• Extension of reduction in S corporation recognition period for built-in gains tax
• Extension and modification of bonus depreciation
• Extension and modification of increased expensing limitations and treatment of certain real property as Section 179 property
• Extension of temporary minimum low-income housing tax credit rate for non-Federally subsidized buildings
• 100 percent exclusion for Qualified Small Business stock made permanent

California and the Federal Government Have Revamped COVID-19 Leave Options

As employees are getting vaccinated and more folks are headed back to the office, it is important to make sure you are complying with the most recent set of COVID related leave laws. On March 11, 2021, the federal government passed the American Rescue Plan Act which renews and expands the FFCRA (Families First Coronavirus Response Act) on a voluntary basis. The FFCRA allows employers (fewer than 500 employees) to provide paid time off to employees for COVID-19 related reasons. The tax credits associated with the FFCRA have been extended as well.

In addition, on March 19, 2021, California passed a New Supplemental Paid Sick Leave for COVID-19. This act requires employers (employers of 26 or more employees) to provide employees with leave similar to the paid sick leave portion of the FFCRA, including for taking time off to get vaccinated.

Furthermore, on February 2, 2021, the City Council for the city of Santa Rosa voted to extend its emergency paid sick leave ordinance to mirror that of the FFCRA. Santa Rosa’s paid sick leave ordinance is applicable to all employers of any size within the city limits. Moreover, with the passing of the American Rescue Plan Act, the ordinance is also now effective through September 30, 2021.

EMERGENCY PAID SICK LEAVE

Leave Amount: Full-time employees are entitled to up to 80 hours of paid sick leave if the employee is unable to work (or telework) due to COVID-19 related reasons identified below. Part-time employees are entitled to a pro-rata portion of leave defined by statute.[1] This is in addition to sick leave already provided by the employer.

Qualifying Reasons: Qualifying reasons for this paid sick leave are:

Employee is subject to a quarantine or isolation period related to COVID-19 as defined by federal, state, or local orders or guidelines.

Employee is advised by a health care provider to self-quarantine due to concerns related to COVID-19.

Employee is attending an appointment to receive a COVID-19 vaccine.

Employee is experiencing COVID-19 vaccine-related symptoms that prevents the employee from being able to work or telework.

Employee is experiencing COVID-19 symptoms and seeking a medical diagnosis.

Employee is caring for a family member who is subject to a quarantine or isolation order or guideline or who has been advised to self-quarantine by a health care provider due to concerns related to COVID-19.

The covered employee is caring for a child whose school or place of care is closed or otherwise unavailable for reasons related to COVID-19 on the premises.

Pay Available for Qualified Reasons: The following pay is available to the employee.

Paid sick leave must be paid at 100% of the employee's regular rate of pay up to 80 hours.

Weekly payments are based on the employees work schedule.

Payments are capped at $511 per day and $5,110 total.

Other Available Paid Leave: Employees are not required to use other types of paid leave provided by the employer before the employee uses the paid sick time available under these laws. Employees are permitted to use other sick, or vacation pay for these purposes if they choose to do so.

If the employer has adopted a separate COVID-19 sick leave bank for employees to use for these qualified reasons, the employer may credit any time given between January 1 and March 29, 2021, against the California Paid Sick Leave mandate. This includes employers who have provided such leave in compliance with the Santa Rosa City Ordinance, or any other local ordinance requiring such.

Similarly, if an employer has opted to continue providing paid time off under the FFCRA, any time given in 2021 may be credited toward the California Paid Sick Leave mandate.

Effective Date: Sick leave under the FFCRA renews on April 1, 2021. The California paid-sick leave provisions take effect January 1, 2021 and expire on September 30, 2021.

Requests for Retroactive Pay by Employees: Employees may request the employer pay for time taken between January 1, 2021 and March 29, 2021. Once requested, the employer must pay for any qualifying time taken, or pay any difference between paid time given and the California Paid Sick Leave pay calculation by the next payroll date.

Pay Statement Reporting: Employers must report the amount of available California Paid Sick Leave to employees on their pay statements or on a separate report to employees issued with payroll. The identification must be separate from any other leave available.

For employees who work inconsistent shifts, the employer may make a best estimate of the number of hours a part-time employee is entitled to receive by reporting such calculation and identifying the amount is “variable.” When the part-time employee then requests leave, the employer must calculate the amount of time available to the employee and report that information to the employee.

Interaction with Cal-OSHA Mandated Paid Leave: The California Mandatory Paid Sick Leave Act is payable first before the employer is required to pay any benefits owed to employees under the recent Cal/OSHA Emergency Temporary Standards (“ETS”). Under the ETS, employees must be paid if they are out of work due to an exposure to COVID-19 at work.

EXPANDED FMLA UNDER THE FFCRA 

Expansion: The new Emergency Family and Medical Leave Expansion Act is similar to the prior Emergency FMLA expansion from 2020 but goes further to expand the reasons for leave and the amount of leave available. This leave allows eligible employees who cannot work (or telework) because of any of the 7 reasons stated above, to take up to 12 additional weeks off in addition to the two weeks described above. This is part of the expanded FFCRA and therefore, employers may voluntarily opt to grant this leave.

Eligibility: All employees who have been on the payroll for at least 30 calendar days are eligible.

Duration: The duration of the leave is up to 12 weeks in a 12-month period. If the employee has taken any FMLA leave, or Emergency FMLA leave under the prior COVID-19 laws, then such leave will count against the amount of available leave when taken in the same 12-month period. If an employee has already taken all 12 weeks of FMLA leave in a 12-month period, then no leave is available until sufficient time has passed. 

Paid Leave: Employees receive two-thirds of their regular rate of pay based on the number of hours the employee would otherwise have been scheduled to work. These paid-family-leave benefits are capped at $200 a day and $12,000 total. Employees may choose to supplement their pay by using accrued sick leave or vacation during the time off.

Effective Dates: The expanded FMLA provisions take effect April 1, 2021 and expire on September 30, 2021.

