California Employment Law Updates: 12 Things to Know for 2022

The employment landscape has shifted — and not just in terms of employee satisfaction and retention. To keep employers protected, it’s important to stay abreast of California employment law updates in the upcoming year as well as cases and administrative opinions impacting future workplace activity.

Below are 12 of the most critical California employment law updates to keep in mind as you navigate the legal landscape in 2022:

This article was adapted from the information presented in the Woodland Hills Webinar – Is There a Light at the End of the Tunnel? The 2022 Employment Law Update! on January 20, 2022, with featured speaker by Karen Gabler, Esq. of LightGabler. 

Karen is an employment law attorney with LightGabler, an employment law firm with attorneys in Camarillo and San Luis Obispo. For almost 30 years, she has represented employers and managers in businesses of all sizes and industries in virtually all aspects of employment law.

1. COVID-19 

When it comes to COVID-19, guidance is continually shifting on everything from exposure reporting, to testing, to mandates. California employers can easily become overwhelmed by new developments and updated information. Cities or counties may have more restrictive ordinances than the state, and federal law applies unless California law is more restrictive. Companies can enforce their own vaccine requirements as long as they allow for religious or medical exemptions.

Employers must remain vigilant amid rapidly changing dynamics to ensure they remain in compliance with federal, state and local laws. 

2. Arbitration 

There was an AB 51 update regarding mandatory arbitration agreements. On September 15, 2021, a Ninth Circuit majority held that AB 51 did not violate the Federal Arbitration Act (“FAA”), because it dealt with pre-employment behaviors and allowed employees and applicants to choose to enter into arbitration agreements based on mutual consent. Nevertheless, the enforceability of mandatory arbitration agreements for applicants remains in limbo at this time.

It’s recommended that employers fairly draft and implement arbitration agreements with qualified employment counsel, as the updates can be complex and ever-changing.

3. Class Actions 

Class action lawsuits arose in several instances in 2021 surrounding misclassification of workers (Wilson v. The La Jolla Group, March 2021) and wage and hour complaints (primarily based on rounding and time spent waiting in security check lines) (Amaro v. Anaheim Arena Management, LLC, September 2021).

Unpaid time, meal and rest period violations, blended rates and rounding practices are hotly litigated right now, and more claims related to unpaid time going through COVID-19 health screenings will likely be coming. To avoid class action lawsuits, the best practices include having solid policies, having solid arbitration agreements with class action waivers and ensuring managers and employees are trained on workplace policies so the laws are enforced in practice and not just on paper.

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Complete the form below to download the full 2022 Employment Law Update document from Lightgabler, which includes 100 entries on new legislation and new case law for 2022.

4. Discrimination 

Discrimination is always a big issue in employee litigation. Recent cases include Rubio v. CIA Wheel Group (April 2021), Jorgensen v. Loyola Marymount University (September 2021), Mahler v. Judicial Counsel of Cal (July 2021), and Clark v. Superior Court (March 2021).

Among the most important practices employers can implement is to consistently prepare documentation. In the case of employee termination, documentation of performance problems and complaints help to prove that the termination was based upon legitimate business reasons. Additionally, the employer should prohibit and prevent discrimination in the workplace and anti-discrimination policies should be clearly stated and supported in the employee handbook.

5. Independent Contractors 

In Vasquez v. Jan-Pro Franchising International, Inc. (January 2021) the California Supreme Court confirmed that the new “ABC” test for independent contractors codified in AB 5 will be applied retroactively to claims arising after AB 5 was enacted.

With several layers of legal tests and complicated exceptions to contractor classifications, employers should review all contractor classifications with an employment attorney. Misclassification of independent contractors can carry significant liability with multiple state and federal agencies as well as civil claims.

6. Meal and Rest Periods 

Meal and rest periods are a consistent source of employment litigation. Last year was no exception, including a class action lawsuit around the tracking of meal breaks (Salazar v. See’s Candy Shops, Inc., May 2021) and 2018 lobbying efforts by the American Trucking Association and the Specialized Carriers and Rigging Association regarding trucking breaks.

It’s important to have solid policies and practices in place, and to ensure managers and employees are trained on those practices. Employees should have multiple resources where they can complain in case a particular supervisor is causing the problem, and the workplace should be audited regularly to ensure policies are being followed. Additionally, the law requires that meal breaks must be tracked in employee time records to ensure employees are taking their mandatory and protected breaks.

