wellness Programs 170 Chapter 15. Leaves of Absence 172 15.1 Family and Medical Leave Act/California Family Rights Act Leave 172 15.2 State Disability Insurance Benefits 180 15.3 Paid Family Leave 181 15.4 Pregnancy Disability Leave 182 15.5 Paid Sick Leave 183 15.6 Military Leave 187 15.7 Military Spouse Leave 187 15.8 Jury Duty or Witness Leave 188 15.9 Voting Leave 188 15.10 Leave for Victims of Crime 188 15.11 Leave for Victims of Domestic Violence, Sexual Assault, or Stalking 189 15.12 School Leaves 189 15.13 Volunteer Emergency Responder Leave 190 15.14 Civil Air Patrol Leave 190 15.15 Organ or Bone Marrow Donor Leave 190 15.16 Bereavement Leave 190 Chapter 16. Conducting Workplace Investigations 192 16.1 Legal Reasons for Conducting Careful Investigations of Workplace Misconduct 192 16.2 Initiating the Investigation 193 16.3 Selection of the Investigator 195 16.4 Placing the Accuser and/or the Accused on Paid Leave 195 16.5 Preparation for the Investigation 196 16.6 Conducting Interviews 197 16.7 Resolving Credibility Issues and Reaching a Conclusion 203 16.8 Use of Polygraph During Investigations 204 16.9 Taking Appropriate Corrective Action 204 16.10 Creating and Maintaining an Investigative File 205 Chapter 17. Avoiding Retaliation Claims 208 17.1 What Constitutes Retaliation 208 17.2 Who Can Claim Retaliation 208 17.3 Retaliation in Violation of Laws Against Discrimination and Harassment 208 17.4 Retaliation in Violation of Leave Laws 209 17.5 Retaliation in Violation of Whistle-Blower Laws 209 17.6 Wrongful Termination in Violation of Public Policy 211 17.7 Avoiding Retaliation Claims 211 Chapter 18. Rightful Terminations 214 18.1 Setting Up a Defensible Termination 214 18.2 Severance Agreements 216 18.3 Reductions in Force 218 18.4 WARN Acts 218 18.5 Unemployment Insurance 221 Chapter 19. Unions and Labor Relations 224 19.1 Coverage of the NLRA 224 19.2 Employees’ Rights Under the NLRA 224 19.3 Unfair Labor Practices Under the NLRA 225 19.4 The Process by Which Employees Select a Union as Their Bargaining Representative 226 19.5 Collective Bargaining 229 19.6 Strikes and Lockouts 230 19.7 Decertification and Withdrawal of Recognition 232 Appendix of Cited Cases 234 Index 236 About the Author 252 Additional SHRM-Published Books 254 This text is written for those who must contend with employment law in California as part of their work. The book's approach is practical. There is no lengthy analysis of court decisions, and there are no footnotes. This book is grounded in the law as it is found in statutes, regulations, and case law, but its focus is on how the law works in the real world.