By CalChamber –
Some of the bills signed into law this year made significant changes to California employment law, while others made small, but important changes of which employers must be aware.
New laws were passed in the areas of recruiting and hiring; discrimination, harassment and retaliation protections; leaves of absence and benefits; workplace safety; arbitration; privacy; and wage and hour.
Below is a sampling of important employment laws employers should know, taken from the California Chamber of Commerce free white paper New 2020 Labor Laws Affecting California Employers.
Unless otherwise noted, the new laws take effect on January 1, 2020.
Recruiting and Hiring
•AB 5 codifies and expands the “ABC test” that’s used to distinguish employees from independent contractors under the Industrial Welfare Commission (IWC) Wage Orders.
Under the ABC test, a worker is classified as an employee unless the employer can establish all three of the following:
1.The worker is free from the hiring entity’s control and direction in connection with the performance of the work, both under the contract for the performance of the work and in actually performing the work;
2.The worker performs work that’s outside the usual course of the hiring entity’s business; and
3.The worker is customarily engaged in an independently established trade, occupation or business of the same nature as the work performed.
AB 5 carves out numerous exceptions from the ABC test for various industries. If an exception is applicable, the more flexible common law multi-factor “Borello test” typically applies, focusing on the entity’s control over the worker. While some of the exceptions detailed in the bill provide clarity for certain professions/ industries, several are complex and subject to numerous criteria. Employers should consult with legal counsel on the potential application of exceptions under AB 5 and the different classification standards.