SUPPORTING DOCUMENTATION, ENFORCEMENT & RETALIATION 

Under both laws, the employer may ask for documentation to support the leave. Documentation is required in order to maintain payroll tax credit eligibility under ARPA. Furthermore, documentation may be requested in response to California’s Supplemental Paid Sick Leave law when the employer has other information indicating that the requesting employee is not requesting leave for a valid purpose.

If an employer refuses to provide the California paid sick leave, an employee may file an action in court. The court can award attorney’s fees if an employee prevails in court. Employers cannot retaliate against employees for requesting or taking paid sick leave or Expanded FMLA leave if voluntarily offered to employees.

TO DO

Send notice to employees: Form notices are available on the Department of Industrial Relations’ website: https://www.dir.ca.gov/dlse/2021-COVID-19-Supplemental-Paid-Sick-Leave.pdf If you are opting to offer FFCRA leave, you should include notice of those benefits as part of the same communication.

Contact your payroll provider to work on getting the separate bank reflected on employee payroll statements

Prepare for workflow changes, especially if you opt in to the FFCRA, as an employee could be out for up to 14 weeks due to a qualifying reason.

If you have any legal questions or concerns, please call Dawn Ross, Samantha Pungprakearti, or Justin Hein at Carle, Mackie, Power & Ross LLP at (707) 526-4200.

[1] Part‐time employees are eligible for variable leave amounts based upon hours worked. A worker who has a normal weekly schedule is entitled to paid leave hours equaling the total number of hours they are scheduled to work over two weeks. An individual who works a variable number of hours is eligible for leave time equal to 14 times the average number of hours the individual worked each day in the six months before the leave date. The calculation for a worker employed less than six months is generally made over the entire period of employment.

In a long-watched case, the California Supreme Court issued an opinion this week addressing how the use of private electronic devices intersects with the Public Records Act. In this case, San Jose v. Superior Court, a resident objected to a redevelopment project and submitted a request for public records under the Public Records Act to the City of San Jose.  The request included all emails and text messages sent or received by city employees or officials on private devices. The trial court ruled that communications about public business, sent on private devices, were subject to disclosure.  The Court of Appeal disagreed and said they are not.  The California Supreme Court reversed, holding that substantive communications about public business are subject to disclosure under the California Public Records Act, even if the communication is sent or stored on a private device. 

The California Constitution gives citizens a right to access information concerning the conduct of the public’s business by mandating that public officials’ writings “shall be open to public scrutiny.”  The Public Records Act, a state statute, declares that access to information concerning the public’s business is a fundamental and necessary right belonging to every person in California.  This statute must be broadly construed to provide access to the public and narrowly construed when limiting the public’s access to records.  Essentially, all public records are subject to disclosure unless there is a stated, or express, exemption from disclosure. 

As the Supreme Court observed, in these modern times with multiple devices, email accounts, text messages, and other electronic platforms, the lines between an official communication and an electronic aside can be blurry.  The sometimes difficult job of distinguishing between an official communication and an aside requires looking at the content, context, purpose, intended audience, and author of the communication; as opposed to where the communication was stored or on whose device it was sent.  Communications that substantively relate to the conduct of the public’s business must be disclosed under the Public Records Act, unless an exemption to disclosure applies.  Conversely, primarily personal communications that only incidentally mention agency business do not need to be disclosed.  Thus, a writing – which includes text messages and emails sent or stored on personal devices or email accounts – substantively related to the conduct of the public’s business, is subject to disclosure under the Public Records Act.   

The Court stated this result is necessary in order to ensure open access to government communications so that the public can verify that public officials are acting responsibly and are accountable to the public.  This result also prevents public officials from evading the Public Records Act by simply switching devices or email accounts. 

The Supreme Court considered employee privacy issues and provided guidance on how public agencies can comply with the Public Records Act when records are on a public employee’s or official’s private device or email account.  When this occurs, the focus should be on the content of the communication, not its location.  Agencies can adopt policies addressing how to handle these situations and they can require employees or officials to copy their government accounts for all communications involving the public’s business.  When responding to a request for public records, the agency may rely on the employee or official to search their personal files for responsive materials.  This respects an individual’s privacy rights while responding to the request for public records. For materials and communications stored on private devices or accounts that are not disclosed, the official or employee may provide an affidavit, containing sufficient facts to show that the materials being withheld are not public records.  The Court was careful to explain that it was not endorsing any particular search method, but was merely providing guidance to agencies struggling with this issue. 

We now have clarity - anyone substantively interacting with a state or local agency in California about the conduct of the public’s business should assume that the communication is a disclosable public record, irrespective of how the communication occurs or where it is stored. 

Please do not hesitate to contact Tina Wallis at twallis@cmprlaw.com or (707) 526-4200 if you have questions or concerns regarding this article.

Now that we are back from the holidays, it's time to dust off the employee handbook, review your policies and procedures, and make sure they are compliant with the new employment laws taking effect in 2017.  This year, we have a combination of new laws, and existing laws that have been updated with additional protections.

1. California Minimum Wage Raised – On January 1, 2017, employers of 26 or more employees must pay $10.50 per hour as the minimum wage.  Employers of less than 26 employees will not be required to raise the minimum wage to $10.50 until beginning January 1, 2018.  Action: Review your pay policies to ensure they meet the minimum wage requirements.  Please note that many cities and counties in California have passed higher minimum wage requirements (Berkeley, Cupertino, El Cerrito, Emeryville, Los Altos, Los Angeles City and County, Malibu, Mountain View, Oakland, Palo Alto, Pasadena, Richmond, San Diego, San Francisco, San Jose, San Leandro, San Mateo, Santa Clara, Santa Monica and Sunnyvale). 

2.  Federal Salary Basis Adjustment – Under state and federal law, employees may be deemed exempt from overtime if their positions meet certain criteria, including salary paid above a set rate.  In May of 2016, the DOL amended the federal rule to increase the minimum salary requirement from $455 per week to $913 per week ($47,476/year) exceeding the minimum salary set by California.  This new salary minimum was scheduled to go into effect on December 1, 2016.  However, the rule change was put on hold while the question of whether the DOL exceeded its authority in making this new rule is litigated.  The DOL may end up withdrawing the rule when the new administration takes over.  Thus, the California minimum salary requirement of two times the minimum wage (now $41,600 for employers under 26 people and $43,680 for larger employers) remains in effect.  Action: Ensure your pay policy meets the minimum salary requirement for all exempt employees as the minimum wage increases.  Also, keep an ear out for any policy shifts from the DOL as the administration changes. 

