Labor and Employment

Goal

Protect employers’ rights to organize, direct and manage their companies’ employees in an efficient, safe and productive manner.

Issue Summaries

Assembly Bill 5

Position: The current workforce values flexibility, which is why the Dynamex decision is so detrimental to millions of California workers. Failing to further amend AB 5 to provide additional industry exemptions and broaden the business-to-business exemption has the potential to eliminate the vast majority of independent contractors in California.

Although the CalChamber appreciates the recognition in AB 5 that the Dynamex decision is not one-size-fits-all and agrees the professions identified should be exempted under AB 5, the Legislature should not stop with selecting just a few professions and not others that are similarly situated. What’s needed is a more progressive and holistic approach to applying Dynamex that reflects today’s modern workforce.
Assembly Bill 5

Paid Family Leave

Position: The CalChamber certainly supports work/family balance; however, any new proposed leave of absence for employees should be considered in light of the existing leaves of absence employers already are required to provide in California. Although such leaves certainly do not address every potential personal situation that may arise, this does not mean that additional, statutory protected leaves of absence are necessary in California.

Rather, the CalChamber believes that such individual issues are more appropriately addressed between an employer and employee, taking into consideration the needs of the employee and the workforce demands of the employer. California cannot jeopardize the growth of the business community by burdening employers with any additional, mandatory leaves of absence that the employer must accommodate regardless of its existing business and workforce needs.

Finally, adding a private right of action as the enforcement mechanism for each leave of absence simply increases litigation, adds unnecessary costs to employers and primarily benefits trial attorneys instead of the employee.
Paid Family Leave

Paid Sick Leave

Position: While the CalChamber appreciates and understands the need for employees to stay home from work while they are sick, expanding another leave mandate that primarily harms small employers is concerning. Such an expansion also is challenging without clarifying amendments to the Act and preemption of local ordinances. The Act is already a huge financial and compliance burden on employers. Unscheduled absenteeism costs roughly $3,600 per year for each hourly employee.

Given the cumulative costs and existing protected leaves of absence with which California employers already are struggling, California should refrain from mandating additional sick days and instead allow employers and employees to manage the leave of absence policies as needed to accommodate both the employee’s and employer’s needs.
Paid Sick Leave

Private Attorneys General Act

Position: PAGA is a primary concern of the employer community due to the financial leverage it provides to plaintiffs’ attorneys to pursue claims for minor violations of the California Labor Code. Questionable litigation that results in significant monetary settlements wherein the plaintiffs’ attorneys retain a majority of the money for fees and employees are provided a minimal amount is not fulfilling the stated intent of PAGA.

The CalChamber is supportive of any efforts to reform PAGA to ensure the goals of labor law enforcement are satisfied, and that it is not used as a vehicle to enrich trial attorneys.
Private Attorneys General Act

Workplace Flexibility

Position: California labor laws simply do not allow employers to accommodate individual employee requests for flexible work arrangements. Employers should be able to provide their employees more flexibility and negotiate through a written agreement, revocable by either party, the daily and/or weekly schedules that satisfy the needs of both employee and employer. Moreover, if a nonexempt employee wants to skip a 30-minute meal period and eat lunch on-duty in order to leave early, why should an employer be put in the awful position of telling the employee “no”?

California lawmakers should focus on policies that allow individuals the option to work as independent contractors and improve workplace flexibility for employees, while alleviating the threat of costly litigation for employers for accommodating workers’ desired schedules.
Workplace Flexibility

Defended Employers Against Unwarranted Litigation in 2018:

• Won veto of legislation that would have banned settlement agreements and arbitration agreements for labor and employment claims (AB 3080);
• Blocked a bill banning the use of arbitration agreements for small businesses seeking financial investors (AB 2527).
• Secured amendments removing new stand-alone private right of action for failure to prevent harassment or discrimination (SB 1300).
• Stopped bill exposing employers to costly litigation related to medical marijuana in the workplace (AB 2069).

Prevented passage in 2018 of proposal creating unworkable requirements for providing hotel worker panic buttons (AB 1761); and stopped bills imposing another layer of wage statement penalties (AB 2613).

Sponsored job creating legislation in 2018 that protects employers/employees in sexual harassment cases. AB 2770 will ensure sexual harassment victims and employers aren’t sued for defamation for simply reporting and investigating harassment.

Supported Workable Balance for Employee Accommodations in 2018. Secured amendments to bill signed into law that includes a hardship exemption in its requirements for providing lactation accommodations to employees (AB 1976) and backed veto of a second bill containing significant changes in requirements and penalties (SB 937).

