A new round of targeted workplace regulations passed over the course of 2016 will take effect in the coming year, with some slated to come into law the minute the clock strikes 2017. 

Wage rules

First, Golden State businesses will face a new landscape on pay, beginning with mandated higher minimum wages. In lopsided Assembly and state Senate votes, lawmakers passed Senate Bill 3 into law this spring. Gov. Jerry Brown promptly signed the legislation. “The increases would start with a boost from $10 to $10.50 on Jan. 1,” the Associated Press confirmed. “Businesses with 25 or fewer employees would have an extra year to comply. Increases of $1 an hour would come every January until 2022. The governor could delay increases in times of budgetary or economic downturns.”

“Democrats who control both legislative chambers in California hailed the increase as a boon to more than 2 million of the state’s poorest workers. Republicans, however, echoed fears from business owners and economists that the annual increases — eventually tied to inflation — will compound California’s image as hostile to business.”

A battery of even more ambitious minimum wage rules has been implemented in patchwork fashion around California’s bigger municipalities in and around the Bay Area.  

Additionally, employers will be held to a new standard in justifying to Sacramento any disparities in pay that seem to correspond to racial or ethnic differences. “SB1063 amends Labor Code Sections 1197.5 and 1199.5 and expands protection for equal pay for ‘substantially similar work’ beyond gender to include race and ethnicity,” according to analysts at Faegre Baker Daniels. “Employees who perform ‘substantially similar work’ under similar working conditions must be paid equally, unless the employer can demonstrate that the wage differential is based on either: (1) a seniority system; (2) a merit system; (3) a system that measures earnings by quality or quantity of production; or (4) a bona fide factor other than sex, race or ethnicity (such as education, training or experience). Employers are required to demonstrate that these factors account for the entire pay differential.“

Close quarters

Beyond pay, legislators imposed additional requirements fueled by ongoing political controversies about the pace of social change. “Under AB1732, beginning March 1, all single-user toilet facilities in any business, place of public accommodation or government agency must be identified as ‘all-gender,'” as the San Francisco Chronicle reported, although multiple-toilet facilities can continue to offer men’s and women’s rooms. Nevertheless, the paper added, “the California Fair Employment and Housing Council is expected to finalize regulations early next year clarifying that employees can use the restroom that corresponds to their gender identity.” Some new rules targeted specific industries. With AB1289, set to take effect January 1, so-called “transportation networks” such as Lyft and Uber were barred from hiring drivers “who are registered sex offenders, violent felons or terrorists,” the Associated Press noted; that bill “will also ban people convicted in the last seven years of assault, domestic violence or driving under the influence. Companies could be fined up to $5,000 per banned driver.”

A third set of laws focused in on the intersection of criminal justice and employment law. In an effort to boost awareness of standing law, AB2337 put the onus on employers to notify employees “at time of hire of their rights to take protected leave when victimized by domestic violence, sexual assault or stalking,” according to The Recorder. “By July 1, 2017, AB2337 will further require the California labor commissioner to develop a form employers may elect to use to comply with this notice requirement.” AB1843, meanwhile, made it presumptively easier for Californians convicted before adulthood to land a job, barring employers “from asking about or considering, for purposes of hiring or any condition of employment, any information about the employee’s/applicant’s arrests, convictions or other proceedings involving juvenile court,” as The Recorder added. 

By Katy Grimes

SACRAMENTO — As the Legislature is about to recess for the summer, tax increase bills are the immediate focus. When the Legislature reconvenes August 5, it may not have a Democratic Supermajority. Several legislators won local elections and will be taking up their new positions, reducing the Democrats’ numbers below the two-thirds threshold.

Tax bills need a two-thirds vote of the Legislature to pass — and they are getting it.

AB 458, by Assemblyman Bob Wieckowski, D-Fremont, claims to prevent a tax loophole that allows companies to take a deduction when a court holds them liable for punitive damages.

“There has been much discussion recently about whether California corporations pay their fair share of taxes,” Wieckowski said in testimony today about AB 458, which I attended. “This bill does not attempt to address that issue, but it does take on one business tax deduction that I believe everyone can agree is logically indefensible. Punitive damages should not be tax deductible as ordinary and necessary business expenses.”

But Assemblywoman Shannon Grove, R-Bakersfield, a business owner, challenged the state practice of penalties to punish employers. “The law says employers have to list a specific address for the employer’s bank on paychecks, or the state imposes a $50 per-employee penalty on the employer,” she said. “We punitively punish employers in this state to the point they are all leaving.”

