Episode 126: Key Labor Law Bills to Watch This Year

Welcome to the Workplace, a podcast by Cal Chamber. I'm Erica Frank, Cal Chambers executive vice president and general counsel. And joining me on the podcast today are Ashley Hoffman, Cal Chambers, policy advocate for labor and employment issues, and Chris McKayley, a lobbyist and partner in the Apria & McKayley government relations firm in Sacramento. Welcome to you.

Both. Thanks, Erica. Happy to be.

Here. Thank.

You. It's actually always lovely to have the two of you on the podcast because you provide some insider information about what's happening in the Legislature. Last week, the legislature wrapped up work for their summer break. So I thought it would be a great idea to have you all on so that we can get a glimpse of where things stand right now with respect to labor and employment bills and and those workplace safety bills that are still alive and will be considered when lawmakers go back to the Capitol in a few weeks. So, Chris and Ashley, what are some of those bills that are still moving? What should employers be looking out as we head into the.

Fall? Well, Erica, if you don't mind, I wanted to interject before we get into what's left with just noting quickly what is not happening this year. Now, to be fair, we may face one or more of these proposals that failed early earlier this year in January when the Legislature returns for the 2022 session. But I wanted to start with that just so that your listeners can see what has been on the docket so far and what has been defeated. For example, 10 days of bereavement leave with a private right of action to enforce it, about $6 billion worth of bonuses to health care workers. Another bill, two additional sick days. Employers, no matter their size, was waylaid this year. There was an effort to expand FIHA to include individuals with familial responsibilities. Not quite sure what that means today, a 60 hour child care requirement for employers to cover and of course, one of my favorites, a public shaming bill based upon certain metrics. And so those didn't happen. They're not going to happen this year, but they could next year. As a little bit of an outsider, certainly to Cal Chamber, I wanted to give a little shout out to your organization's efforts in leading the business community on fighting a lot of these proposals that I just highlighted that will not happen this year. And in particular, my dear colleague Ashley Hoffman, who's done a great job this year in leading a lot of employer coalitions, not just on the bills that failed, but the ones that we're going to talk to on the talk with your listeners on this podcast. So with that that we'll jump into some of the.

Bills. Fantastic. So, Ashley, take it.

Away. Thanks. Thank you, Chris. I do want to say it definitely takes a village. You know, obviously we're happy to do what we can, but couldn't have done it without a lot of other interest holders, lobbyists, Republicans, Democrats, you know, that we were able to kind of join forces with on some of these bills. So definitely it took a village. And someone put it earlier this year, it took all the villages on some.

Movies. So definitely on some of those bills it.

Did. So anyway, you know, moving on to some of the bills that are still Left, you know, two of our job killers are still standing. SB62 by Senator Durazzo, while it only affects the garment manufacturing industry, we do have significant concerns about it as the potential precedent that it could set. You know, I do want to acknowledge that we, of course, acknowledge that every worker should be paid according to California law and that it's inexcusable that there are businesses out there that do not do that. But you know, of this bill, what it does is it expands joint several liability for every wage claim that a worker could potentially be owed to really anyone in the supply chain of a garment, even if they have no control over those workers or anything, if they're just a licenser. There's also no guardrails in the bill as far as that joint liability. So if a worker works on a shirt associated with your business one time and then is subsequently not paid properly on a different project, you're still liable under the bill for those wages. So we do have significant concerns about that as well as just thinking that really the issue here is increased enforcement needs as well as enforcement of the registration process that exists in that.

Industry. Could I just interject on SB62? I know as you highlighted, it's specific to the garment manufacturing industry, but this is one of those ones that is precedent setting. And I think a lot of other industries are keeping a close eye on it. Obviously highlighted the joint and several liability for wage violations. It seems to me a number of years ago we worked with one of your predecessors on labor code section 2810.3, dealing with joint and several liability. And in fact, you know, we have it for certain wage violations. We also have it for lack of worker comp. Coverage. But legislators keep building upon those types of things. And I also find a little bit troubling in this bill some of the limitations on the ability of employers to fight the alleged wage violations in the Labor Commissioner hearings. And so, as you noted, this bill is potentially precedent setting and could be expanded to other industries next year or a few years down the.

Road. You're absolutely correct, Chris. For example, there's another bill out there, SB727 this year that would expand some of the joint liability in the construction industry and it does not go, I'd say, nearly as far as this one does. We have concerns with that bill as well, but this is pretty unprecedented and I don't think some of the members have quite realized just how precedent setting it would be. And the other job killer that we have left is AB616. This is for the agricultural industry. It would essentially enact card check for union elections in that industry. It was painted as a mail invalid option. But we know some folks, once they actually read the bill, said, hey, this isn't mail in voting, this is card check. And some declined to be a co author for that reason. Or we're hearing that maybe some folks are regretting being a co author because it was portrayed in a different manner to what it really is. So that one got out of appropriations and will be heard sometime likely on the floor in August or September.

