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New COVID-19 Regulations

In addition to the new laws I described in my last blog, there are some new regulations related specifically to COVID-19.

Cal-OSHA COVID-19 Reporting Requirements

AB 685, effective January 1, 2021, requires that within one business day of being notified by an employee of potential COVID-19 exposure, an employer must provide written notice to all employees of the following:

Potential exposure
Information regarding all COVID-19 related benefits available under federal, state and local laws
Disinfection and safety plan the employer will implement per CDC guidelines

Employers must maintain records of notifications for at least three years.

Workers Compensation

SB 1159 creates “rebuttable presumption” that, in certain circumstances, illness or death from COVID-19 is work-related. This rebuttable presumption remains in place until January 1, 2023, and applies to all employees who:

Work for a company with five or more employees
Test positive during any COVID-19 outbreak at the place of employment

Workers Compensation now also has a new reporting requirement that employers must report to their Claims Administrator within three days that an employee has tested positive for COVID-19.

An employer may dispute the presumption by providing evidence of measures it took to reduce potential transmission of the disease or the employee’s nonoccupational risks of COVID-19 infection.

Testing and Vaccines

Employers may require, as part of their COVID-19 health and safety protocols, that employees who work onsite be periodically tested for COVID-19, as long as the employer pays for the test and adheres to HIPAA and privacy law.

Employers may not, however, require antibody testing.

As for vaccines, the rules on this are not clear yet, so the best thing to do is consult your legal counsel.

COVID-19 Prevention Plan

As of November 30, 2020 Cal-OSHA has required employers to have a written COVID-19 Prevention Plan. This can be a stand-alone document or integrated into the employer’s Injury and Illness Prevention Program.

The COVID-19 Prevention Plan applies to all employees except: 1) When there is only one employee who does not come in contact with other persons; 2) Employees working from home; 3) Employees already covered by the aerosol transmission standard.

The written COVID-19 Prevention Plan must include the following:

A system for communication
Identification and evaluation of COVID-19 hazards
Investigating and responding to COVID-19 cases in the workplace
Correction of COVID-19 hazards
Training and instruction
Physical distancing
Face coverings
Other engineering controls, administrative controls, and personal protective equipment (PPE)
Reporting, recordkeeping, and access
Exclusion of COVID-19 cases
Return to work criteria

Cal/OSHA has a model COVID-19 Prevention Plan on its website as well as FAQs and other helpful information for employers about COVID-19.

As a reminder, we have an employer resource page that has links to a variety of sites that deal specifically with COVID-19 information. Here’s the link again for your reference Connect to HR Employer Resources.

Also, I spoke to my colleague, Mary Hiland, Ph.D earlier this year on the topic of health and safety in the workplace. Click here for a recap of the interview.

Please reach out if you need help updating your IIPP or have questions about implementing these new regulations.

New Employment Laws for 2021

A new year is just around the corner! No doubt we will all be happy to put 2020 behind us!

As with every new year, there are a number of new employment laws and regulations. This is the first of two articles to inform you about those laws.

Expanded California Family Rights Act (CFRA)

The California Family Rights Act currently requires employers with 50 or more employees to provide eligible employees with 12 weeks of unpaid leave in a 12-month period to 1) recover from a serious health condition; 2) care for a family member with a serious health condition; or 3) bond with their child.

SB 1383 expands CFRA coverage, effective January 1, 2021, as follows:

The law now applies to employers with 5 or more employees
It eliminates the employee count within a 75-mile radius requirement
The definition of covered family members is expanded from child, parent, spouse or domestic partner to include grandparent, grandchild and siblings
“Child” is no longer limited to children under age 18
The leave cap of 12 weeks for new child bonding for two parents employed by the same employer has been eliminated
The key employee exception is now repealed
The law repeals the New Parent Leave Act for employers with 20 to 49 employees because the new CFRA will provide this coverage

A CFRA and Federal Family Medical Leave (FMLA) may run concurrently or separately depending on whether the CFRA leave is covered by FMLA. If it’s not, an eligible employee may take both – 12 weeks for CFRA and an additional 12 weeks for FMLA. Be sure to update your policies to reflect the changes.

