As 2019 comes to a close, here is a look ahead to some of the legislation going into effect on January 1, 2020, that affects employers in California.

Independent Contractors

Assembly Bill 5 codifies and clarifies the California Supreme Court’s 2018 Dynamex Operations West, Inc. v. Superior Court of Los Angeles County, 4 Cal. 5th 903. In Dynamex, the Court adopted the “ABC Test” for determining whether an individual should be classified as an independent contractor. Under the ABC Test, to establish that an individual is, in fact, an independent contractor, an employer must prove that the person: (A) is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact; (B) performs work that is outside the usual course of the hiring entity’s business; and (C) is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.

Arbitration Agreements

Assembly Bill 51 makes it unlawful for any person to require a job applicant or employee to waive California Fair Employment & Housing Act (FEHA) or Labor Code-based rights as a condition of new or ongoing employment or receiving any employment-related benefit — that is, if the Federal Arbitration Act (FAA) does not apply. Employers are prohibited from threatening, retaliating, discriminating against, or terminating any job applicant or employee because of their refusal to consent to the waiver of any FEHA or Labor Code-based rights. Moreover, under Senate Bill 707, companies that fail to pay required arbitration fees within 30 days after the due date are in material breach of their arbitration agreements.

Protective Hairstyles

Senate Bill 188 introduced the CROWN Act (Creating a Respectful and Open Workspace for Natural Hair), which clarifies the definition of race for the workplace and educational institutions to include hair texture and protective hairstyles. It also defines protective hairstyles.

Lactation Accommodations

Senate Bill 142 expands on existing California Labor Code requirements for employee lactation accommodations and adopts significant new consequences to employers for non-compliance. The law requires the following features for private lactation spaces: they be safe, clean, and free of hazardous materials; contain a surface to place a breast pump and personal items; contain a place to sit and have access to electricity or alternative devices (e.g., extension cords or charging stations) needed to operate a breast pump. SB 142 also requires employers to provide access to a sink with running water and a refrigerator (or cooler) to store milk, in close proximity to the employee’s workspace. Furthermore, employers must develop and implement a lactation policy that includes a statement concerning an employee’s right to request lactation accommodation.

Organ Donation

Assembly Bill 1223 extends the amount of leave an organ donor may take. In addition to paid leave already required under California law, private employers must provide a maximum of an additional 30 business days of unpaid leave.

Minimum Wage Increases

California’s stair-step minimum wage regulation raises the minimum wage again on January 1, 2020. For employers with up to 25 employees, the statewide minimum wage will increase to $12.00 per hour; employers with 26+ employees must pay at least $13.00 per hour.

This raise also affects the minimum salary requirements for exempt employees. For employers with up to 25 employees, the minimum salary requirement will increase to $49,920; for employers with 26+ employees, the minimum salary requirement will increase to $54,080.

Applicable local minimum wage ordinances may exceed the minimum wage statewide. Employers must comply with the higher rate.