10 fresh worker protections in 2020

10 fresh worker protections in 2020

Feb

19

2020

SACRAMENTO – From breastfeeding accommodations to gender pay equity to combatting bias against hairstyles, several new laws took effect last month that impact California workers and their jobs. While AB 5 – the landmark bill regulating whether workers are employees or independent contractors – dominated headlines, there are 10 laws now on the books that will also have a significant impact on the workplace.

Saying “no” to privatized justice

Our labor laws mean nothing if workers are forced to waive those rights by signing a mandatory arbitration agreement. These agreements operate to suppress workplace claims by barring workers from bringing a lawsuit and exposing workplace abuse.

California law should now prohibit employers from coercing workers into signing these arbitration agreements as a condition of employment, but the law already is being challenged in court. If the challenge fails, workers could reject a mandatory arbitration agreement (making arbitration truly optional to resolve an employment dispute). Importantly, the new law also protects workers from retaliation – meaning they cannot be fired or not hired – if they refuse to sign an arbitration agreement.

For workers who do end up in arbitration, the odds are stacked against them. Increasingly, employers are refusing to even pay their share of arbitration fees, as a way to stall cases indefinitely. Now another new law will level the playing field by empowering workers to proceed to court, instead of arbitration, if the employer delays paying their share of fees.

Greater protections for harassment survivors

State lawmakers have continued advancing #MeToo reforms to combat sexual harassment. Now, workers have an extra two years to bring harassment or discrimination claims under California’s Fair Employment and Housing Act. Also, building on the new law that bans secrecy around sexual harassment settlements, employers can no longer use “no-rehire” clauses – which punish victims by barring future employment with the employer and related entities, as a condition of settling.

A more equitable workplace

Workplace equity is the focus of several new measures now taking effect. First, many working mothers will have safe and clean lactation rooms with access to water, electricity, and refrigeration. Second, the CROWN Act will combat workplace bias against hairstyles that disproportionately impacts African American women. This new law will make it unlawful to discriminate against natural hairstyles and textures historically associated with race.

Equity extends beyond the traditional workplace, as exemplified by the US Women’s National soccer team in their quest for their fourth World Cup – which featured a prize pool valued at a paltry one-tenth of the men’s tournament. California will do its part by requiring permitted events on public lands to offer equal prize money, regardless of gender.

Finally, a new law will allow workers to collect a monetary penalty from their employer if they are paid late. This escalating penalty will deter repeat offenders and encourage employers to always pay their workers on time.

A justice system for all

Earlier this year, the Chief Justice of the California Supreme Court spoke out about the chilling effect of recent arrests of undocumented immigrants in our state’s courthouses. California law will now protect undocumented workers from civil arrest while attending a proceeding or other legal business in the courthouse.

California also took another step towards the promise of equal justice under the law. Soon, all judges, public-facing court staff, and attorneys will be required to attend implicit bias training to help identify their own biases in order to more fairly uphold our laws.

The upcoming legislative session is already looking packed, with proposals on major issues, such as workplace privacy, paid family leave, and adjustments to AB 5. We hope you stay tuned.

About Ken Wang, Esq.

Legislative Policy Associate, California Employment Lawyers Association

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Ken Wang, Esq.

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All California companies should mind their ABCs in classifying workers

All California companies should mind their ABCs in classifying workers

Jun

12

2018

Courier On Bicycle Delivering Food In CityBy Hina Shah

The California Supreme Court recently issued a unanimous 82-page decision in Dynamex Operations West, Inc. v. Superior Court  that settled a question of law that had not been previously decided: what is the proper legal standard in determining whether a worker is an employee or an independent contractor under California’s wage and hour laws.

Joining 14 other jurisdictions, the California Supreme Court adopted the ABC standard to determine the worker’s classification under the “suffer or permit” language of California’s wage and hour regulations, called wage orders.  A worker is presumed to be an employee unless the company can establish that (a) the worker is free from control and direction over performance of the work, both under the contract and in fact; and (b) the work provided is outside the usual course of business for which the work is performed; and (c) the worker is customarily engaged in an independently established trade, occupation or business.  Failure to prove any one of these factors will be fatal to being classified as an independent contractor.

As the Court acknowledges, the proper classification of workers not only has significance for the workers and business but also for the public at large.  When a company classifies a worker as an independent contractor, it does not have to pay federal Social Security and payroll taxes, unemployment insurance taxes and state employment taxes, provide worker’s compensation insurance, nor comply with numerous state and federal laws such as minimum wage and overtime. Of course, this results in tremendous cost savings for the business.

However, there is a compelling public interest in having workers classified as employees.  Workers depend on their wages for their survival.  By the turn of the nineteenth century, rapid industrialization, the influx of new immigrants and the shift to factory production resulted in exploitative working conditions and substandard wages.  A national movement emerged advocating for national and state legislation redefining the traditional master-servant relationship, limiting hours of work and setting a living wage.  California was at the forefront in adopting this worker-protective legislation, recognizing the unequal bargaining power between workers and companies.

Today, with globalization and technological innovation, we are experiencing another restructuring of the workplace.   The advent and rapid rise of the gig economy – the use of technology to deliver goods or services on demand – has increased the ranks of the contingent workforce.  An Intuit 2020 report authored by Emergency Research in partnership with Intuit Inc., predicts that close to 40% of American workers will be contingent workers by 2020.    But not everyone in the gig economy is properly classified as an independent contractor or freelancer.  Many on-demand labor platforms, such as Uber and Postmates, have been sued recently for misclassifying its workers.