Grove identified  numerous other ridiculous requirements on employers, all passed by the Legislature. “I urge a ‘no’ vote and ask you to stand up for business owners.”

Unique and strict California wage and hour laws

“It’s a stretch to say a tax on business owners is not putative,” said Assemblyman Brian Jones, R-Santee. “In the United States, California ranks as the least business-friendly state in the nation. And California ranks as one of the least legal-friendly in the nation.”

Jones called the bill “nonsense.” That rankled the lawyers in the Assembly.

“Penalties are not putative damages,” said Assemblyman Roger Dickinson, D-Sacramento, a lawyer. “Putative damages are imposed by a judge and jury,” he added, appearing to split hairs. “Why would we give a tax break to someone who oppresses or does something constituting fraud?”

“It does not balance our budget,” Wieckowski said. “It will raise only $400,000 in additional revenue a year.” He said businesses assessed punitive damages have committed “some reprehensible action.”

AB 458 passed the Assembly with the two thirds necessary, 54-24, on a party-line vote.

By Katy Grimes

A recent decision by the federal Equal Employment Opportunity Commission is about to undo many decades of law, while taking rights away from employers–again.

Using the well-worn “level the playing field” adage, the EEOC just ruled 4-1, that employers cannot use a criminal background check, or a job applicant’s criminal record, when making an employment decision.

Criminals now have more employment protections than law-abiding citizens.

Under the very rule of law they have violated, those with criminal records are now the tail wagging the dog thanks to the federal government.

The EEOC said that while employers may legally consider criminal records in some hiring decisions, maintaining a hiring policy that excludes all applicants with a conviction record is a  violation of employment discrimination laws because it could have a “disparate impact on racial and ethnic minorities, who have higher arrest and conviction rates than whites.”

The EEOC also “recommends” that employers not ask about past convictions on job applications.

In a nutshell, to the EEOC, it is discrimination that ethnic minorities have higher conviction rates than whites, and employers be damned.

Read for EEOC decision for yourself:

“In the last twenty years, there has been a significant increase in the number of Americans who have had contact³ with the criminal justice system⁴ and, concomitantly, a major increase in the number of people with criminal records in the working-age population.⁵ In 1991, only 1.8% of the adult population had served time in prison.⁶After ten years, in 2001, the percentage rose to 2.7% (1 in 37 adults).⁷ By the end of 2007, 3.2% of all adults in the United States (1 in every 31) were under some form of correctional control involving probation, parole, prison, or jail.⁸ The Department of Justice’s Bureau of Justice Statistics (DOJ/BJS) has concluded that, if incarceration rates do not decrease, approximately 6.6% of all persons born in the United States in 2001 will serve time in state or federal prison during their lifetimes.⁹

Arrest and incarceration rates are particularly high for African American and Hispanic men.¹⁰ African Americans and Hispanics¹¹ are arrested at a rate that is 2 to 3 times their proportion of the general population.¹² Assuming that current incarceration rates remain unchanged, about 1 in 17 White men are expected to serve time in prison during their lifetime;¹³ by contrast, this rate climbs to 1 in 6 for Hispanic men; and to 1 in 3 for African American men.¹⁴

Employers have few tools left with which to judge job applicants, particularly entry-level or unskilled job seekers. In California, background checks already cannot be used unless there is a job-related reason.

However, any employer seeking to hire a driver, heavy equipment operator, or a manager, needs to know who they are dealing with, and whether the applicant has any legal skeletons hiding in their closets.

An employer seeking to hire a bookkeeper has every legal right to know if that bookkeeper has an embezzlement conviction before making a job offer.

10 years ago when I worked as a Human Resource manager, I discovered that a part-time accounting department employee had been quietly embezzling from the company. She was very clever. She had hacked into the payroll system and hid her theft by increasing her vacation accruals and payouts, and added extra hours onto her paycheck every two weeks. It wasn’t until she got greedy that she got caught because the amounts were small.

My company prosecuted and won a civil judgment against her. The purpose was to hopefully prevent any future employer from hiring her in a position handling money, or with access to financial accounts. And the judgement would prevent her from obtaining a professional license in California.

This was no school girl prank–this young woman knew what she was doing and had very carefully covered her tracks.

With the new EEOC ruling, this woman, who always managed to obtain jobs handling money, or with access to bank accounts, could get another such job.