3. Change to the I-9 Form – The government has issued a new I-9 form that must be used beginning January 1, 2017 for all new employees.  The form is available online at the USCIS website: www.uscis.gov/i-9 

4. California’s Legalization of Recreational Marijuana Use – With the passage of Proposition 64, California now allows people over the age of 21 to smoke or ingest marijuana, grow up to 6 plants and transfer up to 28.5 grams of marijuana without compensation.  Employers may implement policies limiting the use of marijuana by their employees, up to and including total prohibition.  Action: (i) Confirm your company’s stance on employee marijuana use (both on and off the clock); (ii) review your employee handbook to make sure it is consistent with your position; (iii) make necessary changes to the handbook; and (iv) communicate those changes to employees. 

5. Trade Secrets [Handbook Edits Suggested] – In May of 2016, a federal law was created governing trade secrets, which supplements existing California law.  The federal law is substantially similar to the laws in California, but provides a better mechanism for immediate relief from trade secret misappropriation, along with the ability to seek punitive damages and reasonable attorney’s fees and costs.  Action: To take advantage of the new federal law, employers must notify their employees that whistleblowers of trade secret violations will receive criminal and civil immunity against claims of trade secret misappropriation so long as the report was made confidentially to a federal, state or local government official, an attorney or under seal in a lawsuit.  The inclusion of this notice into new agreements governing confidential information or trade secrets and in handbooks is voluntary, but makes these significant additional remedies available to the employer. 

6.  Notice Required of Leave Available for Victims of Domestic Violence, Sexual Assault or Stalking [Handbook Edits  Required] – Several years ago, Labor Code 230.1 was enacted, requiring employers of 25 or more employees to provide time off to victims of domestic violence, sexual assault or stalking to obtain medical attention, obtain services from a shelter or program, counseling or to plan for their safety.  Beginning in 2017, employers are required to notify new employees of certain rights under this law.  Current employees need only be notified of their rights upon request. Action: Employers must notify new employees of several rights under the law: (1) that the employer prohibits retaliation against employees who use this leave, (2) that employees can use vacation, sick or any other time off they are already entitled to, and (3) that the right does not extend the amount of time off they are entitled to under the FMLA.  The Labor Commissioner will be creating a form for employers to use for this purpose.  In lieu of the form, handbooks can include the required language. 

7.  Single-Occupant Restrooms Must Be Identified as “All-Gender” – By March 1, 2017, all business establishments that have single-user toilet facilities are required to change the sign to identify the restroom as “all-gender” and conform generally with normal signage requirements.  

8.  Venue and Choice of Law – Labor Code section 925 now prohibits employers from obligating California-based employees to sign agreements that require lawsuits to be brought outside of California or under other states’ laws, if the employee “primarily” works in California.  This new law expands California’s right to adjudicate disputes between employers and employees.  Previously, out of state employers could insert terms into their employment contracts applying their home state’s law and forums, making it difficult for California employees to sue their employer.  Action: Review your employment contracts for any offending language and amend them to identify California as the choice of venue and law for California employees. 

9.  EEOC Defines Rules Regarding National Origin Discrimination – The federal EEOC implemented new guidelines that are similar to California law.  The EEOC prohibits discrimination based on “national origin.”  The guidelines state that the place of origin can be a country, former country, or geographic region closely associated with a particular national origin group. National origin discrimination includes discrimination based on:

• Ethnicity: A person can not be discriminated against because he or she either belongs, or doesn't belong, to a particular ethnic group;

• Physical, linguistic, or cultural traits: Subjecting a person to adverse employment action due to his or her accent, style of dress, or other traits associated with a certain origin may constitute discrimination;

• Perception: Regardless of a person's actual origin, if he or she is discriminated against due to the belief that he or she is of that origin;

• Association: A person's association with someone of a particular national origin (for example, his or her spouse or child);

• Citizenship: Employers may not make hiring decisions based on an applicant’s status as a citizen or permanent resident (other than the fact that the applicant must be legally able to work in the U.S.). 

Employers must have a legitimate business reason for making employment decisions based on accents, such as: (1) the ability to communicate in spoken English is required to perform job duties effectively; and (2) the individual's accent materially interferes with job performance.  There must be a legitimate business reason to make decisions based on fluency, if it is necessary for the effective performance of the position.  Finally, “English-only policies” are only legal if they are required to promote safe and efficient job performance or business operations, and are only enforced for those purposes.  Action: Review handbook language and other management training documents to ensure they are compliant with the law. 

10.  Workers’ Compensation Coverage Exclusions Narrow for Business Owners – Previously, officers, directors and working partners were not required to be covered by a company’s Workers’ Compensation (WC) policy unless they opted in for coverage.  Beginning January 1, 2017 (and including in-force policies), officers, directors and partners are required to be covered unless they meet the narrow exception to allow them to opt out. For corporations, only corporate officers and members of the Boards of Directors who own 15% or more of the issued and outstanding stock of a corporation may opt out of WC. General partners of partnerships and managing members of limited liability companies can also opt out of coverage.  This law is intended to prevent employers (usually in high risk industries) from giving employees a small (e.g., 1%) ownership interest to avoid paying Workers’ Compensation insurance premiums. Action: contact your WC insurance carrier to ask for details on the new rules and for an opt in/opt out form.  

Change on the Horizon:  Agricultural Workers Right to Overtime Phase In Beginning 2019-AB 1066.  The overtime rules for agricultural employees working for employers with 25 or more employees are changing beginning January 1, 2019.  Agricultural workers who work more than 9.5 hours per day and/or 55 hours per week will be entitled to 1.5 times their regular hourly rate.  The law will continue to roll-out between 2020 and 2025 until the overtime rules are in alignment with those for non-agricultural employees.  Action: No action is required this year.  However, we encourage agricultural employers to review their policies and increase their staffing if necessary to ensure they will be ready when the law goes into effect on January 1, 2019. 