The misclassification of workers is costly to almost everyone.  Workers are denied access to fundamental basic labor protections such as minimum wage and overtime which results in increased reliance on the public safety net.  The state of California estimates that it loses $7 billion per year in payroll tax revenue.  Businesses who properly classify their workers and comply with statutory wage protections are disadvantaged by companies who improperly classify workers as independent contractors and pocket the labor costs.

The Dynamex decision creates a simpler, clearer test that is consistent with the expansive statutory definition of “employ.”  Since 1989, a multi-factor test that arose in the context of a workers compensation case in the California Supreme Court case S.G. Borello & Sons, Inc. v. Department of Industrial Relations, guided the determination of employee status. But these factors were unwieldy and easily manipulated by employers to skirt employee status.  As the California Supreme Court acknowledged, “The ABC test allows courts to look beyond labels and evaluate whether workers are truly engaged in a separate business or whether the business is being used by the employer to evade wage, tax, and other obligations.”

No doubt the ABC test makes it easier for workers to prevail because it puts the burden squarely on employers to defeat the presumption of employee status.  But, the ABC test is not a radical departure in the law.  Each of the ABC factors were already factors under the multi-factor test, but now are given substantial weight.  Ultimately, the streamlining of the independent contractor test in wage and hour will reduce the uncertainty about whether the classification is legal.

The decision has huge ramifications for all California employers.  A 2017 report from the U.C. Berkeley Center for Labor Research and Education found that the independent contractor model has proliferated and comprises 8.5% of the California workforce, a higher portion than the national workforce.  No doubt, on-line labor platform companies will need to revamp their worker classifications in light of this case but it is not the death knell of the gig economy. As the 2017 report showed, on-demand labor platforms made up a cumulative 1.5 percent of the national workforce from 2012-2016.  What this decision does is squarely reject the idea that flexible hours and the ability work from anywhere makes one an independent contractor.

Hina Shah is an Associate Professor of Law and Director of the Women’s Employment Rights Clinic at Golden Gate University School of Law.  This post originally appeared on the American Constitution Society Blog.

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CELA VOICE

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Worker classification and secure work in the “sharing economy”

Worker classification and secure work in the “sharing economy”

Jul

22

2015

FullSizeRender-1By Veena Dubal

Last month, a California Labor Commissioner decided that Barbara Ann Berwick was an employee of (venture capital darling) Uber for purposes of employment protection under California law.   A charged media flurry followed.   If Uber drivers were employees, then was the company’s highly profitable business model kaput?   Were casual Uber drivers going to be entitled to minimum wage and business expenses (like gas and car upkeep)?  What did this mean for the potential success of other aspiring businesses in the so-called “sharing-economy”?  How did the commissioner come to this decision?  What defines an employee?

While the Berwick decision forced many non-lawyers to think about worker classification for the first time, this debate is nothing new in the tort context.   Courts have long struggled to distinguish independent contractors and employees when determining vicarious liability.   Who should be responsible for the negligence of a worker?  This question, under the common law, turned on an unwieldy analysis of whether that worker was an independent businessman, engaged in his own entrepreneurial dealings, or an employee laboring for an employer.  Far from being easily identifiable, the definition of an employee for tort purposes has resulted in much head scratching, with courts coming down differently while applying the same facts to the same (capacious) set of rules.

But where did this idea that only common law “employees” get work safety net benefits come from?  What few understand is that applying this dichotomous classification in tort law to the context of employee protections is not natural or necessary.   In fact it is relatively recent.  Whether or not the application makes good legal sense or serves broader social goals is worth pondering.

In the tort context, the inquiry boils down to an analysis (crudely put) about who deserves blame, that is, who is really in charge (or, in legal terms, who controls the means and manner of production).   U.S. courts first began to borrow this analysis and utilize it in the employment protection context when businesses tried to evade New Deal legislation put in place to protect the ordinary worker.   Prior to efforts by business representatives to dodge the costs associated with secure work, service workers – including insurance salesmen, taxi drivers, and newspaper boys – were protected under the law.   Indeed, the legislative history of the New Deal reveals no Congressional debate on whether or not “independent contractors” should be covered.  The term used over and over again, by both representatives of manufacturing and of labor, is “worker.”

Today, in what is popularly termed the corporate “sharing economy” – or perhaps more aptly, the “sharing-the-scraps economy” – companies are borrowing from post-New Deal efforts by businesses to increase their own profit through use of “contractors,” evading laws intended to force them to take responsibility for their workers.  Uber, for example, is reaping huge profits from the labor of casual drivers by calling those workers “independent businessmen.”  The company’s position has been that this contractor status of workers means that the company is not liable for the worker’s negligence – OR for the health, safety, and financial security of Uber drivers.

While across the country, judges, commissioners, and regulators have come down differently about whether or not Uber drivers are employees, the history and legislative intent of employment protections begs the question:  why are courts applying the reasoning of tort law to social policy that is intended to create a safety net for workers?

As we enter a historical moment when half the working population will be laboring casually and precariously as a result of evolving business models, we must ask not, “who is an employee” under the common law, but how do we use laws and regulations to create stable and secure work environments?

Veena Dubal is an Associate Professor at University of California Hastings College of Law.  Professor Dubal’s research focuses primarily on law and social change in the context of work law.  Her dissertation, a three year ethnography, examines the work lives and worker collectivities of taxi drivers in San Francisco. Her research suggests that conventional wisdom on lawyering on behalf of low-income independent contractors needs to be re-examined and re-configured based on the desires and everyday realities of these workers.  An earlier version of this blog post was published on the author’s blog.

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Our guest bloggers include members of CELA and other employee advocates. Email us if you are interested in guest blogging.

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