Deadline for CA Sexual Harassment Prevention Training

SB 778 extends the deadline for CA anti-harassment training to January 1, 2021 for employers with fewer than 50 workers/contract employees.

All employers must provide two hours of training to supervisors and one hour of training to non-supervisors. Training must be repeated every two years and new employees/supervisors must be trained within their first six months. Other requirements include:

Supervisor training must be “live,” and interactive, e.g., via a webinar, with the opportunity for participants to ask questions, have them answered and seek guidance and assistance. Supervisors are expected to actively participate in the training. Employers must document attendance and keep for two years a copy of the webinar, plus all written materials, responses submitted during the webinar, and all written responses or guidance the training provided during the webinar.

Increased Protections for Employees Who are Victims of Crime or Abuse

AB 2992 expands protections for employees who take time off from work as a result of crime or abuse. Existing law requires that employers with 25 or more employees allow an employee who was the victim of domestic violence, sexual assault and/or stalking to take time off to seek medical attention or related services. The new law expands those protections to include victims of any other crime or abuse that causes physical or mental injury and a threat of physical injury, and any person whose immediate family member is deceased as the direct result of the crime. Under this law, immediate family members are broadly defined to include child, parent, sibling, partner and any other individual whose close association with the employee is the equivalent of a family relationship. Employers are prohibited from discharging or discriminating against employees who take time off for reasons defined in the law. Find more information here.

Unlimited Vacation

With more companies offering employees “unlimited vacation,” it’s important to note some recent case law around the payout of unused vacation upon termination. In McPherson v. EF Intercultural Foundation, multiple former employees sued for failure to pay unused vacation. They had been told by the company that they could take an unspecified amount of time off for vacation, subject to their supervisor’s approval. Because the employer did not have a written policy that clearly defined and communicated the obligations of employee and employer in requesting and approving time off, the Court required that the employer make some payment to the employees for expected vacation that they did not use.

If you offer, or are considering offering unlimited vacation, be sure you have a written policy and that you review it with your legal counsel for compliance. Also, be sure that you administer the policy consistently and you communicate it to your employees. Note that unlimited vacation policies should not apply to non-exempt employees.

EEOC Pay Data Reporting

Although federal EEO reporting has been paused, California passed legislation in September (SB 973) that requires employers with 100 or more employees to report certain pay and other data to the Department of Fair Employment and Housing (DFEH). The first report is due March 31, 2021 and annually thereafter. Find out more about reporting requirements here.

Minimum Pay Changes

Finally, please note these minimum pay rate changes for California employees, all effective January 1, 2021.

Non-exempt minimum wage:

$14/hour for employers with 26 or more employees
$13/hour for employers with 25 or fewer employees

Minimum exempt salary:

$58,240/year for employers with 26 or more employees
$54,080/year for employers with 25 or fewer employees

Computer Software Professionals: $98,907.70 per year ($47.48 per hour)

Minimum wage rates may vary according to the city/county where the employee works. Be sure you are adhering to local requirements.

As always, please reach out to me at michelle@connecttohr.com if you have questions.

In my next article we’ll cover some new laws and regulations specifically related to COVID-19.

Answers to Your HR Questions – Just in Time

Managing the many aspects of the HR function can be challenging, especially if you are also trying to run the business or are new to HR operations. In small and medium sized companies, the “HR person,” whether it’s the business owner or someone dedicated to that role, is often flying solo with no one to consult about an HR issue or the details of a new compliance requirement. Trying to find answers via an online HR database can be frustrating and time consuming.

Now, as we look at returning to work following the COVID-19 shelter-in-place mandate, business owners are faced with a new set of challenges:

How do we safely reopen?
What if someone does not want to come back to work?
What protective equipment do we need?
What are the new working guidelines?
How do I even get started?

