The California Legislature began its summer recess at the end of the day on Wednesday, July 3. It will return to work on Monday, August 5, for its final push towards adjournment on Friday the 13th of September. The following outlines major California legislative developments, as well as a summary of significant pending bills affecting California private employers.

Highlights of Major Recent Developments

The California State Assembly Democrats lost their two-thirds majority June 30 when a Democratic Assembly member elected to the Los Angeles City Council resigned his Assembly seat.

The minimum wage increase (AB 10), now pending in the state Senate, was amended on June 19 to delete its automatic increase feature. The bill is likely to pass the Legislature.

Probably this session’s most heavily contested piece of workplace legislation failed on June 27 to get the two-thirds majority needed to pass the Assembly as an urgency bill. AB 880 would have assessed penalties against employers of 500 employees or more whose employees choose to enroll in the Medi-Cal program. With the Obama administration’s July 2 announcement to defer for one year the imposition of employer-mandated health insurance, the bill will probably return in 2014 – if not before.¹

The Senate-passed a bill (SB 400) that would extend current protections required of employers for employees who are victims of domestic violence and sexual assault to employees who are known or suspected victims of stalking, and require reasonable accommodations, which could be any of more than a dozen possible accommodations listed in the current version of the bill. The bill is at its last committee stop before coming up for final passage by the Assembly.

For employers who have unionized employees, another bill of interest would create a new evidentiary privilege, making confidential most communications between a union agent and union member (AB 729). This bill has passed the Assembly and the Senate Judiciary Committee.

Unfair immigration-related practices could be the subject of heavy fines and private enforcement actions under proposals contained in AB 263.

Two bills would create additional protected categories under the Fair Employment and Housing Act (FEHA) for familial status (SB 404) and military and veteran status (AB 556).

A bill (SB 292) declaring that a person prosecuting a claim of sexual harassment need not prove that the sexually harassing conduct was motivated by sexual desire has passed the Legislature and will be submitted to Governor Jerry Brown for approval.

The last day for any bill to be passed is September 13. Any bill passed by the Legislature on or before September 13 and in the Governor’s possession after September 13 must be signed or vetoed by October 13.

Bill Summary and Status

Following is a summary of significant bills affecting California private employers² now pending in the Legislature, and their status in the legislative process.

AB 10 (amended June 19) would amend section 1182.12 of the California Labor Code to increase the minimum wage on and after January 1, 2014, to not less than $8.25 per hour. The bill would further increase the minimum wage, on and after January 1, 2015, to not less than $8.75 per hour; on and after January 1, 2016, to not less than $9.25 per hour; on and after January 1, 2017, to not less than $9.50 per hour; and on and after January 1, 2018, to not less than $10 per hour. Passed Assembly and Senate Labor and Industrial Relations; pending in Senate Appropriations.

AB 11 (amended January 28) would amend Section 230.4 of the state Labor Code. Existing law requires an employer employing 50 or more employees to permit an employee who is a volunteer firefighter to take temporary leaves of absence, not to exceed an aggregate of 14 days per calendar year, for the purpose of engaging in fire or law enforcement training. This bill would revise these provisions to require those employers to permit an employee who performs emergency duty as a volunteer firefighter, reserve peace officer, or as emergency rescue personnel, as defined, to take the leave of absence described above for the purpose of engaging in fire, law enforcement, or emergency rescue training. Passed Assembly and Senate Labor and Industrial Relations; Senate passage pending.

AB 155 (last amended May 29) would require the employee to elect to inspect or copy, receive a copy of, or any combination thereof, his or her employment records and would require the employer to comply with that election. The bill would entitle a former employee terminated for workplace violence or harassment only to receive a copy of the records, without any charge by the employer. The bill would define “actual cost of reproduction” to mean only the per page cost to the employer for the physical duplication of the records. Passed Assembly; pending in Senate Labor and Industrial Relations. AB 263 (last amended May 24), which would, among other things, add a new section of the California Labor Code prohibiting specified "unfair immigration-related practices," increase civil penalties to as high as $10,000 per employee per violation for any retaliation against an employee, authorize a private right of action for equitable relief, damages, and penalties, and require a court to order the appropriate government agencies to suspend or revoke an offending employer’s business license. Passed Assembly and Senate Labor and Industrial Relations and Judiciary; pending in Senate Appropriations.