The other bill, that is again industry specific, AB 1074, this would apply to the hotel industry. If you're thinking, oh, didn't the hotel industry just get a bill applied to them a couple months ago, you're correct. SB93 instituted a COVID19 right to recall requirements that was narrower than the bill that was vetoed by Governor Newsom last year. Would be 3216, which was also a cow chamber job killer, again targeting the hotel industry. It would make it so that where a hotel contracts for a service and decides to switch contractors, that subsequent contractor would be required to actually hire all of the prior contractors employees. It's based on a program or a law applicable to janitors from about 20 years ago. So we have large concerns about the applicability of that really in the hotel setting, the ability for then especially small hotels, B&Bs to attract contractors if that becomes a rule. So a lot of concerns.

There. This is another example of precedent setting, as you noted, two dozen years ago or so, maybe slightly less when it was created for the janitorial industry. And of course, when we hear the author present this year's version, it's portrayed merely as a slight expansion of that. And the janitorial one has been quote, unquote, unquote working well all these years and therefore this expansion should as.

Well. Right? Yeah. But you know the breadth of what it would apply to is quite alarming. So we have a lot of concerns, you know, that it's not small expansion, it's actually quite a large expansion. I don't know Chris, before I go into some of the others, do you want to maybe touch on the workplace safety.

Bills? Yeah, there are a handful of Cal OSHA related bills that are out there that are of concern. Some former job killers that have been modified but that are still alive, including Senate Bill 606 by Senator Lena Gonzalez from Long Beach. It expands Cal OSHA authority and enforcement opportunities by creating a new category in the Labor Code called an egregious employer, which sounds pretty onerous but is one of those amorphous definitions. And also the bill would create the these enterprise wide violations for citations for employers and establishes a new legal process and enforcement mechanism within Cal osha. And so it's some very significant changes and duplicative in our mind in some instances. But employers across the board have to be aware of it if it ultimately goes through. And this is one where we could also see regulations being adopted by the Cal OSHA Standards Board. And you know, we've been busy in the last year primarily on the COVID front with the Cal OSHA Standards Board and its adoption of regulations. Which leads me to Senate Bill 410 by Senator Connie Lava. This bill is a repeat from her same measure in 2017. So some of our listeners might recall it. This is a carve out a total exemption for Cal OSHA issued regulations from the so called Syria process, which is the acronym SRI, a standardized regulatory impact analysis. And in 2011 the legislature in a bipartisan fashion enacted a requirement for so called major regulations. And they defined it by statute as those estimated to cost in excess of $50 million to comply with. And it's across the board. Now what we found out is according to the Office of Administrative Law, there are about six regulations adopted every year. And this is everyone from Cal OSHA to the Department of Insurance and everyone in between. Well, about 10 or 12 of them are subject to that $50 million threshold. And the reason why that's important is because if you have that large of a regulation that could impact either the employer community or the regulated community, we want a more thorough fiscal and economic analysis. And that's what the Syria process is involved with. The labor folks and Senator Leyva are trying again four years later to simply say even for those big regulations, we don't want that information out there about what's the true economic impact. And so we're just going to say there is no Syria process necessary for any Cal OSHA regulations. And we really have been advocating that Cal OSHA should in fact have all of the information in front of them before they make any decisions on regulations that clearly have a very significant economic impact. One other item I should make mention of is Assembly Bill 654 by Eloise Reyes. This is, you might recall at the beginning of our program I mentioned a worker metric public shaming bill. Well, this is a variation of it and that's for employers who have so called Covid outbreaks. And I say so called because it's three or more. Now maybe if you have a five employee business, business three or more could be very significant. But if you have several thousand employees at your facility, maybe it's not much of a of an outbreak at all. But basically it would require that Cal OSHA or sorry in this case the Department of Public Health DPH to actually publicly list on its website businesses by business location where those outbreaks have occurred. A bill of very significant concern to the employer community up and down the state. It doesn't matter your size or industry sector, this could impact you. Now initially, the business community, again with a coalition led by one of Ashley's colleagues at the Cal Chamber, defeated this bill on the assembly floor. But last week the author of the bill made some very minor amendments and she's going to try it again during the last few weeks of the legislative session. So be sure to keep your eyes out for that bill as.

Well. Chris, going back to the public, the modified public shaming so to speak bill right Now, CDPH does have the authority under prior legislation to post the industries that have had major outbreaks. Same definition, three or more. So is this much more specific to the organization itself or the company.