Connect to HR’s Just in Time 3-Hour HR Advisory Service has the answers. With this service you can access up to 3 hours of “live” HR consulting support from a trusted, senior-level HR consultant by phone, email or in person. Our service is specifically designed for small to medium sized companies:

Owners/CEOs/Nonprofit Leaders
Those running the HR function
People new to HR operations

Whether you need a sounding board to discuss approaches to an employee relations issue, want tips on how to create a workforce plan, or have questions about implementing a social distancing protocol in the office, Connect to HR’s Just in Time 3-Hour HR Advisory Service is here to help.

You do not have to do it alone!

Contact us today for a FREE 30-minute consultation to see how our Just in Time 3-Hour HR Advisory Service can benefit you.

https://calendly.com/michellemendoza-connecttohr/30-minute-consultation

You can reach me directly at michelle@connecttohr.com, and find out more about our services at www.connecttohr.com. Click here to learn more about our Just in Time 3-Hour HR Advisory Service.

Emergency Paid Sick Leave and Emergency FMLA – What You Need to Know

The Families First Coronavirus Response Act (FFCRA), effective as of April 1, 2020, sets forth new requirements for employers regarding sick leave and family medical leave related to coronavirus (COVID-19). Here are the highlights of what you need to know and need to do as well as some links to more information.

Who is affected by the FFCRA?

All employers with 500 or fewer employees, both for-profit and nonprofit businesses.

What does it require?

FFCRA requires that covered employers provide to employees the following.

Emergency paid sick leave:

Two weeks (up to 80 hours) paid sick leave at the employee’s regular rate of pay when the employee is unable to work due to COVID -19 because the employee is
- Subject to Federal, State, or local quarantined or isolation order;
- Advised by a health care provider to self-quarantine, and/or
- Experiencing COVID-19 symptoms and seeking medical diagnosis.

Note: The regulations interpret “quarantine or isolation orders” to include “a broad range of governmental orders, including orders that advise some or all citizens to shelter in place, stay at home, quarantine, or otherwise restrict their own mobility.” That being said, if a business closes because of a shelter in place order, either because its customers are required to stay at home or because the order forced the business to close, and the employee cannot telework, the employee is not eligible for paid sick leave under the Act (because the reason the employee cannot work is because the business was subject to the order, not because the employee was subject to the order).

Two weeks (up to 80 hours) paid sick leave at two-thirds the employee’s regular rate of pay when an individual has been employed at least 30 days and is unable to work because of a
- Bona fide need to care for a quarantined individual, or
- Care for a child (under 18) whose school is closed, or childcare provider is closed/unavailable due to COVID-19, or
- Is experiencing any other substantially-similar condition specified by the U.S. Department of Health and Human Services.

Note: Part-time employees are eligible for the number of hours of leave that the employee works on average over a two-week period.

Expanded family and medical leave:

Up to an additional 10 weeks of paid expanded family and medical leave at two-thirds the employee’s regular rate of pay when an employee is unable to work because of a
- Bona fide need for leave to care for a child whose school or childcare provider is closed or unavailable because of COVID-19.

Note: The expanded family and medical leave can be used intermittently between April 1, and December 31, 2020. For example, if employee does not have childcare for two of the five days of work, they can use the leave for those two days until the 10 weeks is used up or December 31, whichever comes first.

New posting required

All covered employers must post/provide to employees a Notice of FFCRA Requirements as follows:

Employers who are still open should print out the notice and post with other required notices. Another option is to provide individual copies to employees.
Employers with staff working remotely may email the notice to all employees to meet the requirement.

