Unless otherwise stated, the laws below will go into effect on January 1, 2017

Minimum Wage Increase
The Minimum Wage continues to increase. Depending on where you live, Federal, State, and Municipal laws may all require minimum wage increases. In California, for employers who have 26 or more employees, the state minimum wage will increase to $10.50 per hour on January 1, 2017. In San Diego, California, the minimum wage for all employers will increase to $11.50 per hour on January 1.

The Federal Minimum Wage will not change for now, but one aspect of it will. On December 1, 2016, the minimum salary for exempt employees will more than double to $47,476.00 per year. That means, all exempt employees throughout the nation must make a minimum of $913 per week. But, a judge in Texas will issue a ruling on November 22, 2016 as to whether the law will go into effect on December 1.

Workers generally get the benefit of the largest minimum wage rate among Federal, State, or Municipal law. For instance, in San Diego, employees are entitled to make $11.50 per hour starting on January 1, 2017. California requires the minimum salary for exempt employees to be twice the state minimum wage level, so, the San Diego minimum salary for exempt employees will be twice the California minimum wage of $10.50 per hour rather than the San Diego minimum wage. That means the minimum salary for all exempt employees in California will be $43,680.00 per year. In other words, the higher minimum wage in San Diego will not affect the minimum salary requirement for exempt employees.

If the Labor Commissioner files a citation against an employer for not paying Minimum Wage and the employer appeals (writ of mandate) a finding by the Labor Commissioner, the employer must now post a bond equal to the amount of unpaid wages and liquidated damages. If the employer loses the appeal, then the employee will receive the bond amount, unless the employer pays the amount the court determines that employer owes within 10 days.

Agricultural Overtime
Agricultural workers in California receive Overtime premium pay after completing 10 hours of work in a day. The new law will require employers, who employ more than 25 workers, to pay Overtime after 8 hours of work starting in 2022. In 2019, the amount of time required to work before Overtime must be paid will drop to 9.5 hours a day. After that, the amount of time worked will drop a half hour each year until it reaches 8 hours per day in 2022.

Fair Pay Act
Last year, California overhauled the Fair Pay Act under Labor Code §1197.5 to bar retaliation for making a Fair Pay Act claim and broadened the definition of “unequal pay” to make it easier for employees to prove unequal gender pay. This year, the law changed again to make clear that past salary, by itself, cannot justify lower pay. In addition, the law will now allow employees to make Fair Pay Act claims based on differences in pay between employees of different races and ethnicities, not just between different genders.

Choice of Law and Forum Selection Clauses
California Labor Code §925, a new code section that will go into effect on January 1, 2017, prevents employment contracts from requiring workers who live and work in California to litigate or arbitrate their claims outside of California. Further, it prevents those contracts from designating state law, other than California law, from applying. This will probably effect out of state employers who employ California workers the most. Often, those employers have special handbook provisions or special employment contracts for California workers. Those types of provisions and contracts require the employee to file claims outside the state and/or apply the law of another state. Often those venues and laws disfavor the employee. Labor Code §925 will allow California employees to file claims in California under California law. One wonders whether this law could violate the Federal Arbitration Act. Time will tell.

Single User Restrooms
California did not want to be left out of the restroom gender discrimination controversy. Its new law forbids single-user restrooms from being labeled as a restroom for a particular gender. A single-user restroom is a toilet facility with no more than one water closet and one urinal with a locking mechanism that is controlled by the user.

Uber and Lyft must do National Criminal Background Checks
Uber and Lyft are “Transportation Network Companies” and those companies who employ California workers will now be required to perform local and national criminal background checks for drivers who use ride share platforms to get customers. Additionally, the law bars drivers with certain types of convictions or criminal history from driving for the companies. Those convictions and histories include: current registration on the U.S. Department of Justice’s National Sex Offender website, convictions for violent felonies, convictions of some terrorist related crimes, and misdemeanors for assault, battery, domestic violence, or driving under the influence that have happened within the last seven years.

Paid Family Leave (PFL) and State Disability Insurance (SDI)
On January 1, 2018, the rates for both PFL and SDI will increase from 55% to 60% or 70%, depending on the wage rate of the recipient, but those maximum rates cannot increase beyond the level set for weekly Workers’ Compensation Temporary Disability indemnity. The minimum amount for PFL and SDI will be $50 per week. PFL covers time off for caring for a seriously ill family member and for bonding with a new child.

S. Ward Heinrichs, Esq.
Employment Law Office of Ward Heinrichs
4565 Ruffner Street, Suite 207
San Diego, CA 92111
858-292-0792
(858) 408-7543 (fax)