Itself? Yeah, Erica, in this instance, the proposal by the author is for it to be site specific. As you're quite familiar with over the years, even our equal pay statute and disclosure about wage information. I think the Cal Chamber and the business community generally have always advocated for generalized information or industry specific, but not employer specific. And so you've always remained consistent. And that same position is applicable here with Assembly Bill 654 with that site specific information. There are instances, as you're probably familiar, where the employer has no control. In other words, we also see a distinction between if for example, the outbreak occurred at the workplace versus what happens if a worker.

Was infected by COVID 19, for example, outside the workplace and then came and spread it to two of his or her colleagues and then the employer is designated as having an outbreak and that's publicly listed. If it's a restaurant, for example, their customers might think, oh my gosh, everyone who works at 123 First St. Is infected by Covid when in fact there wasn't an issue at the employer's facility. Those people had contracted Covid outside the.

Workplace. Thanks for elaborating on that issue a little bit more. And it's certainly something that employers have been and working really hard to keep those exposure rates at zero in their workplaces. And as you just touched upon, what's very challenging for employers is that their employees are Most likely contracting COVID 19 outside of the workplace. Yet the employers do have to follow all of the rules and treat it as if it may have happened there. So as much as we all really want COVID 19 to be over, there are still some rules and regulations that still apply now. And it sounds like from what you've just reported on, there might be more in the future. So we'll definitely continue.

Keeping our eyes and ears on those bills. I think the two of you have one more bill to touch upon that many of our listeners may want to listen up to as it may be impacting their requirements as far as California Family Rights.

Act. Yeah, Erica, so I actually have two bills I wanted to talk on. One has to do with the California Family act and another on potential severance agreements. So AB 1041 is a bill that we used to be a job killer, but then due to amendments we removed that job killer tagged where it's going to allow an employee under the California Family Rights act, as well as under the paid sick leave statute to, in addition to the family members already listed, include a designation. So that can be, you know, any person of the employee's choosing, whether that's a friend, maybe a roommate, maybe a partner, you know, that you're not actually married to someone like that. The employer would have the ability to limit the employee to just one designated person per 12 month period. You know, just so people aren't, you know, designating, you know, five different people or something like that. But you know that that bill likely will pass legislature. So employers should definitely be aware of that going into next year that they are going to need to up update their policies as far as both of those laws go. And then I also just wanted to briefly touch on SB331. Employers may remember from a few years ago there were some changes made to statutes regarding settlement agreements. If there was claim or sexual discrimination or harassment or retaliation deriving from one of those and that you could not keep the facts of the underlying facts of that claim confidential in the settlement agreement. There's a bill, SB331, that's going to expand that to apply to every discrimination, retaliation or harassment claim, regardless of the type. And we have no objection to that piece of the bill. We're not opposed to that piece of the bill. But there is a second piece that we have concern about in that bill dealing with severance agreements. It's again, kind of along a similar vein. It's going to require employers not to be able to keep confidential any alleged facts about unlawful activity in a severance agreement. You know, we had expressed some concerns about how broad the language was. There were some amendments taken. However, there was an amendment that was not taken that we had requested that would have allowed employers to still keep the amount of the severance agreement confidential. You can keep the amount of a settlement severance settlement agreement confidential, but under this bill, potentially not severance, which is a little odd. And you know, we have fear that that would discourage employers right, from paying out severance. It may behoove them just to wait and see if a claim is filed because then they could keep that amount confidential. So we are seeking that last amendment still and are really trying to push for.

That. Great. And what were those two bill numbers again, Ashley, just so folks can jot it down one more.

Time? Yeah, absolutely. So the C4 paid sick leave designated person bill is AB 1041. And then that settlement severance agreement bill is SB.

331. Great, thank you. And Chris, did you have any more comments to make it look like you were going to be piping.

In?

Well, I just wanted to mention timing for your listeners. As you noted last week, the legislature went on its brief summer recess. They return on August 16th and adjourn on September 10th. And then the governor has 30 days to sign or veto bills, most of which take effect on January, January 1, if he signs them, unless those have an urgency clause. For example, AB654, the pseudo public shaming bill, does have an urgency clause. The other date that some of your listeners might about is August 26, which is when the fiscal committees decide which bills are going to go forward and onto the floors. And earlier this spring, the Cal Chamber led coalitions really saw a lot of their success, not just on the floor a week later, but there in the appropriations getting bills held because of the anticipated costs of implementation or enforcement of those bills. So we'll see a lot of action in late August and early September and then through the middle of October when the Governor acts on all these bills that we've been talking about.

Today. Great. Thank you for sharing that. And hopefully everyone will mark their calendar. It's always a busy time in the Legislature during those last few weeks of session as we see legislators scurrying to get their bills passed through the required committees and houses in time to reach the Governor's desk. So things will definitely get exciting as we move into the fall. So thank you, Ashley and Chris for joining us. And thank you for joining us on the Workplace. Please comment, share and subscribe to Cal Chambers podcast by visiting calchamber.com.