Employee documentation required

FFCRA stipulates that employers must require that employees provide documentation in support of emergency paid sick leave, including:

Employee name
Qualifying reason for leave
Statement that the employee is unable to work, including remotely, for that reason
Dates of requested leave
Documentation of reason for leave, such as
- Quarantine or isolation order
- Name of health care provider advising employee to self-quarantine
- Website post/email notice of school or childcare provider closure

For more information be sure to visit the following websites:

Employer Paid Leave Requirements (Department of Labor): https://www.dol.gov/agencies/whd/pandemic/ffcra-employer-paid-leave#_ftn7

FFCRA Q & A (Department of Labor):
https://www.dol.gov/agencies/whd/pandemic/ffcra-questions

Federal laws may run concurrent with CA laws

California employers should keep in mind that state and local laws (city or county) related to sick leave and family leave may differ from federal law. Be sure you are complying with laws pertinent to your location and/or where you have employees as some of these laws run concurrently in certain circumstances.

Tax credits

Covered employers qualify for dollar-for-dollar reimbursement through tax credits for all qualifying wages paid under the FFCRA. Qualifying wages are those paid to an employee who takes leave under the Act for a qualifying reason, up to the appropriate per diem and aggregate payment caps. Applicable tax credits also extend to amounts paid or incurred to maintain health insurance coverage. Find out more information here. For the most current information about the loan programs, visit the SBA coronavirus webpage, or go directly to the SBA loan application page. The Paycheck Protection Program (PPP) loans will also be available through most major banks in the coming weeks.

I am in the process of putting together additional resources to help you during this crisis. Stay tuned, and please feel free to reach out if you have questions.

Protecting Your Employees and Your Business During COVID-19

As the coronavirus pandemic (as officially declared by the World Health Organization) occupies our daily news feed, many business owners, non-profits and corporations are scrambling to figure out exactly what to do. In the case of small businesses or non-profits they may not have the luxury of telling their employees to work remotely for the next three weeks. On the other hand, they know that the health and safety of their employees is a top priority.

This blog is a summary of steps you may need to take to stay in compliance with employment law, protect your employees, and protect your business. This is an evolving situation, so we suggest checking the official websites we list below to stay informed of any recent updates.

Stay informed and educate employees

Refer to the CDC (Center for Disease Control and Prevention), World Health Organization and OSHA for the latest information and guidance about the Coronavirus (COVID-19). Certain county and states have taken additional steps to secure public safety. Please check your local health department websites for specific regional information.
Educate employees on what is known about the virus and how to prevent the spread of illness.
Implement a communicable illness policy and response plan that may allow for flexible work and telecommuting, minimizing exposure between employees and with the public, and postponing or canceling large meetings or events.
Follow the CDC guidance on dealing with COVID-19 by actively encouraging sick employees to stay home. If an employee has acute respiratory illness symptoms, send them home immediately. It’s also important to provide information and training to employees on: cough and sneeze etiquette; proper hand hygiene (wash for at least 20 seconds); avoiding close contact with sick people; keeping hands away from their face; not sharing personal items with coworkers; using a tissue to open doors; and sanitizing workspaces. Also, provide hand sanitizer.

Review your sick leave policy especially if your business is either located in California or has employees working remotely in California

Allow employees to use paid sick leave for COVID-19 related illnesses. However, under California law and in other jurisdictions, you cannot require quarantined workers to exhaust their paid sick leave.
Do not punish employees for using paid sick leave or for taking time off to care for a sick family member.
Make other paid leave available if sick leave is exhausted.
Consult local paid-sick-leave laws that may be more generous than the statewide law.

Inform employees of additional leave/benefits that may be available

Employees with serious conditions stemming from COVID-19 might be covered by The Family and Medical Leave Act (FMLA) or The Americans with Disabilities Act (ADA). In California it’s important to keep in mind the California Family Rights Act (CFRA) and the California Fair Employment and Housing Act (FEHA). It’s important to consult your employment counsel as to whether any of these apply to an employee’s situation.