Have a great 2017, and please contact Dawn Ross or Samantha Pungprakearti for help with your labor and employment law needs - (707)526-4200; dross@cmprlaw.com; or spungprakearti@cmprlaw.com 

A number of key employment bills were signed into law by Governor Jerry Brown at the close of the 2016-2017 legislative session. The bills take effect January 1, 2018, unless noted otherwise. In addition, some prior legislation takes effect this year.  Here’s what you need to know about the top ten:

 1. Minimum Wage: While not a new law, this year brings the next step from the 2013 law that increased minimum wage over a period of years.  Beginning January 1, 2018, all hourly employees need to be paid at least $11.00/hr. ($10.50 for employers with 25 employees or less), and all salaried exempt employees need to be paid at least 2x minimum wage ($45,760/year for full time employees).  In addition, a number of California cities have their own, higher, minimum wage.  TO DO: Review and update your hourly rate, and check to make sure all your salaried employees are making at least 2x the new minimum hourly rate.

2. Ban the Box (Gov. Code §12952):  Section 12952 amends the California Fair Employment and Housing Act (FEHA), which prohibits an employer from engaging in various forms of discriminatory employment practices.  The amendment creates new state-wide restrictions on the use of criminal history in making hiring decisions.  It restricts public and private employers' ability to make pre-hire and other employment decisions based on an applicant's or employee's criminal history, including a "ban the box" element. The new law makes it unlawful for an employer with 5 or more employees:

• to include on any application for employment any question that seeks the disclosure of an applicant’s conviction history;
• to inquire into or consider the conviction history of an applicant, including any inquiry about conviction history on an employment application, until after the employer has made a conditional offer of employment; and
• to consider, distribute, or disseminate information related to specified prior arrests not followed by conviction, referral to or participation in a diversion program, and convictions that are sealed, dismissed, expunged or statutorily eradicated .

Employers who intend to deny a position of employment solely or in part because of an applicant’s conviction history must make an individualized assessment of whether the applicant’s conviction history has a direct and adverse relationship with the specific duties of the job that justify denying the applicant the position, including: i) the nature and gravity of the offense or conduct; ii) the time that has passed since the offense or conduct and completion of the sentence; and iii) the nature of the job held or sought.  The employer must then provide the applicant with written notification of the decision under a specified procedure, including a right to respond.  TO DO: Delete questions about “have you ever been convicted of a felony” from your job applications and interview outlines.

 3. Salary History Inquiries are Prohibited (Labor Code §432.3): Newly enacted Section 432.3 prohibits employers, including state and local governments, from seeking an applicant's salary history information and/or relying on salary history in deciding whether to offer employment, or what salary to offer an applicant. The bill does not prohibit an applicant from voluntarily, and without prompting, disclosing salary history information, or prohibit an employer from considering or relying on voluntarily disclosed salary information (which seems contradictory).  But remember that Labor Code §1197.5 already prohibits an employer from using an applicant’s salary history, by itself, to justify a pay disparity.  The new statute is intended to narrow the gender (and race) wage gap by preventing employers from relying on an applicant's prior salary, compensation, and benefits as factors in determining whether to offer employment or what salary to offer. This new law also requires employers to provide the position's pay scale to applicants upon reasonable request.  TO DO: Delete questions regarding salary history from your job applications and interview outlines.

4. Recreational Marijuana is Here:  Proposition 64 legalized adult-use of recreational marijuana in California effective January 1, 2018.  That does not mean employers have to condone use in the workplace.  Proposition 64 expressly provides that employers may prohibit marijuana in the workplace, and will not be required to accommodate an employee’s use of marijuana.  This is consistent with the Supreme Court’s holding in Ross v. RagingwireTelecommunications, Inc., in 2008, which addressed the use of medical marijuana under California’s Compassionate Use Act, which conflicts with federal law.  Stay tuned, as this is likely not the last of this discussion.  TO DO: Review and update your drug and alcohol policy.

5. Protecting Employees From Immigration Enforcement In the Workplace: AB 450 adds three new sections to the Government Code and two new sections to the Labor Code.  It is designed to protect immigrant employees from workplace immigration raids, but could also put employers in the uncomfortable position of choosing between complying with federal law or state law. Subject to exceptions required by federal law, AB 450 prohibits employers from granting voluntary consent to immigration enforcement agents to:

• Enter any non-public areas at a place of labor, except with a warrant; or
• Access, review, or obtain employee records, without a subpoena or court order.

The law also requires employers to notify current employees in a posted notice in the language they speak, within 72 hours of receiving a Notice of Inspection of I-9 Employment Eligibility Verification forms or other employment records (using a Labor Commissioner template).  Employers must also provide the results of such an inspection to current affected employees and any affected employee's authorized representative. The law further prohibits employers from re-verifying the employment eligibility of a current employee at a time, or in a manner, not required by federal law. Penalties for violation of this law range from $2,000 to $5,000 for a first violation and from $5,000 to $10,000 for subsequent violations.  (See, Government Code sections 7285.1, 7285.2, 7285.3; Labor Code sections 90.2, 1019.2.)  TO DO: Call your legal counsel if you are contacted by immigration enforcement agencies.

6. Parental Leave for Small(er) Employers (Gov’t Code §12945.6): SB 63 amends the FEHA to expand the California Family Rights Act (CFRA) protections for baby bonding leave to smaller employers. The law requires employers with 20-49 employees to provide 12 weeks of baby bonding leave to eligible employees. The law applies to employees with more than 12 months of service with the employer, who have at least 1,250 hours of service with the employer during the previous 12-month period, and who work at a worksite in which the employer employs at least 20 employees within a 75 mile radius.  Employers must maintain and pay for coverage under a group health plan for employees who take this leave, but can recoup it if the employee does not return to work.

