As 2020 ends, this Friday’s Five focuses on five steps employers can take now to prepare for 2021:

1. Update employee handbooks to comply with SB 1383 – California Family Rights Act (CFRA) now applies to employers with 5 or more employees.

There has been overhaul of the California Family Rights Act (CFRA) which will have a monumental impact on many employers throughout the state. The new law requires employers with as few as five employees to provide up to 12 weeks of unpaid job protected leave during any 12-month period for certain covered reasons.  In addition, the definition of family members covered under the law has also been expanded so that it no longer just includes a spouse, a parent or a child, but employees can take leave to care for grandparents, grandchildren, siblings, or  domestic partners with a serious health condition.  Smaller employers will need to develop a CFRA policy to comply with the new requirements, and larger employers will need to update their leave policies to address the other changes (such as the expanded definition of family member, elimination of key employee provisions, among other changes).

2. Update employee handbooks to comply with AB 2017 – Kin Care leave under Labor Code section 233.

This new law provides that the designation of the sick leave taken under Labor Code section 233 is at the sole discretion of the employee.  Therefore, the employer may not designate sick leave as Kin Care leave by itself in order to quickly deplete the Kin Care leave available. Any Kin Care leave policies and related policies should be updated accordingly.

3. Update employee handbooks to comply with AB 2992 – leave policies for victim of domestic violence, sexual assault, or stalking.

AB 2992 expands the right to take time off work under Labor Code section 230.  The new law permits employees to take time off if they are victims “of a crime that caused physical injury or that caused mental injury and a threat of physical injury” or for anyone “whose immediate family member is deceased as the direct result of a crime.”  Employers must update any relevant crime victim leave policies to comply with the new requirements.

4. Exempt employees – review salary requirements.

Employers need to review the base salary for all exempt employees to ensure the employees meet the salary required to be exempt.  To be exempt from the requirement of having to pay overtime to the employee, the employee must perform specified duties in a particular manner and be paid “a monthly salary equivalent to no less than two times the state minimum wage for full-time employment.” (Lab. Code, § 515, subd. (a).)  For more information about the salary basis test for exempt employees, see my previous article here.

With the increase in the state minimum wage on January 1, 2021, the equivalent of two times the minimum wage of $13 per hour for small employers (25 employees or less) equals $54,080 per year, and two times the minimum of $14 per hour for large employers (26 employees or more) equals $58,240 per year to qualify for the white collar exemptions.

It is important to note that the salary basis test is set according to the California state minimum wage, not the applicable minimum wage that may apply in the various local city and counties in California.

5. Update severance agreements to ensure they comply with AB 749 and AB 2143.

AB 749 prohibits and invalidates any provisions in settlement agreements entered into on or after January 1, 2020 that prevent workers from obtaining future employment with the settling employer or its affiliated companies under certain circumstances.  AB 2143, passed in 2020, provides an exception to this ban, if the employer documented in good fair, prior to a claim, that a person engaged in sexual harassment, sexual assault, or criminal conduct.