California Must Fix Labor Laws to Reflect Shift to Remote and Hybrid Work Arrangements

Any question about whether remote work would continue after pandemic-related shutdowns ended has been answered: work from home is here to stay.

The fact that remote work has become a permanent feature of workplace culture was recently confirmed by data from the U.S. Census Bureau. That data was cited in news reports appearing in the San Francisco Chronicle and California Healthline earlier this week.

Interestingly, what is also clear about the reality of remote work is that California policies favor some workers over others. Obviously, many essential jobs simply cannot be performed remotely including, among others, those in the construction, health care, hospitality, retail, production, manufacturing, agricultural, warehouse, and grocery sectors. However, other hourly workers who can adequately perform their responsibilities remotely are unable to do so due to obstacles created by California’s overly complex labor laws. These outdated, inflexible wage and hour laws never contemplated today’s remote work environment.

The reality today is this: even if both an employer and an employee mutually agree on a remote work option, employers face a minefield of litigation exposure over unintended record-keeping oversights or the inability to adequately “police” employees to be sure they are complying with a huge number of regulations.

For example, California’s labor laws mandate when and for how long hourly employees must take breaks. Although an employer technically is not required to ensure that employees take those breaks on time, in reality employers must monitor breaks to avoid liability. California law also is unique in that it provides for daily overtime after 8 hours. Having employees work from home where their supervisors cannot see them with constant access to work emails and calls makes it difficult to ensure employees are not working unapproved overtime or working off the clock.

A working parent who would rather work 10 hours Monday through Thursday to take Friday off for family obligations cannot do so unless the employer is willing to pay the overtime, which many businesses cannot afford right now, or two-thirds of their “work unit” agrees through a secret ballot process to implement that schedule for the entire unit.

Liability for unpaid overtime is costly. An employee who is owed even just 5 minutes of overtime pay also can sue for waiting time penalties (for up to 30 days of pay), penalties for failure to provide accurate wage statements, and penalties under the Private Attorneys General Act.

What makes these particular laws so difficult to comply with is that employers have extremely limited control over employees working at home. A supervisor cannot physically see when an employee is taking a break or if they are working unauthorized overtime or while off the clock.

Laws affecting remote work are scattered throughout various sections of the Labor Code, Government Code, and in 17 industry Wage Orders and local ordinances. The laws do not contain any exceptions for remote work and provide no guidance as to how the requirements are to be applied to employees who are not working in a traditional work setting. Any violation, whether intentional or not, tempts litigation.

Over the last decade, there have been repeated attempts to pass legislation to allow for more worker flexibility, such as allowing employees to enter into individual alternative workweek schedules. These bills always have been defeated, usually not making it past the first committee hearing. It is time to increase flexibility in work schedules. This will benefit workers and allow employers to retain qualified workers who want flexible work arrangements.

The necessity of offering remote or hybrid work arrangements is a reality for many California companies. Policy makers must ensure that California businesses can remain competitive with their counterparts in other states. It is time for the Legislature to remove obstacles that are unfairly affecting hourly workers who can work remotely.

Jennifer Barrera is president and CEO of the California Chamber of Commerce.

Jennifer Barrera
Jennifer Barrera took over as president and chief executive officer of the California Chamber of Commerce on October 1, 2021. Previously, she oversaw the development and implementation of policy and strategy as executive vice president and represented the CalChamber on legal reform issues. She led CalChamber advocacy on labor and employment and taxation from September 2010 through the end of 2017. As senior policy advocate in 2017, she worked with the executive vice president in developing policy strategy. Before joining the CalChamber, she worked at a statewide law firm that specializes in labor/employment defense. Barrera earned a B.A. in English from California State University, Bakersfield, and a J.D. with high honors from California Western School of Law. See full bio.