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Workers’ Compensation Reform

On September 30, 2016, California Governor Jerry Brown signed legislation (S.B. 1160) reforming the state’s workers’ compensation law. Specifically, the bill:

  • Requires that, if a physician or provider is criminally charged with workers’ compensation, Medi-Cal, or Medicare fraud, the physician or provider’s liens are stayed until the resolution of criminal charges.
  • For liens filed on or after January 1, 2017, requires the lien claimant to submit a declaration stating how the lien claimant qualified to file a lien.
  • Curbs workers’ compensation fraud by codifying the Chorn (2016) decision on lien assignments and prohibiting lien assignments on or after January 1, 2016.
  • Prohibits the use of financial incentives for a physician, based on a Utilization Review (UR) decision, and gives the Division of Workers’ Compensation (DWC) the authority to review UR compensation information.
  • Increases the minimum penalty for failing to report workers’ compensation data to the Workers’ Compensation Information System (WCIS) from $5,000 to $10,000.
  • Starting January 1, 2018, eliminates prospective UR in the first 30 days of an accepted claim if the medical treatment follows medical guidelines and is under the employer’s control, as specified.
  • Requires that, on or before July 1, 2018, all UR processes must be accredited by an independent, nonprofit organization.
  • Requires that, on or before July 1, 2018, employers will need to submit UR plans to the DWC for approval of their UR process.
  • Requires that all UR documentation be submitted to the DWC in an electronic format, allowing for the creation of a comprehensive UR database.
  • Modernizes the UR /Independent Medical Review (IMR) timelines to include the upcoming formulary (July 1, 2017) for medicine in the workers’ compensation system.
  • Updates the existing Medical Treatment Utilization Schedule (MTUS) in the workers’ compensation system and links the MTUS with the upcoming formulary by creating an alternative public hearing process for MTUS updates.

Read CA S.B. 1160

Wage Discrimination – Race or Ethnicity

On September 30, 2016, California Governor Jerry Brown signed legislation (S.B. 1063) amending state law regarding wage discrimination.

Existing California law prohibits an employer from paying any of its employees at wage rates less than the rates paid to employees of the opposite sex for substantially similar work — when viewed as a composite of skill, effort, and responsibility, and performed under similar working conditions — unless the employer demonstrates that specific, reasonably applied factors account for the entire wage differential.

Senate Bill 1063 would also prohibit an employer from paying any of its employees at wage rates less than the rates paid to employees of another race or ethnicity for substantially similar work, as specified above.

The bill goes into effect on January 1, 2017.

Read CA S.B. 1063

Wage Discrimination – Use of Prior Salary Information

On September 30, 2016, California Governor Jerry Brown signed legislation (A.B. 1676) amending existing state law regarding wage discrimination.

Current California law prohibits an employer from paying an employee at wage rates less than those paid to employees of the opposite sex in the same establishment for equal work on jobs requiring equal skill, effort, and responsibility, and which are performed under similar working conditions. The law provides exceptions to that prohibition, including, among others, where the payment is made based on any bona fide factor other than sex, such as education, training, or experience.

Assembly Bill 1676 specifies that prior salary cannot, by itself, justify any disparity in compensation under the bona fide factor exception to the prohibition.

The bill goes into effect on January 1, 2017.

Read CA A.B. 1676

Workers’ Compensation Fraud and Abuse

On September 30, 2016, California Governor Jerry Brown signed legislation (A.B. 1244) regarding workers’ compensation fraud and abuse. The bill requires the Administrative Director of the Division of Workers’ Compensation to suspend any physician, practitioner, or provider from participating in the workers’ compensation system if that person has been convicted of any felony or misdemeanor involving fraud or abuse of the Medi-Cal program, Medicare program, or workers’ compensation system or the license has been suspended for fraud or abuse.

The bill goes into effect on January 1, 2017.

Read CA A.B. 1244

Employee Safety – Heat Regulations for Indoor Workers

On September 29, 2016, California Governor Jerry Brown signed legislation (A.B. 1732) requiring the Division of Occupational Safety and Health to propose to the Occupational Safety and Health Standards Board, by January 1, 2019, a heat illness and injury prevention standard applicable to workers working in indoor places of employment.

Read CA S.B. 1167

Single-User Restrooms

On September 29, 2016, California Governor Jerry Brown signed legislation (A.B. 1732) requiring all single-user toilet facilities in any business establishment, place of public accommodation, or government agency to be identified as all-gender toilet facilities. The bill also authorizes inspectors, building officials, or other local officials responsible for code enforcement to inspect for compliance with these provisions during any inspection.

The bill goes into effect on March 1, 2017.

Read CA A.B. 1732

Secure Choice Retirement Savings Program

On September 29, 2016, California Governor Jerry Brown signed legislation (S.B. 1234) implementing the Secure Choice Retirement Savings Program for private-sector workers without a retirement plan.

Senate Bill 1234 requires employers with five or more employees — that do not provide their own pension, 401(k) plan, or similar retirement program — to automatically enroll employees in an individual retirement account with an initial default contribution rate of 3 percent, which could ultimately increase to 8 percent. This requirement will be phased in over three years, starting with businesses that have 100 or more employees. After three years, businesses with five or more employees will need to comply.