The law also authorizes the California Department of Fair Employment and Housing (DFEH) to create a parental leave mediation pilot program. Under the pilot program, within 60 days of receipt of a right-to-sue notice, an employer may request all parties to participate in the department’s Mediation Division Program. If the employer makes such a request, an employee is prohibited from pursuing a civil action until mediation is complete, which would include an employee’s election not to participate in mediation. The employee’s statute of limitations would be tolled during the course of the mediation. (See Government Code section 12945.6.)  
TO DO: Update your employee handbook if you have 20-49 employees.

7. Harassment Training Expanded to Cover Gender Identity, Gender Expression, and Sexual Orientation (SB 396): The California Fair Employment and Housing Act (FEHA) requires employers with 50 or more employees to provide training and education regarding sexual harassment to all supervisory employees every two years. Under SB 396, this prescribed training must now include content addressing harassment based on gender identity, gender expression, and sexual orientation. Employers must also display a poster developed by the Department of Fair Employment and Housing regarding transgender rights in a prominent and accessible location in the workplace. (See Government Code sections 12950, 12950.1; Unemployment Insurance Code sections 14005, 14012.)  TO DO: Update your training outline.

8. Additional "Whistleblower" Retaliation Protections (SB 306): SB 306 amends Labor Code §98.7, and adds three Labor Code sections authorizing the Labor Commissioner's office to investigate an employer, with or without receiving a complaint, when during a wage claim or other investigation, it suspects retaliation or discrimination.   

It also authorizes the Labor Commissioner or an employee to seek immediate injunctive relief from a court allowing the employee to be reinstated pending resolution of the claim, upon a finding of "reasonable cause" that the law has been violated. The Labor Commissioner may also issue citations directing specific relief. (See Labor Code sections 98.7, 98.74, 1102.61, 1102.62.)

 9. Employee Assistance After Terrorist Attacks Expanded (Labor Code §4600.05):  Newly enacted Labor Code section 4600.05, provides new Workers’ Compensation protections to employees who are injured in the course of employment by an act of domestic terrorism.  In the event the Governor declares a state of emergency, it requires employers to provide injured employees with immediately accessible advocacy services to:

• assist injured employees in obtaining medically necessary medical treatment; and
• assist providers of medical services in seeking authorization of medical treatment.

These advocacy services may be provided by the employer, the employer’s insurer, or the employer’s claims administrator.  This Legislation arose out of the struggle for treatment experienced by victims of the San Bernardino terrorist attack of 2015.  TO DO: Contact your insurance provider should these circumstances arise.

10. Human Trafficking Notice (Civil Code §52.6):  Section 52.6 requires certain types of businesses to post a notice regarding human trafficking and assistance hotlines. It has been amended to extend the posting requirement to hotels, motels, and bed and breakfast inns.  Separate legislation requires new language in the notice to state that a person can text a specified number for services and support.  TO DO:  Post this notice if you operate a hotel, motel or inn.

A FEW SIGNIFICANT CASES FROM 2017 & THE TRENDS THEY REPRESENT

1. Augustus v. ABM Security Services, Inc. & Vaquero v. Stoneledge Furniture – If you have employees who work alone, or work on commission, make sure they are compensated separately for rest periods and relieved of all responsibilities, or pay a one hour penalty for each violation at the time it occurs.  
2. Lopez v. Friant & Associates, LLC – Make sure your paystubs have all nine pieces of information required by Labor Code 226(a), as even inadvertent mistakes, with no damage to the employees, will subject an employer to costly PAGA penalties.
3. Mendoza v. Nordstrom, Inc. – While employees can volunteer to work on the seventh day of rest, employers must “maintain neutrality,” and not do anything to encourage it. 

Have a great 2018, and please contact Dawn Ross or Samantha Pungprakearti for help with your labor and employment law needs - (707) 526-4200 or dross@cmprlaw.com or spungprakearti@cmprlaw.com. 

Britain’s decision to leave the European Union (“EU”) raises a number of issues for current and prospective owners of trademarks in the EU and the UK. 

Prior to June 23, 2016, an applicant for an EU Trademark (“EUTM,” previously known as a “Community Trademark” or “CTM”) could rely upon a single application to obtain ownership of a registered EUTM, which provides trademark protection in the UK and 27 other European countries.  By virtue of the Brexit vote, however, the UK has triggered a process by which recognition of trademark rights under the EU system may no longer extend to the UK. 

For registered EUTMs, the protections currently afforded to such marks in the UK are expected to remain intact for at least two more years, while the EU and UK negotiate the terms of the UK’s exit from the EU.  Thus, for existing EUTM owners, no immediate change in the status of your UK trademark rights is expected.    

Ultimately, and subject to the outcome of the Brexit negotiations, each registered EUTM may be divided into two trademarks: (1) a new, stand-alone trademark in the UK, and (2) the pre-existing “mother” EUTM covering the remaining EU member states.  This approach would preserve the prior rights and priority dates previously established under the pre-Brexit EUTM registrations. 

For parties filing new EUTM applications after June 23, 2016, and who also seek to obtain trademark protection in the UK, such applicants should file separate EUTM and UK trademark applications to ensure that they have adequate trademark protection.  Because the UK and EU will remain signatories to the Madrid Protocol, new applicants seeking trademark protection in the US, the UK, and the EU can continue to rely upon the Madrid Protocol’s “one application” approach to apply for and obtain trademark registrations in each of those jurisdictions. 

Please do not hesitate to contact John B. Dawson atjdawson@cmprlaw.com or (707) 526-4200 if you have questions or concerns regarding this historic event and the impact it may have on your international trademark rights. 

On April 20, 2016, CMPR obtained an across-the-board victory on behalf of International Fruit Genetics, LLC (“IFG”) in a case involving termination of licensing agreements for proprietary table grape varieties. The United States District Court, Central District of California, granted summary judgment in favor of IFG, holding that IFG validly terminated the parties’ licensing agreements based upon defendants’ contractual violations. The court also denied defendants’ separate motion for summary judgment on defendants’ counterclaims. International Fruit Genetics, LLC v. P.E.R. Asset Management Trust, et al., (Case No. 14-5273). 

