As February ends, there are many developments on the employment legal front. Here are five prevalent employment issues for California and across the U.S.:
1. California Supreme Court holds employers may not round time entries for meal periods.
On February 25, 2021, the California Supreme Court held that employers may not engage in time rounding time punches for meal breaks under California law. The case, Donohue v. AMN Services, Inc., the Court held that “meal period provisions are designed to prevent even minor infringements on meal period requirements, and rounding is incompatible with that objective.” The Court distinguished time rounding policies in the context of meal breaks from time rounding policies for tracking an employee’s work time. A California Court of Appeal held in See’s Candy Shops, Inc. v. Superior Court (2012) that employers may use rounding policies “to calculate regular and overtime wages if the rounding policy is neutral on its face and as applied.” In Donohue, the Court explained that meal breaks are different: “In the meal period context, however, there is an asymmetry between the treatment of rounded-up minutes (i.e., time not work that is compensated with regular pay) and the treatment of rounded-down minutes (i.e., time worked that may trigger premium pay).”
The Court also raised concerns about time rounding policies given the ease of tracking employees’ time with technology, and the Court noted, “[a]s technology continues to evolve, the practical advantages of rounding policies may diminish further.”
The Court also held that time records showing late, short, or missed meal breaks “raise a rebuttable presumption of meal period violations, including at the summary judgment stage.”
2. Lawsuit challenging Cal/OSHA Emergency Temporary Standards (ETS) regulations is denied.
On February 25, 2021, the San Francisco Superior Court denied a group of employer’s application for preliminary injunction attempting to prevent Cal/OSHA’s Emergency Temporary Standards that were issued on November 30, 2020. In denying the preliminary injunction, the court stated that “the balance of interim harms and the public interest in curbing the spread of COVID-19 and protecting worker and community health weigh heavily in favor of the continued implementation and enforcement of the ETS Regulations.”
California employers must still comply with the Cal/OSHA ETS regulations. For more information about the ETS regulation, see our prior post here.
3. Federal $15 minimum wage is not going to be part of President Biden’s COVID-19 relief bill.
On February 25, 2021, the Senate parliamentarian Elizabeth MacDonough ruled that minimum-wage legislation could not be passed through the budget-reconciliation process, and therefore would not be included in the $1.9 trillion relief package. The Federal minimum wage, which is currently at $7.25 per hour, could still be increased through other paths. Given the 50-50 Democrat-Republican split in the Senate, it appears that an increase in the Federal minimum wage will likely need to be a compromise. Some proposed compromises include raising the minimum wage to $11 or $12 per hour, setting increases in minimum wage on a regional basis across the country, or limited the higher minimum wage to larger employers only. Employers across the country will need to pay attention to see how this legislation develops. Our prior post on President Biden’s COVID-19 Rescue Plan can be read here.
4. California pay data reporting is due March 31, 2021.
As California employers are preparing to file their pay reporting data with the Department of Fair Employment and Housing (DFEH) by March 31, 2021 pursuant to SB 973 (click here for more information about the pay data reporting requirements), there are many questions arising about how to collect certain information. For example, employers need to report the pay data based on seven race/ethnicity categories:
- Non-Hispanic/Latino White
- Non-Hispanic/Latino Black or African American
- Non-Hispanic/Latino Native Hawaiian or Other Pacific Islander
- Non-Hispanic/Latino Asian
- Non-Hispanic/Latino American Indian or Alaskan Native
- Non-Hispanic/Latino Two or More Races
However, how are employers to gather this information? The DFEH published FAQs that explains: “Employee self-identification is the preferred method of identifying race/ethnicity information. If an employee declines to state their race/ethnicity, employers must still report the employee according to one of the seven race/ethnicity categories, using — in this order — current employment records, other reliable records or information, or observer perception.” Employers should document the collection of this data in order to prove compliance with this guidance from the DFEH.
5. Labor Commissioner cites Los Angeles business for COVID-19 retaliation.
On February 17, 2021, the California Labor Commissioner cited a Los Angeles employer for $125,913 for “workplace retaliation and labor law violations, after the Labor Commissioner found that the employer illegally fired four workers for reporting unsafe working conditions during the COVID-19 pandemic.” The citations include $45,193 in lost wages, $720 in interest due, $40,000 in Section 98.6 retaliation penalties, and $40,000 in Section 1102.5 retaliation penalties. As business begin to reopen in California, employers must be aware of potential COVID-19 claims and ensure all employment decisions are well documented.