Employers will also have the option to start their own retirement plan. Employees can choose to opt out. For the first three years of the program, the Secure Choice plan would establish managed accounts invested in U.S. Treasuries, or similarly low-risk investments. During that startup period, it is expected the Secure Choice Retirement Savings Investment Board would develop other investment options to be rolled out after the initial time period.

The bill goes into effect on January 1, 2017 and authorizes the build-out of Secure Choice.

Read CA S.B. 1234
Read the Governor’s Press Release

Prevailing Wage – Apprentices on Public Works Projects

On September 28, 2016, California Governor Jerry Brown signed legislation (A.B. 1926) amending the state’s prevailing wage law.

Assembly Bill 1926 provides that travel time (time spent traveling to and from the required activity) by apprentices on public works must be paid at the prevailing wage. The bill also provides that, unless otherwise provided by a collective-bargaining agreement, a contractor is not required to compensate an apprentice for the time spent on pre-employment activities if the apprentice is required to take a pre-employment drug or alcohol test and he or she fails to pass that test.

The bill goes into effect on January 1, 2017.

Read CA A.B. 1926

Unfair Immigration Related Practices

On September 28, 2016, California Governor Jerry Brown signed legislation (S.B. 1001) amending state law regarding unfair immigration related practices by employers.

Senate Bill 1001 makes it an unlawful immigration practice for an employer to:

  • Request more or different documents than are required under federal law.
  • Refuse to honor documents tendered that on their face reasonably appear to be genuine.
  • Refuse to honor documents or work authorization based upon the specific status or term of status that accompanies the authorization to work.
  • Reinvestigate or reverify an incumbent employee’s authorization to work.

The bill also provides a penalty of up to $10,000 for violations.

The bill goes into effect on January 1, 2017.

Read CA S.B. 1001

Employment Discrimination – Exemptions From FEHA

On September 27, 2016, California Governor Jerry Brown signed legislation (A.B. 488) that authorizes individuals employed under a special license in a nonprofit sheltered workshop or rehabilitation facility to bring an action under the Fair Employment and Housing Act (FEHA) for prohibited harassment or discrimination. The bill also provides an affirmative defense for employers.

Read CA A.B. 488

Use of Criminal History Information

On September 27, 2016, California Governor Jerry Brown signed legislation (A.B. 1843) amending state law regarding the use of criminal history information by employers.

Assembly Bill 1843 prohibits an employer from asking an employment applicant to disclose, or from utilizing as a factor in determining any condition of employment, information concerning certain criminal processes while a person was subject to the juvenile court process and jurisdiction. The bill also provides that the term “conviction” excludes an adjudication by a juvenile court or any other court order or action taken with respect to a person who is under the jurisdiction of the juvenile court law.

In addition, the bill prohibits an employer at a health facility from inquiring into specific events that occurred while the applicant was subject to juvenile court law, with a certain exception, and from inquiring into information concerning or related to an applicant’s juvenile offense history that has been sealed by the juvenile court. The bill requires an employer at a health facility seeking disclosure of juvenile offense history under that exception to provide the applicant with a list describing offenses for which disclosure is sought.

The bill goes into effect on January 1, 2017.

Read CA A.B. 1843

Use of Electronic Devices While Driving

On September 26, 2016, California Governor Jerry Brown signed legislation (A.B. 1785) amending state law regarding the use of wireless electronic devices while driving.

Current California law prohibits a person from driving a motor vehicle while using an electronic wireless communications device to write, send, or read a text-based communication, unless the electronic wireless communications device is specifically designed and configured, and is used, to allow voice-operated and hands-free operation.

Assembly Bill 1785 repeals the above prohibition and instead prohibits a person from driving a motor vehicle while operating a wireless telephone or electronic wireless communications device unless the device is specifically designed for and used in a voice-operated and hands-free manner. The prohibition does not apply to manufacturer-installed systems that are embedded in the vehicle.

The bill goes into effect on January 1, 2017.

Read CA A.B. 1785

Palo Alto Minimum Wage to Increase to $15 by 2019

On September 26, the Palo Alto City Council unanimously approved raising the minimum wage to $15 per hour by 2019 to bring Palo Alto in alignment with other cities in Santa Clara County. The council followed the recommendation by the Cities Association of Santa Clara County that called for the increase to be phased in, in a three-step process over three years:

  • Effective January 1, 2017, the minimum wage increases to $12 per hour.
  • Effective January 1, 2018, the minimum wage increases to $13.50 per hour.
  • Effective January 1, 2019, the minimum wage increases to $15 per hour.

Included in the recommendation is a Consumer Price Index (CPI) increase after 2019 indexed to the Bay Area CPI, with a five percent cap and no exemptions.

The city’s current minimum wage of $11 per hour wasn’t set to increase to $15 per hour until 2025. California’s state minimum wage is currently $10 per hour and will increase to $10.50 on Jan. 1, 2017.