AB 442 would expand the civil penalty and the payment of restitution of wages to the employee for a Labor Commissioner citation against an employer to also subject the employer to payment of liquidated damages to the employee. Passed Assembly; scheduled for hearing August 12 in Senate Labor and Industrial Relations.

AB 556 (last amended April 11) would add the protected category of “military and veteran status” to the FEHA’s employment provisions and related provisions. Passed Assembly and Senate Judiciary; Senate passage pending.

AB 729 (last amended June 10) amends sections 912 and 917, and adds sections 1048-1048.1, of the state Labor Code to provide that a union agent, as defined, and a represented employee or represented former employee, have a privilege to refuse to disclose any confidential communication between the employee or former employee and the union agent while the union agent was acting in his or her representative capacity, except as specified. The bill would provide that, in most instances, a represented employee or represented former employee also has a privilege to prevent another person from disclosing a privileged communication. The bill would further provide that this privilege may be waived in accordance with existing law, and does not apply in criminal proceedings. Bill source: California Labor Federation, AFL-CIO. Passed Assembly and Senate Judiciary.

AB 880 (last amended May 28) would require a large employer (500 or more employees) to pay the Employment Development Department an employer responsibility penalty for each covered employee enrolled in Medi-Cal based on the average cost of coverage provided by large employers to their employees, including both the employer’s and employee’s share of the premiums. Failed Assembly passage June 27 (46-27, 53 votes required for passage as urgency measure).

AB 1383 would amend section 1205 of the California Labor Code to establish that no provision of the Labor Code shall be deemed to restrict the exercise of local police powers in a more stringent manner. Passed Assembly; pending in Senate Labor and Industrial Relations.

AB 1386 would amend California Labor Code section 98.2 to require that the amount due under a Labor Commissioner order, decision, or award that becomes final and has become a Superior Court order shall be a lien on the employer’s personal and real property, as specified, and would require the county recorder to record and index the order as a mortgage on real estate and to file and index the order as a security interest. Passed Assembly; Senate passage pending.

AB 1387 (amended April 18) would amend section 2055 and repeal section 2067 of the California Labor Code to increase the car wash employer’s bond requirement amount from $15,000 to $150,000, but would exempt an employer from that requirement if the employer has a collective bargaining agreement in place that meets specified criteria, and would delete the existing sunset date for the statute governing car washes, thus extending those provisions indefinitely. Passed Assembly and Senate Labor and Industrial Relations; pending in Senate Appropriations.

SB 168 (amended April 8) would add section 1698.9 to the Labor Code to make a successor farm labor contractor liable for wages and penalties owed by a predecessor farm labor contractor. Passed Senate and Assembly Labor and Employment; pending in Assembly Appropriations.

SB 292 (amended April 2) would amend section 12940 of the Government Act (California Fair Employment and Housing) to specify, for purposes of the definition of sexual harassment, that sexually harassing conduct need not be motivated by sexual desire; intent of bill is to overrule what the bill’s author suggests is the outlier holding in Kelley v. Conco Companies (2011) 196 Cal.App.4th 191, that a plaintiff in a same-sex harassment case must prove that the harasser harbored a sexual desire for the plaintiff in order to survive summary judgment. The bill received no negative votes in the committees or in either house of the Legislature. Sponsor: California Employment Lawyers Association. Passed Senate and Assembly; enrollment pending.

SB 390 (amended June 25) would amend California Labor Code section 227 to make it a crime for an employer to fail to remit withholdings from an employee’s wages that were made pursuant to state, local, or federal law; and would prescribe how recovered withholdings or court-imposed restitution, if any, are to be forwarded or paid. Passed Senate and Assembly Labor and Employment; pending in Assembly Appropriations.