Blocked an effort in 2017 to eliminate worker and employer flexibility with an unfair scheduling mandate (AB 5); won veto of new data collection mandate on lawful wage differentials (AB 1209).

Defeated a proposal in 2016 discriminating against arbitration agreements in consumer contracts (AB 2667) and in employment agreements (AB 2879).

Derailed attempts in 2016 to permit price-setting by independent contractors (AB 1727); exposing employers to a private right of action related to their Injury and Illness Prevention Program (AB 2895); and eliminating worker and employer flexibility with a mandated scheduling requirement (SB 878).

Defended employers against unwarranted litigation by securing amendments in 2016 to state-run retirement savings program to limit employer liability (SB 1234).

Halting job killer legislation in 2015 that would have increased labor costs, including a one-size-fits all scheduling mandate (AB 357); automatic minimum wage increase (SB 3); significant expansion of the California Family Rights Act (SB 406); and significant increase in workers’ compensation costs (SB 563).

Securing approval of urgency legislation giving employers a limited opportunity to cure technical violations in an itemized wage statement before being subject to costly and devastating litigation, so an employer can devote its financial resources to expanding its workforce (AB 1506 of 2015).

Reducing Unnecessary Requirements in 2015:

• Backed bipartisan state legislation creating additional conformity between state and federal tax law, thereby easing accounting, recordkeeping and filing requirements for businesses (AB 154).
• Supported veto of plan to create expansive new notification requirements from employers to individuals who are not employees in order to solve a narrow concern with variance applications for elevators (AB 578).
• Won defeat of proposal to mandate double pay for almost all employees who worked on Thanksgiving (AB 67).

Clarifying Employer Responsibilities in 2015:

• Worked extensively with author to obtain employer-friendly amendments to clean-up legislation to the 2014 paid sick leave bill, including grandfathering in paid time off policies in effect before the new law, options for different sick leave accrual methods and options for calculating the appropriate rate of pay for paid sick leave (AB 304 of 2015).
• Negotiated amendments to legislation clarifying basis for an employee to take leave under existing school activities leave law (SB 579 of 2015).
• Secured substantive amendments to wage theft bill to alleviate concerns of employers trying to comply with the law (SB 588 of 2015).
• Worked with author to make bill requiring electronic filing of unemployment insurance tax returns less onerous than originally proposed (AB 1245 of 2015).

Winning Safe Harbor for Employers with Gender Equity Pay Bill: Negotiated legislation placing in statute what existing case law requires employers to do, including safe harbor language so that employers can avoid unnecessary litigation when there are legitimate reasons for pay differences. (SB 358 of 2015)

Stopped costly workplace mandates in 2014, including minimum wage increases linked to the Consumer Price Index (SB 935); increased workers’ compensation penalties and litigation (AB 2604); and expansion of discrimination litigation (SB 404).

Stopped economic development barriers in 2014, such as allowing liens on an employer’s property based upon alleged-yet-unproven wage claims (AB 2416).

Supported legislation signed into law in 2014 to clarify that employers don’t violate state law regarding discrimination against employees with driver licenses that note they are not documented citizens if the employer must take action in compliance with immigration law (AB 1660).

Supported legislation in 2014 easing compliance by allowing email or telephone reporting of work-related incident subject to immediate notification of Cal/OSHA (AB 326).

Defeated costly workplace mandates in 2012, such as a bill driving up the cost of commodities to consumers by removing the overtime exemption allowed for agricultural employers (AB 1313); an automatic minimum wage increase (AB 1439); expanded leave requirements (AB 2039); and a targeted burden on companies with call centers (AB 2217). Also secured amendments to remove the threat of frivolous litigation for inquiring into an applicant’s most recent employment background (AB 1450). Advocated veto of bill increasing the cost of food by creating unprecedented and excessive consequences for perceived and actual violations of heat illness prevention regulations (AB 2346).

Supported legislation signed into law in 2012 that preserves existing employer rights to conduct workplace investigations with regard to personal social media (AB 1844).

Negotiated amendments in 2012 to bills that would otherwise have exposed employers to new wage-and-hour litigation or greater likelihood of penalties for good faith administrative errors on wage statements (AB 1744, SB 1255).

Supported veto in 2012 of proposed requirement for individuals and families who hire “domestic work employees” to comply with onerous wage-and-hour mandates that even sophisticated businesses struggle to satisfy (AB 889).