IFG develops and owns proprietary hybrid table grape varieties in the United States and around the world. After developing a new grape variety, IFG applies for patents and other intellectual property registrations for the new variety in the U.S. and other countries. IFG licenses its proprietary grape varieties to authorized growers around the world under a licensing program designed to strictly control the propagation of its proprietary plant material and protect IFG’s intellectual property. 

Pursuant to three licensing agreements with IFG, defendants were permitted to test and make limited plantings of certain IFG grape plants in South Africa. However, the agreements prohibited defendants from propagating IFG grape plants. After learning that defendants had wrongfully propagated those plants, and had illegally imported other IFG plant material into South Africa, IFG gave notice terminating the parties’ agreements. In July 2014, IFG filed this lawsuit to confirm the validity of its termination based upon defendants’ contractual violations and other wrongful conduct. The CMPR team of John Dawson, Rick O’Hare, and Kim Corcoran co-authored the winning briefs. 

If you have any questions regarding intellectual property issues, please do not hesitate to contact John Dawson, head of the CMPR Intellectual Property Group (tel: 707-526-4200; email:jdawson@cmprlaw.com.)

Wineries and Growers were both Well-Dressed and Organized at Monday Night’s Sonoma County Public Forum.

Much has already been written about the “nuts and bolts” of the November 16th meeting, but the energy and determination that permeated the room was remarkable..  The meeting was the one and only chance for the public to finally have its say in response to the hours and hours of meetings held by the County’s Winery Working Group, prior to hearings before the Planning Commission, then the Board of Supervisors. .  The members of that Group have been working for the last six months to provide direction to the County about new winery applications.  Each of the previous meetings had been held before an audience that was required to stay silent at all times.  Monday night was the time for the County to hear from all of the interested stakeholders, large and small.

Until Monday night, the wineries and growers appeared to be in two camps:  those who were following every breath and sigh of the Winery Working Group and those who didn’t even know that the Group had been formed, or that a new County ordinance was working its way down to them.  Although the discussion of the new ordinance is cast as applying only to new wineries, there is the distinct possibility that the County would apply any new ordinance to existing wineries (whether through applications for increased production or changes to use permits).  As such, whether they knew it or not, every winery and grower will likely be affected by the new ordinance. 

From the more than 500 people who met in Santa Rosa Monday night, the news had finally been disseminated.  More than half of the audience members were there to support the wine business.  It was a refreshing sight to see growers, winery owners, winemakers, and tasting room staff energized, motivated, and wearing brilliant green t-shirts or stickers (brilliant in both their color and their use as a statement).  The anti-winery contingent was there with their plain white nametags and a few placards but Monday night’s energy belonged to the wineries and growers. 

Three central themes came from this energized group.  First, agriculture does not mean grapes growing peacefully by themselves, beyond the touch of human hands.  Instead, agriculture means feeding your family and making the mortgage.  That requires one to sell the grapes/wine, and selling necessarily requires marketing efforts.  Speakers from small wineries presented a compelling case of why they needed what the County calls “events” and what theycall distributor meetings or wine club dinners.  Without direct-to-consumer sales, only “the big guys” with their existing distributor outlets would be able to own wineries in Sonoma County.  The “big guys” had their say as well – without being able to hold distributor lunches or dinners, their business model fails as well. 

Another common theme was that the County should not regulate the type of activity going on at the winery.  Instead, the County should be regulating impacts – it shouldn’t matter whether there is a tasting menu, whether a customer sits or stands, or whether there is a fee for a wine club party.  No other business is in danger of having the County decide when, or whether, it can have business or staff meetings.  How can the County do that to wineries?

Finally, the wineries and growers challenged the opposition’s continued mantra of “rural character”.   Without high-end agriculture, the land would be sold for housing.  Housing would not recharge the aquifer, would not maintain the job base, and would be anything but “rural”.  The wineries and growers stepped up to the microphones Monday night by the dozens noting, among other things, that the first word on the Sonoma County seal is “Agriculture” and that pioneers like Sara Lee Kunde had worked tirelessly in the past to make agriculture economically viable.  Making a good living from agriculture is what allows for rural character in the first place. 

This is not isolated to Sonoma County.  Napa is dealing with their own ordinance battles, as is Santa Barbara, Paso Robles and the other wine-growing areas of the state.  Indeed, this “not in my backyard” approach to land use is also reflected in municipal ordinances restricting restaurants, nightclubs and wine stores in major cities throughout the state.

As the meeting approached 8:30 and then 9:00, many of the opposition group trickled out.  The winery and grower contingent just filled-in their seats behind them (about 100 people had not been allowed into the meeting room due to occupancy requirements and had been relegated to the lobby to watch the proceedings on a screen.)  When the meeting finally ended shortly after 9:00, the room was abuzz with energy from the green-clad growers and winery representatives finally being able to say their piece.  Indeed, one of the anti-winery speakers said to another as he was walking out of the meeting early, “The wineries – they’re organized.”  Ah – the power of working together toward a common goal.  

By Kimberley Corcoran, Carle, Mackie, Power & Ross LLP

The California Competes Tax Credit is a business income tax credit intended to incentivize economic development in the State of California.  If your business (whether organized as a corporation, limited liability company or partnership) is planning to hire and/or expand in California, please consider applying for the California Competes Tax Credit. 

The credit is awarded through a competitive application process and is individually negotiated with the Governor’s Office of Business and Economic Development (“GO-Biz”) for approval by a statutorily created California Competes Tax Credit Committee.  The credit is taken against income tax due to the California Franchise Tax Board.   

Although not yet officially announced, we anticipate that GO-Biz will open the next application period in late September (prior application periods have typically lasted around one month).  GO-Biz previously indicated that approximately $200 Million is available to be awarded in fiscal year 2015-16. 

The evaluation process consists of two phases (though it is possible to bypass Phase 1 under certain circumstances).  Phase 1 is an automated process in which the requested tax credit, aggregate employee compensation and aggregate investment are evaluated to arrive at a cost-benefit ratio.  Those applications with the “most advantageous” cost-benefit ratio proceed to Phase II. 

