With the New Year, new legislative updates go into effect in California. Below is a summary of some of the newly enacted legislative updates for California employers in 2008.
New Legislative Updates
1. Computer Professional Exemption (SB 929)
Effective January 1, 2008, the required hourly rate for individuals classified as exempt under California’s Computer Professionals’ exemption will be reduced from $49.77 to $36.00 per hour. This amendment to section 515.5 of the Labor Code decreases the hourly rate for those classified as exempt pursuant to the computer professionals exemption.
2. California Minimum Wage
California’s current minimum wage rate of $7.50 will rise to $8.00 an hour for employees of all industries. Beginning January 1, 2008, all employers must pay non-exempt employees wages no less than $8.00 an hour for all hours worked. This will also increase the minimum salary requirements for employees classified as exempt under the administrative and executive exemptions.
3. Pharmacists’ Alternative Workweek Schedule (SB 812)
Pharmacists who work in the mercantile industry, under Wage Order 7 of the Industrial Commissions, will be allowed to adopt an alternative workweek schedule similar to that currently permitted by Wage Order 4. Thus, pursuant to Labor Code Section 1186.5, the pharmacists will be permitted to adopt an alternative workweek schedule, without the restrictions of 2 consecutive days off, as mandated by Wage Order 7.
4. Military Leave for Spouses (AB 392)
A new amendment to the California Military and Veteran’s Code stipulates that employers of more than 25 employees must provide each employee with up to 10 days of unpaid leave when his or her spouse is on leave from military duty. To qualify for spousal military leave, an employee must work an average of at least 20 hours per week and have a spouse or registered domestic partner in the United States Armed Forces, Army Reserves, or the National Guard and on active duty in an area of military conflict. The employee must give his or her employer at least two business days notice of the requested leave and provide written documentation to certify that his or her spouse is on deployment leave.
5. San Francisco Paid Sick Leave
San Francisco employers should be mindful of the City sponsored Health Care Security Ordinance (“HCSO”), where under Chapter 12W of the San Francisco Administrative Code, employers are required to provide paid sick leave to each employee who performs work in San Francisco, including all temporary and part-time employees. This ordinance is effective January 1, 2008 for all employers with 50 or more employees, and on April 1, 2008 for all non-profit businesses with 20-29 employees. Sick leave may be used for an employee’s personal medical problems as well as to provide care to a family member or other designated person. San Francisco employees earn one hour of paid sick leave for every 30 hours worked. Those employees working for employers with less than 10 employees may not accrue more than 40 hours of paid sick leave at any one time. All other employees may accrue up to 72 hours of sick leave at any time. Accrued sick leave carries over each year.
6. Workers’ Compensation & Disability Leave Benefits (AB 338)
Labor Code 4656 has been amended to increase the period of time during which an injured employee can receive aggregate disability benefits. Therefore, the two-year window of eligibility for disability payments is now increased up to five-years from the date of the injury. This amendment applies to injuries occurring on or after January 1, 2008.
7. Employee Notice of Earned Income Credit Rights (AB 650)
Under the federal income tax laws, certain low-income individuals who have earned income and meet other requirements may be eligible for a refundable earned income tax credit. Beginning on January 1, 2008, employers are required to notify all employees of their potential right to elect an Earned Income Tax Credit on their federal tax returns.
8. Limitation of Use of Social Security Number on Itemized Pay Statements (SB 1618)
Effective January 1, 2008, a new amendment to Labor Code 226 requires all employers to use no more than the last four digits of the employee’s social security number on all employee itemized statements. Alternatively, the code permits employers to use and employee identification number instead.
9. New Form 1-9
On November 26, 2007, the U.S. Citizenship and Immigration Services announced that employers must implement and use a new Form I-9 no later than December 26, 2007. The revised Form I-9 is mandatory for all new hires and all employee re-verifications. The new forms are available to download at www.uscis.gov/files/form/i-9.pdf.
10. National Guard Qualification for Public Employees Retirement System (SB 14)
Senate Bill 14 allows officers and enlisted members of the National Guard of California to now qualify for membership in the California Public Employees Retirement System (PERS).
11. Cell Phone Usage Requirements While Driving (SB 1613)
Beginning on July 1, 2008, cell phone usage in moving vehicles is prohibited unless the driver is using a hands free devise. Drivers of commercial vehicles are allowed to use push-to-talk phones until July 1, 2011.
12. Standard Mileage Rates
Effective January 1, 2008, the optional standard mileage rates issued by the Internal Revenue Service used to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes will increase to the following: 1) 50.5 cents per mile for business miles; 2) 19 cents per mile for medical or moving purposes; 3) 14 cents per mile for charitable purposes.
Top Five Quick Fixes To Start the Year Off Right!
- Review and revise existing handbooks and policies to ensure compliance with the new regulations.
- Update new-hire paperwork and employment forms to ensure compliance with the new updates.
- Update employment posters and ensure 2008 required posters are posted.
- Evaluate and audit employee exemptions in light of new changes to the minimum wage and the change in the hourly rate for computer professionals.
- Train managers and supervisors to ensure proper compliance with these and other relevant employment law regulations.