Whether your business is big,small, or in between, you’ll be wise to keep track of new laws affecting your operations. Some took effect before the New Year, while the rest went live Jan. 1. Here are the top 10 you need to heed:
1. SB 459: This law took effect on Nov. 9 and imposes a big fine – up to $25,000 per violation – on employers that misclassify employees as contractors. Violators not only have to pay the fine, but they will be tagged publicly for it. The law has a scarlet letter provision that requires violators to post a notice admitting their guilt. The posting must be on the business’s website or in a prominent place where employees and the public can see it. California’s Labor Code, meanwhile, has a vague definition of an independent contractor, so it will pay to classify workers correctly.
2. Compliance posters: After one of the most active legislative sessions in years, the state of California will release up to four mandatory-to-post labor law changes. Starting on Jan. 1, employers must display the following posters in the workplace:
• Discrimination and Harassment in Employment are Prohibited by Law. The state added gender, gender identity and gender expression to the list of protected classes.
• Pregnancy Disability, Notice A. This states the Department of Fair Employment and Housing requires that employers continue to provide and pay group health plan benefits for women during pregnancy disability leave. However, if no health coverage is provided, none is
required to start when pregnancy disability leave is taken.
• Family Care and Medical Leave (California Family Rights Act Leave) and Pregnancy Disability Leave, Notice B. This has been revised to include the statement: “The CFRA prohibits us
from denying, interfering with or restraining your exercise of these rights.”
Another compliance poster is still in the works, and is expected to reflect big changes to
workers’ compensation laws.
3. Commissions in writing: This has to be in place by Jan. 1, 2013, but don’t put it off, it’s important to set in motion. It requires contracts be written up for jobs paid via commissions.
It must explain the payment method for commissions, with a copy provided to the employee who signs the agreement. The terms remain in full force until the contract is rewritten or employment ends. Commissions do not include short-term productivity bonuses or profit
sharing unless the employer agrees to pay a fixed percentage of sales or profits as compensation.
4. Fed W-2 health care costs: Part of health care reform measures requires that employers report on W-2 forms the cost of employer-sponsored health coverage provided to employees. While this isn’t required for 2012 W-2s, employers need to put procedures in place in order to capture the relevant information this year for the 2013 W-2, although employers that file fewer than 250 W-2s are exempt until the IRS issues further guidance. Coverage cost is the amount of premium charged and includes portions paid by both the employer and employee and the covered employee’s family.
5. NLRB poster: The National Labor Relations Board has issued a final rule requiring most private sector employers to post a notice telling employees of their rights under the National Labor Relations Act. Employers must also provide a link to the notice from their internal or external website if they regularly use the site to inform staff of personnel rules or policies. Employers must display the new poster by Jan. 31.
6. AB 22: This bans most employers from getting credit information about applicants or employees. Labor unions backing the measure argued credit reports can’t measure an applicant’s honesty, integrity or other traits, and are often inaccurate anyway. But businesses said they show an applicant’s integrity and can reduce future litigation and loss. Credit checks are still allowed for applicants who handle personal information, company funds, and for managerial positions, police, Department of Justice jobs, or when legally required. Banking and fi nancial institutions are exempt.
7. Domestic partner benefits: Current law prohibits insurance companies and insurance providers from not insuring the domestic partner of the premium holder. As of 2012, the Insurance Nondiscrimination Act, SB 757 ends its exemption for policies issued outside of California to employers located primarily outside of the state with most of its employees
also outside of California. Now every group health insurance policy provided to a California resident, regardless of the employer’s location, must offer equal coverage for spouses and registered domestic partners.
8. Genetic discrimination: This law, which took effect Jan. 1, widens the areas in which genetic information cannot be used to discriminate against employees. Those protections had been limited to employment and health insurance coverage. It now includes housing, employment, education, public accommodations, health insurance coverage, life insurance coverage, mortgage lending and elections. It defines “genetic information” as an employee’s genetic tests, or those of an employee’s family members, and a disease or disorder in an employee’s family. That means hiring or employment discrimination based on any of the above characteristics is now against the law.
9. Organ, bone marrow donation leave: This law, from SB 272, requires private sector employers with 15 or more employees to grant up to 30 business days of paid leave in a one-year period to an employee donating an organ, and five business days in a one-year period for employees donating bone marrow. The employee’s normal paid time off is not affected by donation time off, and health care coverage must also be maintained during donation leave.
10. Human Trafficking Disclosure: SB 657, the California Transparency in Supply Chains Act, requires large-volume retail and manufacturing companies to disclose their efforts to ensure their direct supply chains are free from slave labor and human traffi cking. Companies must verify supply chains and their risks of slavery and human trafficking, do surprise audits of suppliers to determine compliance, have procedures to deal with suppliers found out of compliance, and train employees and managers in supply chain management.