Phase II of the evaluation process focuses on several factors, including the number of jobs created, compensation paid to employees, amount of investment, geography and overall impact to the State of California.  
Successful applicants enter into a tax credit agreement to provide for allocations of the credit to be made upon the successful completion of established milestones (e.g., hiring, investment targets).  Awardees who fail to achieve the established milestones are at risk of having the credit recaptured.  

Online applications will likely be submitted athttps://www.calcompetes.ca.gov.  If unsuccessful, applicants may reapply in subsequent application periods. 

If you have questions about the California Competes Tax Credit or for help applying, please contact Daren Shaver at Carle, Mackie, Power & Ross LLP. (tel: 707-526-4200; e-mail: dshaver@cmprlaw.com.) 

- Daren Shaver, Associate    

Save the Date!

CMPR’s Annual California Employment Law Update 2024

Thursday, January 18, 2024 at 8:30 am

Oxford Suites, Rohnert Park

Find more resources at CMPRLAW.COM 

By Dawn Ross, Partner

As Shelter in Place restrictions continue to ease throughout California and employees return to the office, it is important for employers to be aware of the ever changing requirements and expectations to keep your staff and the public safe.

Below is a checklist for employers about how to safely reopen, while accommodating employees who need to continue to work at home under the Families First Coronavirus Response Act (“FFCRA”) and/or the Family and Medical Leave Act (“FMLA”).  Employers should also be aware of several other considerations that apply, including reasonable accommodation and leave obligations under the Fair Employment and Housing Act (“FEHA”), the Americans with Disabilities Act (“ADA”), and the California Family Rights Act (“CFRA”).

A. Create a Written Return to Work Plan

Most employers will return to the office in stages, with some employees continuing to work at home for an extended period of time.  This new hybrid workplace is likely to become the norm over the next several years.  Instead of allowing this to happen in a haphazard way, create a written return to work plan detailing who will be returning to the office, when they will be returning, and outlining what precautions have been put into place to keep employees and the general public safe.  Many of these steps will take a month or more, so start planning early.

1. Survey Your Employees.  In deciding who will be returning to the office, consider surveying your employees to find out who wants to return, who does not want to return, and who has medical or childcare issues that prevent their return.
2. Evaluate Your Workspaces.  Until a large portion of the population has been successfully vaccinated, employers will continue to need to implement social distancing guidelines.  This will mean moving employees into empty spaces, repurposing meeting rooms, installing plexiglass or other barriers, implementing different work shifts; installing workflow arrows, and installing air purifiers and/or HEPA filters.
3. Order PPE.  Order masks, gloves, hand sanitizer stations, cleaning supplies, and any other PPE needed for your workplace.
4. Daily Health Checks.  The Centers for Disease Control and Prevention (“CDC”) and the Occupational Safety and Health Administration (“OSHA”) recommend that all employers consider some kind of health check for employees coming into the workplace (other than home).  In addition, several counties have issued Health Orders instructing all employers to create policies that require employees to complete a health check before coming into the office. A number of counties have created a daily health check app for this purpose.
5. Temperature Checks & COVID-19 Tests.  Employers are also allowed to conduct temperature checks and to require employees to take COVID-19 tests (at the employer’s expense).
6. Plan for a Positive COVID-19 Test.  Employers should prepare a written plan for what steps will be taken if and when an employee tests positive for COVID-19.  This plan should address contact tracing, notifying local health officials, and cleaning the affected area, and must include a written notification to employees working in proximity to the positive employee without disclosing the employee’s identity.  AB685, codified at Labor Code section 6409.6, sets forth the details of what must be included in the employee notification effective January 1, 2021.  This notification is required to be sent within one business day of an employee testing positive or receiving an isolation order from a public health official.
7. Update IIPP Plan.  Cal/OSHA has now issued guidance requiring employers to include COVID-19 prevention measures in their Injury and Illness Prevention Programs (“IIPPs”).
8. Workers’ Compensation.  In California, there is now a rebuttable presumption that an employee testing positive for COVID-19 was “injured” at work if confirmed with a positive test within fourteen (14) days of performing labor at a place of work.  Employers should be prepared to initiate the claims process if an employee tests positive.

B. Employees Who Continue to Work From Home

1. Work from Home Expectations.  The CDC and local guidance indicate that employers should continue to have employees work from home as much as possible, especially those over 65 or in medical high-risk groups.  We expect these directives to work from home will continue for months into the future.  We recommend creating a written work from home policy that clearly states your expectations and requires your employees to commit to those expectations.
2. Paying Expenses.  Labor Code section 2802 requires employers to reimburse workers for “all necessary expenditures or losses incurred by the employee” in the course of the job.  This only applies if the employee is  obligated to work from home (not if it is optional).  The obligation to reimburse includes things like ink, paper, internet, and cell phone, and applies even if the employee does not incur any additional costs.
3. Cal/OSHA Workplace Safety.  Workplace safety rules apply to home offices.  Employees should be provided with adequate equipment such as ergonomically correct desks, chairs, and keyboards.
4. Changing Employees from Salaried Exempt to Non-Exempt.  Many employers have had to re-structure which may have left managers not managing anyone or, at least, not working full-time any longer.  If you have an employee who is not performing sufficient exempt work, you must reclassify them to non-exempt/hourly status to avoid potential legal exposure for wage claims.  The best way to reclassify an employee is to explain the reasoning, and then make sure they are fully prepared to track their hours and take their legally mandated meal and rest periods.
5. Make Employment Decisions in a Methodical and Documented Manner.  When you are downsizing and making other decisions that affect your workforce (e.g., deciding who is permitted to work from home and who is required to come to work, or whether tasks and opportunities are being spread evenly) be careful that your decisions are not discriminatory or appear to be discriminatory.  One way to ensure your decisions do not have an adverse impact and to create a record of your non-discriminatory process is to document the process by:
   • First, evaluate the needs of the office and the available budget;
   • Second, review the collective bargaining agreements and design a fair, consistent, and nondiscriminatory selection process based on both the process set forth in the bargaining agreement and as many objective criteria as possible; and
   • Third, document conversations with employees to track who is willing to make changes and who is not, so that it is clear what decisions were made by the employee and which were made by the employer.
6. Handling Employees Who Do Not Want to Return to Work.  When you contact employees to return to work, it is possible they will not want to return for various reasons.  Being told “no” is always an uncomfortable position to be in, but employers must take a measured approach to make sure the employee does not have a legally protected reason to say “no.”  For example, employees who band together to refuse to work because they feel the employer has not taken sufficient steps to minimize COVID-19 exposure may be protected under the NLRA for union concerted activity.

