New Legislation to Take Effect in 2021

It’s hard to believe that the New Year is already among us, and a new year means new legislation for businesses to prepare for. Below are a few noteworthy laws taking effect on January 1, 2021:

Minimum Wage
In accordance with the timeline established by SB 3 (Leno), which was signed in 2016 by California’s previous Governor Jerry Brown, the state’s minimum wage will increase by one dollar until it reaches $15.00/hr for all employees in 2023. At that point, “the rate will be adjusted annually for inflation based on the national consumer price index for urban wage earners and clerical workers (CPI-W).” This year, the new minimum wage rates are as follows:

For employers with 25 employees or less, minimum wage will go up to $13.00/hr.
For employers with 26 employees or more, minimum wage will go up to $14.00/hr.

Labor Code section 1182.12 defines “employer” as: “any person who directly or indirectly, or through an agent or any other person, employs or exercises control over the wages, hours, or working conditions of any person [and] includes the state, political subdivisions of the state, and municipalities.” Employees are considered to be “any individual performing any kind of compensable work for the employer who is not a bona fide independent contractor… including salaried executives, part-time workers, minors, and new hires.” The Labor Commissioner’s FAQ page regarding these increases can be found here.

AB 685 (Reyes)
AB 685 creates a notice requirement at the workplace if an employee is exposed to COVID-19, with “exposed” defined as, “exposure to a person with any of the following”: (1) “a positive COVID-19 test,” (2) “a COVID-19 diagnosis,” (3) “a COVID-19-related order to quarantine” or (4) “a fatality that was caused by COVID-19.” The employer must notify exposed employees within one business day of the exposure as well as the employees’ rights to sick leave and other COVID-19 related policies. The bill requires an employer, if the employer or representative of the employer is notified of the number of cases that meet the definition of a COVID-19 outbreak, within 48 hours, to report prescribed information to the local public health agency in the jurisdiction of the worksite. The bill also requires an employer that has an outbreak to continue to give notice to the local health department of any subsequent laboratory-confirmed cases of COVID-19 at the worksite. To review our KSC Update regarding AB 685, click here.

AB 979 (Holden)
AB 979 states that a publicly held domestic or foreign corporation whose principal executive offices are in California shall have at least one director from an underrepresented community on its board no later than 12/31/2021. The bill further establishes that no later than 12/31/2022, those corporations shall comply as follows:

A corporation with four or less directors have at least one director from an underrepresented community.
A corporation with more than four but fewer than nine directors have a minimum of two directors from underrepresented communities.
A corporation with nine or more directors have a minimum of three directors from underrepresented communities.

“Director from an underrepresented community” is defined as “an individual who self-identifies as Black, African American, Hispanic, Latino, Asian, Pacific Islander, Native American, Native Hawaiian, or Alaska Native, or who self-identifies as gay, lesbian, bisexual, or transgender.”

“Publicly held corporation” is defined as “a corporation with outstanding shares listed on a major United States stock exchange.”

SB 1383 (Jackson)
The California Family Rights Act (CFRA), makes it an unlawful employment practice for an employer with 50 or more employees to refuse to grant a request by an employee to take up to 12 workweeks of unpaid protected leave during any 12-month period to bond with a new child of the employee or to care for themselves, a child, a parent, or spouse. SB 1383 amended the CFRA to make it unlawful for any employer with five or more employees to refuse to grant a request by an employee to take up to 12 workweeks of unpaid protected leave during any 12-month period to bond with a new child of the employee or to care for themselves or a child, parent, grandparent, grandchild, sibling, spouse, or domestic partner. This expansion creates an inconsistency with the federal Family and Medical Leave Act (FMLA), which also provides employees of employers with 50 or more employees with up to 12 weeks of unpaid, job-protected leave per year. This means employees of employers with 50 or more employees could take up to 24 weeks of unpaid, job-protected leave per year. To review our KSC Update regarding SB 1383, click here. View Update