1. Ensure the new hire packets contain all required information for employees.
If employers do not have a standard new hire packet, the first step in 2016 should be implementing this packet. There are many disclosures and documents that need to be provided to employees when they are hired. This packet should be reviewed by legal counsel as well to ensure that all required forms are included for each employee. For example, employees earning commissions must be provided the commission agreement in a writing signed by both the employee and the employer. See Labor Code Section 2751.
2. Review pay stubs to ensure they are compliant.
The DLSE provides an example of a pay stub and the required information for an hourly employee:
Also, do not forget that with California’s paid sick leave law that took effect on July 1, 2015, employers will have additional reporting information regarding employees’ accrued paid sick leave and usage. Employers must show how many days of sick leave an employee has available on the employee’s pay stub or a document issued the same day as a paycheck.
3. Analyze if arbitration agreements are appropriate.
Employers should understand the potential benefits and costs associated with arbitration agreements, and should review with counsel whether they might be appropriate for their workforce.
4. Review payroll practices and ensure overtime is being paid correctly.
If non-exempt, review to ensure the appropriate overtime is being paid at the proper rate, and that all overtime is being paid for work done over eight hours in a day and 40 hours in a week.
Generally, any work performed over eight hours in any workday or more than six days in any workweek requires that the employee is compensated for the overtime at not less than:
- One and one-half times the employee’s regular rate of pay for all hours worked in excess of eight hours up to and including 12 hours in any workday, and for the first eight hours worked on the seventh consecutive day of work in a workweek; and
- Double the employee’s regular rate of pay for all hours worked in excess of 12 hours in any workday and for all hours worked in excess of eight on the seventh consecutive day of work in a workweek.
Employers should review that the employee’s “regular rate of pay” used for calculating overtime includes all required payments to the employee such as non-discretionary bonuses, piecework earnings, or commissions. The Department of Industrial Relations provides some good examples on what must be included when calculating the regular rate of pay and how to calculate the applicable overtime.
5. Understand new laws taking effect in 2016.
Employers should learn about the new laws passed that are effective in 2016. I’ve posted some excerpts from a webinar I recently conducted last week on a few new laws facing California employers in 2016. I’ll be posting additional excerpts soon as well. If you would like to be notified about future webinars or seminars I conduct, you can sign up here.