7. Leaves of Absence 

Last year, Governor Newsom signed SB 1383 into law, extending the reach of the California Family Rights Act (“CFRA”). As a result, the majority of California employers are now required to provide their qualifying employees with up to 12 weeks per year of unpaid job-protected leave for serious health conditions, family care and baby bonding.

While CFRA originally applied to employers with 50 or more employees, the new law applies to employers with five or more employees. Additionally, the CFRA definition of family member was amended for 2022 under AB 1033 sections 12945.2 and 12945.21 to clarify that “parent-in-laws” are covered under the list of family members for whom an eligible employee can take up to 12 weeks of CFRA job-protected time off from work.

Make sure to count employees located both inside and outside of California when determining whether you meet the “five or more employees” CFRA cutoff. Additionally, with the expanded family member definition, ensure there is thorough documentation along every step of the way to understand how and when this new guidance can be applied.

8. Sexual Harassment 

In the wake of the #MeToo movement, there has been a shift in legislation regarding settlement agreements and a widespread rejection of confidentiality requirements. SB 820 and SB 1300 prohibit settlement agreements that prevent disclosure of information related to sexual harassment, assault or discrimination based on sex. SB 331, the “Silenced No More Act,” takes those prohibitions a step further in also covering those protected under the Fair Employment and Housing Act.

Employees cannot be required to remain confidential on facts related to sex harassment or abuse. This year’s legislation extends that rule to most settlement agreements between employers and employees. Additionally, Employers must take employee complaints of harassment seriously and respond promptly to avoid liability.

9. Minimum Wage 

California minimum wage has risen incrementally in California, thanks to SB 3 signed into law by Governor Jerry Brown on April 4, 2016. That bill created groundbreaking legislation to increase California’s minimum wage to $15.00 per hour by 2022/2023.

It’s important to stay on top of the incremental minimum wage increases depending upon your company’s size — and remember that those increases also impact exempt workers, causing a corresponding increase in the minimum salary basis. Many cities and counties implemented their own minimum wage hikes as well, some of which exceed the state minimums.

Employers are strongly advised to check the local wage rules for each city or county in which they are located, as well as any city or county in which they do business.

10. Wage Theft 

AB 1003 added Penal Code Section 487m and expanded the definition of “grand theft” to now include, “… the intentional theft of wages in an amount greater than nine hundred fifty dollars ($950) from any one employee, or two thousand three hundred fifty dollars ($2,350) in the aggregate from two or more employees, by an employer in any consecutive 12-month period…”

While the amendment is clearly aimed at bad actors who are deliberately attempting to steal from their employees, employers can avoid misunderstandings about owed wages through detailed documentation. Pay close attention to wage and hour laws and consult with your employment law counsel to ensure your employees are being paid appropriately.

11. Service Animal Changes 

During the pandemic, many people who worked from home adopted new pets — and with the return to the office, employers are receiving many requests for accommodation of emotional support animals. Changes to AB 468 added California Health and Safety Code Sections 122317 – 122319.5, which give employers the ability to require more documentation and information from the employee before they allow such requests.

Emotional support animals do not have the rights and privileges accorded by law to a guide, signal or service dog, though California law provides for accommodation of both service animals and emotional support animals in the workplace. For emotional support animals, you can request a letter from a health care practitioner certifying the need for the animal in the workplace, and that practitioner must meet certain requirements.

12. State Retirement Plan 

SB 1234 created the “California Secure Choice Retirement Savings Program” (CalSavers), a state-managed retirement savings program for private-sector employees whose employers do not already provide a retirement savings program. The CalSavers program allows employees to contribute to a state-operated Roth IRA.

Employers with five or more employees that do not currently offer a retirement savings program must register with the CalSavers program by June 30, 2022. Larger employers should have registered in prior years.

Work with your employment law counsel to ensure your company is complying with the latest California employment law updates. Attorneys at LightGabler are well versed in providing employment advice and counsel to businesses of all sizes and industries. 

And to stay current on the trends shaping the future of work, be sure to attend the 2022 California HR Conference, which will bring together thousands of HR professionals this May 9-11 in person at the Anaheim Convention Center and online.