SB 400 (last amended June 27) would amend sections 230 and 230.1 of the California Labor Code to extend the protections available to persons in FEHA-protected categories to victims of stalking; prohibit an employer from discharging or in any manner discriminating or retaliating against an employee because of the employee’s known status as a victim of domestic violence, sexual assault, or stalking; require the employer to provide reasonable accommodations for such a victim; create a private right of action for an aggrieved employee to seek enforcement of those victim status protection and reasonable accommodation provisions; and permit the recovery of reasonable attorney’s fees by a prevailing employee only. Passed Senate and Assembly Labor and Employment; pending in Assembly Appropriations.

SB 404 (last amended July 3) would amend sections 12920, 12921, 12926, 12940, and 12955.2 of the state’s Government Code to add “familial status," to the FEHA as an additional protected status. Cosponsors: California Employment Lawyers Association, Center for Worklife Law, Equal Rights Advocates. Passed Senate and Assembly Labor and Employment; pending in Assembly Appropriations.

SB 435 (amended April 16) would amend section 226.7 of the California Labor Code to require employees of piece rate workers to pay those employees for any meal or rest breaks, or recovery periods, and set the rate of pay for rest and recovery periods for piece rate workers. Passed Senate; to be heard August 14 in Assembly Labor and Employment.

SB 462 would amend section 218.5 of the California Labor Code to authorize the award of attorney's fees and costs in an action brought for the non-payment of wages, fringe benefits or health and welfare pension fund contributions, where the prevailing party is not the employee, contingent on a finding by a trial court that the employee brought the court action in bad faith. Sponsor: California Employment Lawyers Association. Passed Senate and Assembly Judiciary; Assembly passage pending.

SB 556 (last amended July 1) would add section 3273 to the state’s Civil Code to prohibit a person, firm, corporation, or association that is a nongovernmental entity and contracts to perform labor or services for a public entity from displaying on a vehicle or uniform a seal, emblem, insignia, trade, brand name, or any other term, symbol, or content that reasonably could be interpreted as implying that the labor or services are being provided by employees of the public agency, unless the vehicle or uniform conspicuously displays a disclosure. Co-sponsors: California Labor Federation; California Professional Firefighters. Passed Senate and Assembly Judiciar; Assembly passage pending.

SB 648 (last amended May 7) would amend and add sections of various codes to, among other actions, extend the same prohibitions on the smoking of tobacco products in workplaces to electronic cigarettes. Passed Senate; hearing August 7 in Assembly Governmental Organization.

SB 655 (last amended April 15) would amend sections 12940 and 12965 of the state’s Government Code to provide that in a claim of an unlawful practice under the FEHA, the employee prevails if the employee has proven that a protected characteristic was a substantial factor in the adverse employment action; if an employer proves as an affirmative defense that it would have taken the same adverse action against an employee based on lawful reasons, the remedies available to the employee would be limited as provided. The measure would also provide for a specified civil penalty, and for attorney’s and expert’s fees to be paid by an employer who violates these provisions. The bill purports to codify the California Supreme Court's decision in Harris v. City of Santa Monica (2013) 56 Cal.4th 203, on mixed motives in discrimination cases. Passed Senate; to be heard August 13 in Assembly Judiciary.

SB 770 would amend sections 2708, 3300, 3301, 3302, and 3303 of the Unemployment Insurance Code to expand the scope of the family temporary disability program to include time off to care for a seriously ill grandparent, grandchild, sibling, or parent-in-law. Sponsor: Legal Aid Society-Employment Law Center. Passed Senate; to be heard August 7 in Assembly Insurance.

SB 776 (amended April 15) would amend section 1773.1 of the California Labor Code to modify existing law concerning permissible credits employers may take against the obligation to pay the general prevailing rate of per diem wages for prevailing wage payments, and would prohibit credit from being granted for employer payments made to monitor and enforce laws related to public works if those payments are not required by a collective bargaining agreement. Passed Senate and Assembly Labor and Employment; pending in Assembly Appropriations.