The EEOC has just given a huge gift to employment lawyers. What a surprise. Even with the EEOC “recommendations,” lawyers can and will file lawsuits against employers anytime someone with a criminal record feels discriminated against during a job interview, whether there is evidence or not.

An employer may fight a charge of discrimination. “During an EEOC investigation, the employer also has an opportunity to show, with relevant evidence, that its employment policy or practice does not cause a disparate impact on the protected group(s).”

However, the EEOC also states “An employer’s evidence of a racially balanced workforce will not be enough to disprove disparate impact.”

But employers must hire legal counsel in order to defend charges of discrimination. And legal fees add up quickly when dealing with government agencies.

Employers are under assault in America, and California employers have been under siege for decades. It has gotten to the point where an employer must keep a law firm on retainer to fight off the hundreds and hundreds of legal assaults just waiting to happen.

The rule of law has just been greatly degraded, and disgraced, again.

An already precarious business climate in the state is about to get worse.

The San Francisco Human Rights Commission voted unanimously this week to join the Reentry Council of San Francisco and send a letter to the San Francisco Board of Supervisors and Mayor Ed Lee “urging them to develop and enact legislation to prohibit discrimination in San Francisco against people with prior arrest and/or convictions.”

Because it is difficult for convicted criminals to find jobs and housing, the Commission is pushing San Francisco officials to instead make criminals out of business owners for asking a perfectly appropriate question during a job interview: “Have you ever been convicted of a crime?”

“The Commission heard testimonies from citizens that have prior arrest and convictions records. They testified to the difficulty they face in securing housing and employment in San Francisco after completing their sentences,” the letter stated.

It’s not so unreasonable that the employer who provides the paycheck, medical benefits, pays employment taxes, workers compensation insurance, and social security for the prospective employee would want to know a little bit about the applicant.

I worked as a Human Resources Manager for more than 20 years and can attest to the vast restrictions on employers surrounding employment law procedures and policies. Running a criminal background check on prospective employees has become a standard employment procedure for more than 80 percent of U.S. employers, according to the Society for Human Resource Management.

People who have screwed up are supposed to pay a price. It’s a long climb back to legal society after committing a crime, and not supposed to be easy.

Lawyers have tied the hands of employers so severely, that many job applicants now volunteer information in order to set themselves apart from less desirable applicants.

At the urging of a labor attorney, I used to give job applicants a short written questionnaire attached to the job application which asked about a criminal record. This gave the  applicant a chance to explain any situation in which there was a criminal conviction. Most often, applicants with any criminal record usually had minor drug conviction, which was not a deal killer at our company.

What is left out of most news reports is how many private sector employers offer convicted criminals a second chance. My company was not the exception. While we would give the job applicant a chance to straighten out a past lapse in judgment, there was only one chance given, and only for non-sexual, non-violent crimes. Violent criminals had to reform elsewhere.

Preventing employers from learning about the criminal convictions of job applicants is in direct conflict with OSHA laws as well as other state and federal labor laws requiring all employers to provide a safe workplace.

Once again, the burden has been placed on employers with conflicting laws because of differing political agendas. What are employers supposed to do, and does anyone in government even care?

Connecticut, Hawaii, Massachusetts, Minnesota, and New Mexico, and the cities of Atlanta, Baltimore, Chicago and Philadelphia have already instituted policies making it illegal for employers to inquire about job applicants’ criminal convictions, chipping away at the importance of accountability, and respect for the law.

Most people outside of San Francisco already think that its politicians are stark raving mad. Attempts to ban circumcision, a ban on the Happy Meal and fast food toys, plastic bags, pet goldfish, styrofoam, cell phone radiation laws, and attempts to stop “impulse purchases” are proof. Even prostitutes in San Francisco “are not obliged to make change for bills larger than $50.”

And now employers will not be able to ask job applicants about prior criminal records.

The utopian, liberal insanity has spread throughout California like a fungus in a locker room shower, usually originating in San Francisco, Berkeley or Davis.

And while the batty utopian types are dreaming up new ways to level the playing field for California’s deadbeats, failures and social victims, the taxpayers are going broke or moving out of state.

I am beginning to think that the weather anywhere else in the world is better than California’s.

The Human Rights Commission will be conducting a hearing on Monday June 25 from 4:00 p.m. to 7:00 p.m. at San Francisco City Hall.

JULY 22, 2011