2023 Labor and Employment UPDATE

by Audrey Gee, David Marchiano and Marissa Boyd

In a time of great social change, 2023 brings some key new equity-focused employment legislation:

In the wake of the United States Supreme Court’s decision in Dobbs v. Jackson Women’s Health Organization, 597 U.S. ___, 142 S.Ct. 2228 (2022) last June (overturning Roe v. Wade, limiting the federal constitutional right to abortion, and leaving legislation on such reproductive rights to the states), California amended its State Constitution to explicitly provide for the right to reproductive freedom and abortion.

Dobbs also spurred California to further expand protections for reproductive rights explicitly in the workplace:

• SB 523: Beginning on January 1, 2024, the new “Contraceptive Equity Act” will, among other things: (1) amend the Fair Employment Housing Act (the “FEHA”) to prohibit discrimination against employees and job applicants for their “reproductive health decision-making”; (2) require that employer-provided healthcare plans cover overthe-counter contraceptives and prohibit those plans from imposing cost-sharing methods, such as deductibles or copayments, for vasectomies.

• AB 2223: Beginning on January 1, 2023, a person can no longer be subject to criminal or civil liability based on their actions or omissions with respect to their pregnancy or actual, potential, or alleged pregnancy outcome, or be liable for aiding a pregnant person in exercising their rights under the Reproductive Privacy Act.

• AB 2134: Beginning on January 1, 2023, if a religious employer provides healthcare coverage that does not cover abortion and contraceptives, employees must be provided with written information about the abortion and contraceptive services that may be available to them through the California Reproductive Health Equity Program.

Over the past years, California has made efforts to address pay equity in gender and race, through legislation such as Labor Code section 432.3, which prohibits asking for applicant’s prior salary history and Government Code section 12999, which requires providing pay scales upon an applicant’s reasonable request, and is now mandating more transparency in pay scales. Beginning on January 1, 2023, SB 1162 significantly expands these pay scale disclosures and pay data reporting obligations and requires:

• All employers, upon request, to provide a pay scale to current and prospective employees.

• Disclosure of pay scales in job postings (for companies with 15+ employees).

• The wage data reports (for companies with 100+ employees) (including employees through labor contractors) must include the median and mean hourly rate for each combination of race, ethnicity, and sex within each job category for employees (reporting requirements begin May 2023).

• The retention of records of job titles and wage rate histories for each employee for the duration of the employee’s employment and three years after the end of employment.

Since 1966, large employers (over 100 employees) have EEO-1 reporting requirements for pay data showing gender and ethnic representation in different occupational classifications. According to the EEOC, such data has been invaluable in enforcing workplace anti-discrimination laws. Labor contractors, however, were not covered, which led to the increase of the use of such contractors due to the less stringent requirements. SB 1162 closes this loophole and now requires reporting by labor contractors.

On December 7, 2022, President Biden signed the “Speak Out Act,” which makes pre-dispute non-disparagement and non-confidentiality clauses unenforceable in connection with sexual assault or harassment disputes. Blanket provisions entered into “before a dispute arises” (often found in non-disclosure agreements, assignment and invention confidentiality agreements, employment, arbitration, and pre-dispute severance agreements) will not be enforceable in sexual assault or sexual harassment cases brought under federal, tribal, or state law. The Speak Out Act applies to all claims filed on or after December 7, 2022.

The Speak Out Act is the latest in the string of “Me-Too” in the workplace laws passed by Congress. In 2022, the “Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act” was also enacted under federal law, which bans pre-dispute arbitration agreements and joint-action waivers covering sexual assault or sexual harassment disputes.

California has already been a leader in this area. Last year’s Silenced No More Act (SB 331) prohibits confidentiality in severance agreements (except for the severance amount) and prevents gags on discussing unlawful acts in the workplace, such as harassment or discrimination following the earlier STAND Act prompted by the #MeToo movement.

On December 29, 2022, as part of the 2023 Omnibus Spending Bill, President Biden signed two new federal laws expanding the rights of pregnant and breastfeeding employees.

Effective June 27, 2023, the Pregnancy Workers Fairness Act, requires employers with 15+ employees to provide reasonable accommodations to “qualified employees” (i.e., those who can perform the essential functions of the position) with the “known limitations” related to pregnancy, childbirth, or related medical conditions, unless the employer can show the accommodation would impose an undue hardship.

Effective April 28, 2023, the Providing Urgent Maternal Protections for Nursing Mothers (PUMP) Act, amends the Fair Labor Standards Act and requires employers with 50+ employees to provide a reasonable break time for nursing employees to express breast milk each time the employee needs to express milk, for up to one year after the child’s birth. Employers must provide a clean and

private space (other than a bathroom) to express milk. Both hourly and salaried employees are now protected.

Beginning on January 1, 2023, AB 2282 expands the definition of hate crimes in places of employment to include the display of hate symbols.

As of January 1, 2024, AB 2188 will amend FEHA to prohibit employers from discriminating against employees’ use of cannabis off the job and away from the workplace. Employers may take adverse action against applicants for failing a preemployment drug screen, but only so long as the test does not screen for “nonpsychoactive cannabis metabolites.” Employers may continue to take adverse action against an employee (i.e., terminate, write up, suspend, warn, send home) for on-the-job possession, impairment, or use of cannabis. These provisions do not apply to employees in building and construction trades, and do not preempt state or federal laws requiring employees to be tested for controlled substances.

Under the California Family Rights Act (“CFRA”), covered employers must provide eligible employees up to 12 workweeks in any 12-month period for family care and medical leave. Under the Healthy Workplaces, Healthy Families Act of 2014 (California Paid Sick Leave), California employers must provide paid sick leave to eligible employees for care, or treatment of an existing health condition, or preventive care for, an employee or an employee’s family member.

Effective January 1, 2023, AB 1041 expands the protection of these laws, to care for a “designated person.” Under CFRA, this is defined as “any individual related by blood or whose association with the employee is the equiva lent of a family relationship.”

Under California Paid Sick Leave, a designated person is defined as “a person identified by the employee at the time the employee requests paid sick days” and does not require that the person be related by blood or affinity (as under some local paid sick leave laws) or be “the equivalent of a family relationship.” Under both laws, the employee may identify the designated person at the time they request leave (they do not have to designate the person in advance) and employers may limit an employee to one designated person per 12-month period.

In July 2022, the Department of Fair Employment and Housing changed its name to the “Civil Rights Department” (“CRD”) (SB 189) https:// calcivilrights.ca.gov. While the Department will retain its existing powers, this change was implemented to create more public awareness of its mission, and “to more accurately reflect the Department’s powers and duties, which include enforcement of laws prohibiting hate violence, human trafficking, discrimination in business establishments, and discrimination in government-funded programs and activities, among others.” According to CRD Deputy Director of Executive Programs Adam Romero, the pandemic gave rise to an increase of hate violence and its prior name was an obstacle to people accessing its services.

Audrey Gee (agee@bgwcounsel.com), David Marchiano (dmarchiano@bgwcounsel.com), and Marissa Boyd (mboyd@ bgwcounsel.com) practice employment law at Brown, Gee & Wenger, LLP in Walnut Creek and defend employers in wage and hour class actions and PAGA cases, individual discrimination and harassment cases, in addition to providing advice and counsel on HR policies and risk management workplace matters. www.bgwcounsel.com and (925) 943-5000.