Employers should be reasonable when discussing concerns held by employees to come back to work and approach it in the same manner as the “good faith interactive process.”  This is not legally required but is a good way to ensure that you have done enough to feel confident that the employee does not have reasonable grounds to refuse to return to work.  Also, the conversation may unearth other rights the employee may have such as the right to take FFCRA-protected leave (see below) or FMLA leave.

If employees do not want to return because they are making more with unemployment benefits, you can advise them that they will not qualify for unemployment if they refuse to return to work.  You can then decide whether to put them on an unpaid leave of absence or consider them to have voluntarily resigned.

C. Families First Coronavirus Response Act (“FFCRA”)

The FFCRA provides paid time off for employees who cannot work due to COVID-19-related illness, a lack of childcare, or because they need to help their children with remote school.  The Department of Labor has issued an extensive Questions and Answers elaborating on the application of the FFCRA.  Currently, the FFCRA is scheduled to expire on December 31, 2020, but will likely be extended.

The FFCRA provides paid leave (that involves a tax credit for the employer) for the following reasons:

• (i) The employee is subject to a federal, state, or local quarantine or isolation order related to COVID-19;
• (ii) The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19;
• (iii) The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
• (iv) The employee is caring for an individual who is subject to either (i) or (ii) above;
• (v) The employee is caring for his or her child if the school or place of care of the child has been closed, or the childcare provider of such child is unavailable, due to COVID-19 precautions; or
• (vi) The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.

Amount of Paid Sick Leave.  All eligible full-time employees will have up to 80 hours of paid sick leave available to use for the qualifying reasons above.  Eligible part-time employees are entitled to the number of hours worked, on average, over a two-week period.

For employees with varying hours, one of the following two methods for computing the number of hours paid will be used:

• The average number of hours that the employee was scheduled to work per day over the six-month period ending on the date on which the employee takes leave, including hours for which the employee took leave of any type; or
• If the employee has worked fewer than six (6) months, the expected number of hours to be scheduled per day at the time of hire.

Rate of Pay.  Paid emergency sick leave will be paid at the employee’s regular rate of pay or minimum wage, whichever is greater, for leave taken for reasons (i) – (iii) above.  Employees taking leave for reasons (iv) – (vi) above will be compensated at two-thirds their regular rate of pay or minimum wage, whichever is greater.  Pay is capped at:

• $511 per day and $5,110 in total for leave taken for reasons (i) – (iii) above;
• $200 per day and $2,000 in total for leave taken for reasons (iv) – (vi) above.

Interaction with Other Paid Leave.  The employee may use emergency paid sick leave under this policy before using any other accrued paid time off for the qualifying reasons stated above.  Employees on expanded FMLA leave under this policy may use emergency paid sick leave during the first ten (10) days of normally unpaid FMLA leave.

Expanded FMLA.  In addition to the extra sick leave, expanded FMLA leave is available to eligible employees who are unable to work (or telework) due to a need to care for their child when their school or place of care has been closed, or the regular childcare provider is unavailable due to a public health emergency with respect to COVID-19.  The FMLA leave is twelve (12) weeks and provides pay at the same rate as described above for this type of leave.

D. Dealing With the General Public

1. Required Postings.  Most cities and counties have issued a list of required public postings.  Make arrangements for putting these in all areas open to the general public.
2. Refusing to Serve Customers Who Will Not Comply with Safe Practices.  There will always be some people who refuse to wear a mask or otherwise comply with safe practices.  In your Return to Work Plan, include a section advising employees how to deal with these situations.  For example, give them a card to hand to the person, indicating that they will not be served and must leave the building.  Include a number they can call to complain.  Tell the employee whom they should call if the situation escalates and/or the customer refuses to leave.
3. Consider an Assumption of the Risk Notice for Customers.  Many private companies are adopting an Assumption of the Risk policy for customers who visit their property.  The state has not weighed in on whether such an agreement would be enforceable.  It is possible that the state could declare such agreements entirely unenforceable or partially unenforceable depending on the circumstances.  Public employers could similarly consider posting an Assumption of Risk policy for those using their facilities

The new “normal” has an enormous number of moving parts for employers, but with early preparation and continual monitoring, employers and employees can achieve a safe and productive workplace.

Dawn Ross is the managing partner of Carle, Mackie, Power & Ross LLP, and leads its Labor & Employment Group.  Ms. Ross provides counsel and litigation support to both public and private employers.  Ms. Ross can be reached at dross@cmprlaw.com.

https://www.cmprlaw.com/the-new-hybrid-workplace-how-to-reopen-your-office/

Major changes in 2025 include:

• Increasing minimum wages and exempt salaries. 
• Wage and hour (PAGA) reform.
• Crime victims leave expansions.
• Indoor and outdoor heat illness standards.
• And many more!

Speakers

• Arif Virji, Esq.
• Samantha Pungprakearti, Esq.
• Justin Hein, Esq.
• Sarah Hirschfeld-Sussman, Esq.
• Kristin Mattiske-Nicholles, Esq.

CONFERENCE DETAILS

Join us In-Person or Remotely by Zoom

Date/Time:
January 14, 2025
8:30 a.m. - Registration & Breakfast for In-Person Attendees
9:00 a.m. - Program

Location:
The Oxford Suites - Sonoma County
67 Golf Course Drive West
Rohnert Park, CA 94928

In-Person attendees will be eligible to win a $400 gift card for dining at "the girl & the fig" restaurant in our Raffle Prize Drawing.

Register Here

www.comprlaw.com / Phone: 707-526-4200