Employees who are unable to work due to COVID-19 exposure may be able to file a disability insurance claim with the EDD (Employment Development Department). In CA, the EDD website has timely and important information on how employees can apply for unemployment insurance or disability coverage. Here’s the link to the CA EDD website: https://www.edd.ca.gov/about_edd/coronavirus-2019.htm

Bear in mind that although the EDD requires a physician’s certification, in the current environment medical professionals may be overwhelmed and unable to provide that certification in a timely manner. Allow some flexibility in the turnaround time for those certifications. Workers may also be eligible for unemployment insurance benefits if their work hours have been reduced by their employer or the company has temporarily shut down.

Along with health, safety and compliance issues, if you decide to offer telecommuting or require employees to work at a location other than their typical work situation, please be sure to review your company policies before making the change. Also, be sure to keep in mind that you may have to consider wage and hour issues for non-exempt employees as it relates to reporting pay, travel pay and reporting time.

Most of all, remember that employers are responsible for maintaining a safe and healthy work environment for their employees.

This topic is top of mind for many individuals. I suggest being proactive and letting employees know that as a company you are aware of the issues and you have a plan. If you need assistance, please reach out to me.

Stay well!

New Employment Laws for 2020

California has enacted a number of new laws for 2020. Becoming familiar with them will help you stay in compliance and avoid costly penalties. Also, be sure to update your Employee Handbook to reflect the new legislation.

California has enacted a statute, AB5, effective as of last month, that makes it much more difficult to classify workers as independent contractors.

AB5 applies a strict “ABC test” to determine whether a worker is an employee or independent contractor, and puts the burden of proof on the employer. In order to be classified as an independent contract, the worker must meet each of the following:

(A) The worker is free from the control and direction of the hiring entity in the performance of the work, both under the contract for the performance of the work and in fact; AND
(B) The worker performs work that is outside the usual course of the hiring entity’s business; AND
(C) The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.

There are some exemptions including doctors, dentists, insurance agents, lawyers, accountants, real estate agents, hairstylists, and a variety of creative professionals. AB5 also exempts business-to-business contractors subject to a 12-factor test.

Misclassification can be extremely costly for employers in legal fees, back wages and benefits, and penalties. Now is an ideal time to do an overall review of how you’ve classified your workers. Also, it’s important to consult with an employment attorney if you plan to audit your records and reclassify your contractors.

SB142 – Lactation Accommodation – requires that all employers provide a safe, private and clean lactation room that is not a bathroom. The room must have access to a power supply for breast pumps, and a sink and refrigerator that are close to the employee’s workspace. Additionally, employers must provide reasonable rest breaks to express milk. They must also develop and distribute a policy. Employers may not discharge, discriminate or retaliate against an employee for exercising rights under the law. If an employer denies reasonable breaks or adequate space to express milk, they will suffer the penalty of an additional one hour of pay for each day there is a violation. Employers with fewer than 50 employees may seek an exemption from the requirement.

SB188 – The Create a Respectful and Open Workplace for Natural Hair Act (CROWN Act) – protects employees from racial discrimination based on hairstyle. The law clarifies the definition of race for the workplace and educational institutions to include, but not limited to, hair texture and protective hairstyles, and defines protective hairstyles.

Other changes of note:

The federal minimum salary threshold for exempt employees was increased as of January 1. Note that California employers must comply with the state’s higher thresholds for their employees working in the state. For employers with at least 26 employees, the minimum annual salary for a managerial, administrative, or professional employee in California to be classified as exempt is $54,080 ($49,920 for employers with 25 or fewer employees).

California increased its minimum wage as of January 1 to $12/hour for employers with 25 employees or fewer and $13/hour for employers with 26 employees or more. Several cities within the state also increased their minimum wage. Be sure you are paying employees based on the minimum wage in the city where they work or in the state of California, whichever is higher.

Here’s a reference regarding California minimum wage increments to keep handy: https://www.dir.ca.gov/dlse/faq_minimumwage.htm

The deadline for harassment prevention training has been extended to January 1, 2021 for most California employees.