Read the Press Release

Employment Contracts – Choice of Law and Forum Provisions

On September 25, 2016, California Governor Jerry Brown signed legislation (S.B. 1241) regarding choice of law and forum provisions in employment contracts. Senate Bill 1241 prohibits employers from requiring an employee who resides and works in California, as a condition of employment, to agree to a provision that either:

  • Requires the employee to adjudicate outside of California a claim arising in California; or
  • Deprives the employee of the substantive protection of California law with respect to a controversy arising in California.

Any such provision is voidable by the employee. If such a provision is rendered void at the employee’s request, then the matter must be adjudicated in California and California law will govern the dispute.

This bill provides a specified exception to these provisions for any employee who is in fact individually represented by legal counsel in negotiating the terms of an agreement and otherwise authorizes a court to award a plaintiff enforcing his or her rights under this bill attorney’s fees, as specified

The bill applies to contracts entered into, modified, or extended on or after January 1, 2017.

Read CA S.B. 1241

Appeal of Wage Law Violations

On September 25, 2016, California Governor Jerry Brown signed legislation (A.B. 2899) regarding appeals of wage law violations. The bill requires that, prior to filing an appeal of a decision by the Labor Commissioner relating to a violation of wage laws, employers must post a bond with the commissioner which covers the unpaid wages and damages owed to employees.

The law goes into effect on January 1, 2017.

Read CA A.B. 2899

Commercial Online Entertainment Employment Service Providers – Age Information

On September 24, 2016, California Governor Jerry Brown signed legislation (A.B. 1687) regarding commercial online entertainment employment services providers. Commercial online entertainment employment service provider means a person or business that owns, licenses, or otherwise possesses computerized information, including, but not limited to, age and date of birth information, about individuals employed in the entertainment industry, including television, films, and video games, and that makes the information available to the public or potential employers.

Current California law requires a business that owns, licenses, or maintains personal information about a California resident to implement and maintain reasonable security procedures and practices appropriate to the nature of the information, to protect the personal information from unauthorized access, destruction, use, modification, or disclosure. Current law also provides penalties for violations of these provisions.

Assembly Bill 1687 prohibits a commercial online entertainment employment service provider that enters into a contractual agreement to provide specified employment services to an individual paid subscriber from publishing information about the subscriber’s age in an online profile of the subscriber. The bill also requires the provider to remove certain information on any companion Internet Web site under the provider’s control if requested.

The law goes into effect on January 1, 2017.

Read CA A.B. 1687

Public Employment – Preference in Interns and Student Assistants

On September 21, 2016, California Governor Jerry Brown signed legislation (A.B. 1840) requiring state agencies, when hiring for internships and student assistant positions, to give preference to homeless youth and formerly incarcerated youth. Current California law only allows preference to persons who are, or have been, dependent children in foster care.

The bill also requires any application for an internship and student assistant position with a state agency to allow the applicant to identify that the applicant is eligible for these preferences, but would prohibit the application from requiring the applicant to identify the specific category that entitles him or her for eligibility.

The law goes into effect on January 1, 2017.

Read CA A.B. 1840

Employment Protections for Crime Victims

On September 14, 2016, California Governor Jerry Brown signed legislation (A.B. 2337) amending state law which provides employment protections for crime victims.

Current California law prohibits an employer from discharging or in any manner discriminating or retaliating against an employee who is a victim of domestic violence, sexual assault, or stalking for taking time off from work for specified purposes related to addressing the domestic violence, sexual assault, or stalking. Current law also provides that any employee who is discharged, threatened with discharge, demoted, suspended, or in any manner discriminated or retaliated against in the terms and conditions of employment by his or her employer because the employee has taken time off for those purposes is entitled to reinstatement and reimbursement for lost wages and work benefits caused by the acts of the employer, as well as appropriate equitable relief, and is allowed to file a complaint with the Division of Labor Standards Enforcement within the Department of Industrial Relations.

Assembly Bill 2337 requires employers to inform each employee of his or her rights established under those laws by providing specific information in writing to new employees upon hire and to other employees upon request. The bill also requires the Labor Commissioner, on or before July 1, 2017, to develop a form an employer may elect to use to comply with these provisions and to post it on the commissioner’s Internet website. Employers are not required to comply with the notice of rights requirement until the commissioner posts the form.

The law goes into effect on January 1, 2017.

Read CA A.B. 2337

Workers’ Compensation – Requests for Payment

On August 26, 2016, California Governor Jerry Brown signed legislation (S.B. 1175) amending the state’s workers’ compensation law regarding request for payment. Senate Bill 1175 requires, for services on or after January 1, 2017, that:

  • Requests for payment with an itemization of services provided and the charge for each service be submitted to the employer within 12 months of the date of service or within 12 months of the date of discharge for inpatient facility services.
  • All bills for medical-legal evaluation or medical-legal expense be submitted to the employer within 12 months of the date of service in the manner prescribed by the administrative director.

Requests for payment and bills for medical-legal charges are barred unless timely submitted.

Read CA S.B. 1175