Governor Gavin Newsom recently signed a number of new legislation that could potentially impact employees in California this year. These laws range from creating additional penalties wages reported late or incorrectly, an expansion of leaves related to organ donation and paid family leave, and prohibition of discrimination based on one’s hairstyle. Below are just a few of the most substantial changes in employment law:

AB 5: ABC Test for Independent Contractors

Creating a test for determining whether a worker has been properly classified as an independent contractor instead of an employee. Under this test, a worker may only be classified as an independent contractor if:

  • The worker is free from control and direction in the performance of services; and
    • The worker is performing work outside the usual course of the business of the hiring company; and
    • The worker is customarily engaged in an independently established trade, occupation, or business.

SB 707: Breaches in Arbitration Agreements

If an employer fails to pay the required fees to initiate/continue arbitration within 30 days of its due date, the employer will be deemed to have materially breached the agreement. The affected employee may either withdraw from the arbitration and file the claim in court or rather compel arbitration under the contract. The court will then be required to impose a monetary sanction against the drafting party who materially breaches the agreement.

SB 83: Extension of Paid Family Benefits

For claims that start on/after July 1, 2020, California’s Paid Family Leave (“PFL) benefits will extend from six weeks to eight. Employees eligible to take leave through paid sick leave or FMLA/CFRA may then apply for wage replacement benefits through PFL. The bill further requires Governor Newsom to submit a proposal for increasing PFL duration to six months by 2021-2022. Nonetheless, this proposal will be limited to instances related to baby bonding and six months will be the total duration for two parents who claim PFL benefits.

AB 1804: Immediate Reporting of Serious Occupational Injuries

Employers must now report serious injuries occurring on the job, illness, or death immediately to the California Division of Occupational Safety and Health. Until the online portal becomes available, this reporting must be conducted by telephone or email. Noncompliance brings a penalty of $5,000.