Connect to HR is Celebrating its 10th Anniversary!

It’s hard to believe, but it has been 10 years since I decided to leverage my human resources experience and start my very own business – Connect to HR.

It hasn’t always been easy, as you business owners will know, but it has always been gratifying, educational and inspiring! Having my own business has been like getting an MBA. It’s been the best teacher and has pushed me outside of my comfort zone.

This is the first in a series of blogs about my journey as a small business owner. Along the way I’ll be sharing some tips and lessons learned – how to get off to a good start, how to stay motivated, how to deal with setbacks, how to evolve to meet client needs, and more.

Before Connect to HR

After years of working in senior-level positions for large corporations across a variety of industries, I decided to leave the corporate world in search of work-life balance and a different work environment. Shortly after leaving, I had the opportunity to do some consulting work. One of my consulting engagements was with Apple, who had been around for a while, but still had that “start-up” feel. I was fortunate to do three consulting projects around the time Apple was reinventing itself and launching its first versions of the Apple iPod, iPad and iPhone. In between these projects, I had an opportunity with a nonprofit that was looking for someone to set up their human resources fundamentals. They wanted someone who could work in a small organization, but who had the experience of a larger, more established environment. I went from being part of an HR team to an HR Department of one. It was challenging and exciting and really honed my ability to be resourceful to get things done.

Other consulting opportunities followed, and I realized two things: 1) There was a big need for compliance experience. We were just coming off the downturn, and many companies had neglected that aspect of HR. And 2) I no longer wanted to work through someone else and lose part of the profit from my consulting gigs.

It was time to start my own business. In 2010, Connect to HR was born.

Getting Started

Running your own business requires you to wear many hats – management, marketing/sales, finance, administration, accounting, IT the list is long – in addition to actually doing your core work. SCORE is a great resource for small business owners. They have workshops on a variety of business topics and even offer experienced businesspeople as mentors. I learned a lot from their small business fundamentals workshop, and later had the opportunity to present a workshop on HR fundamentals for small businesses at SCORE for 4 years.

The human resources function is pretty broad, so one of the first steps was for me to decide on my focus area. I had worked in all aspects of HR, but was particularly interested in the legal area. In fact, at one point I had contemplated attending law school. Also, in the consulting work I’d done it was clear that there was a demonstrated need for compliance.

I decided that these three areas: employee relations, compliance and policies and procedures (Employee Handbook) would be my starting point, and I was off to the races!

Tips for getting started: Learn the fundamentals of starting a business. Be clear about your focus.

Tune in next time when I’ll share about acting on inspiration.

Time to Review Your HR Year-End Checklist

There are just a few weeks left until the holidays and year end. Before you get caught up in all the festivities, it’s a good idea to set aside some time to make sure you have addressed any outstanding HR issues for 2019, and have finalized your plans for 2020 and the new decade.

Be sure you have made the appropriate adjustments to comply with recent legislation, specifically:

The deadline for harassment prevention training has been extended to January 1, 2021 for most California employees.

California has enacted a statute that makes it much more difficult to classify workers as independent contractors, effective January 1, 2020.

The federal minimum salary threshold for exempt employees is being increased, effective January 1, 2020.

California is increasing its minimum wage again as of January 1, 2020. Several cities within the state also are increasing their minimum wage.

Here’s a checklist of other items to complete before year end. Be sure to add any items relative to your particular business that you don’t see here.

Order any updated Federal and State Labor Law Posters
Review your Employee Handbook to identify any changes needed based on new laws, policies and/or procedures
Review and update employee addresses in preparation for W-2 distribution
Review and update job descriptions
Finalize the HR Budget for 2020
Finalize focal process for 2020
Finalize company goals
Determine dates of company holidays for 2020
Finalize and announce any new benefits/employee perks for 2020
Renew any annual memberships and subscriptions
Schedule annual reviews with employees
Deal with any lingering employee relations issues

In addition, think back over the year and reflect on what went well and what didn’t go well from an HR standpoint. Are your employees engaged and productive? If not, do you see any trends that you could work on turning around in 2020? Are there any employees who stand out as particularly high potential? How will you develop and retain them in 2020?

This is also a good time to look back over the past decade. Reflect on how your organization has changed and celebrate your accomplishments over the past decade. Also, consider what you want to usher into the next 10 years. If you don’t know where to start, consider conducting a SWOT analysis in the New Year. This way, you can become aware of trends both inside the company as well as in your industry.

Giving some thought to these things now, and then putting a plan in place to address them after the first of the year will get 2020 off to a good start!

I would love the opportunity to help you plan for 2020 and the next decade please contact me at michelle@connecttohr.com.

New Federal Salary Threshold for Exempt Classification

As of January 1, 2020, the federal salary threshold for employees to qualify as exempt from overtime will increase from $455 per week ($23,660 per year) to $684 per week ($35,568 per year). For employees to qualify under the Fair Labor Standards Act’s (FLSA) “highly compensated employee” exemption, the minimum salary threshold will increase to $107,432 per year.

As a reminder, for an employee to be classified as exempt, they must meet both the minimum salary requirement and the “duties test.” This new law does not make any changes to the duties test.

It also does not affect employees in California, where the exempt salary threshold is higher.

California employers must comply with the higher thresholds for their employees working in the state. The minimum annual salary for a managerial, administrative, or professional employee in California to be classified as exempt is $49,920 ($45,760 for employers with 25 or fewer employees). Also, California does not recognize the “highly compensated employee” exemption.

Another difference is that the federal law allows for bonuses, commissions and incentives that are paid at least annually to be counted toward the minimum salary requirement. California makes no such provision. And California’s duties test is stricter than the duties test under federal law. Here, an employee must spend more than 50% of their time in each workweek performing exempt duties to qualify as exempt from overtime.

If you have employees outside of California now is the time to review your compensation plans for exempt employees and make any changes needed to comply with the new federal law by January 1.

If you only have employees in California, it’s also a good time to review employee compensation and classification to ensure you are complying with California law.

Please reach out to me at michelle@connecttohr.com if you need help reviewing employee classifications.

New Law Impacts California Independent Consultants

As we head into the fourth quarter of 2019, there are a couple of legal updates you should be aware of.

First, Governor Newsom has signed into law AB 5, which further clarifies the distinction between employees and independent contractors. The law goes into effect on January 1, 2020 and is expected to have a big impact on gig-economy companies like Lyft and Uber, as well as app-based services that depend on contractors such as food delivery and dog-walking services.

Second, the deadline for harassment prevention training (now required for all employees of companies with 5 or more employees including independent contractors) has been extended to January 1, 2021. This will allow more time for large employers who previously only trained supervisors to train their other employees and for smaller companies to train both supervisors and employees. As a reminder, training for supervisors must be at least two hours, and training for non-supervisors must be at least one hour. Training must be repeated at least every two years. Remember to keep records of training for both employees and supervisors.

AB 5 adopts the “ABC” test, which I wrote about earlier this year, to determine whether an individual is an employee or an independent contractor.

Under the ABC Test, in order to classify a worker as an independent contractor the hiring entity must establish that the worker meets EACH of the following three factors:

The worker is free from the control and direction of the hiring entity in the performance of the work, both under the contract for the performance of the work and in fact; AND
The worker performs work that is outside the usual course of the hiring entity’s business; AND
The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.

One of the things I tell clients is that it’s essential to consider how you define your core business (2) and how does the worker assist you in that core business.

The new law allows for a few exceptions for positions that are subject to the 9-factor Borello test. Some examples of positions that fit into this category are: insurance brokers, physicians and surgeons, hairstylists, attorneys, and accountants.

Please feel free to contact me at michelle@connecttohr.com if you need assistance.