CALSAVERS: RETIREMENT PLANNING MADE EASY

Question: Is it mandatory to provide a retirement plan for all of my employees?

 

Answer: Not exactly.  California established the CalSavers Retirement Savings Program (“CalSavers”), an IRA designed to benefit employees whose employers do not offer traditional retirement plan programs.  With minimal action required and no fees or liability for employers, CalSavers is a simple and effective way for employees to save money and plan for retirement.

 

With automatic enrollment and contributions made through payroll deductions, CalSavers makes it easier for employees to save for retirement. Once an employee is enrolled, the money saved belongs solely to the employee and the account can move freely with the employee from one job to the next.  CalSavers is not sponsored by the employer, meaning the employer is neither responsible nor liable for an employee’s decision to participate in the program or the performance of investments.  An employer’s responsibilities under CalSavers are limited to registering for CalSavers, providing employee information to the CalSavers administrator, and remitting employee contributions through payroll deductions.

 

CalSavers is mandated for all California private for-profit and non-profit employers that do not already sponsor a retirement plan for their business and that have more than five full- or part-time employees over the age of 18 with at least one employee working in California.  Eligible employers that fail to enroll are subject to a penalty per eligible employee.  Employers that maintain or contribute to a Tax-Qualified Retirement Plan which qualifies for favorable federal income tax treatment, regardless of whether all employees are eligible for the Plan, as well as employers with fewer than five employees, are prohibited from participating in the CalSavers program.

 

Prior to the effective dates listed below, employers must log on to the CalSavers site to either register online or certify their exemption from CalSavers by stating that their business already maintains a retirement plan:

 

 

Effective Date Number of Employees
June 30, 2020 More than 100
June 30, 2021 More than 50
June 30, 2022 More than 5

 

Existing employees of employers that participate in CalSavers must be enrolled within 30 days after the employer registers with CalSavers. Employees hired after the employer registers will be automatically enrolled within 30 days of their date of hire or date of eligibility.  Despite this automatic enrollment, participation in CalSavers is voluntary, and employees may choose to opt out at any time.

 

Once the employer is enrolled, on each payroll date, it must deduct and transfer each participating employee’s contribution to the CalSavers administrator. All employee contributions must be remitted as soon as administratively possible, not to exceed seven business days from the date of deduction.

 

When providing information about CalSavers to employees, employers are required to remain neutral about their employees’ participation in the program. The CalSavers regulations expressly preclude employers from requiring, endorsing, encouraging, prohibiting, restricting, or discouraging employee participation in CalSavers, or from providing any advice or direction regarding any employee decision about CalSavers (e.g., investment choices, contribution rate, etc.).  To maintain neutrality, CalSavers will provide an email template at the time of registration that employers may share with employees to inform them that CalSavers will reach out to them.  The employees can then communicate with CalSavers directly to get further information and to ask any questions they may have.

 

Although CalSavers becomes effective next year, employers may begin registering now at the following link: https://employer.calsavers.com/californiaertpl/enroll/createEmp/viewCollectEmpPreRegDetails.cs.


Background Check Requirements

Question: I own a company where my employees have to enter the homes of my clients. Can I have criminal background checks done on my current employees?

Answer: Yes, the law allows consumer reports and investigative consumer reports (commonly referred to as background checks) on existing employees for the purpose of evaluating the employee for promotion, reassignment or retention as an employee. Specific disclosures must be provided to your employees, along with written authorization as required by the federal Fair Credit Reporting Act (FCRA), the California Investigative Consumer Reporting Agencies Act (ICRAA), and the California Consumer Credit Reporting Agencies Act.

Consumer reports and/or investigative consumer reports contain information such as criminal histories, DMV reports, verification of education, license, and past employment history. By contrast, a consumer credit report contains information about an individual’s creditworthiness, credit standing, and credit capacity, which is used in determining the individual’s eligibility for employment. An employer is not required to comply with the California Consumer Credit Reporting Agencies Act requirements unless the employer seeks to obtain a consumer credit report.  A consumer credit report can only be obtained by employers in certain circumstances; so contact legal counsel if you wish to obtain an employee’s consumer credit report.

Both the FCRA and the ICRAA require employers to do the following before obtaining a consumer report and an investigative consumer report:

  • Provide separate FCRA and ICRAA written notices to the employee of the intent to obtain a background check report.
  • The FCRA notice must: (1) State that the report may be obtained for employment purposes; (2) Be clear, conspicuous, and in writing; and (3) Be in a document that consists solely of the disclosure.
  • The ICRAA notice must: (1) Be clear, conspicuous, and in writing; (2) Be in a document that consists solely of the disclosure; (3) State that an investigative consumer report may be obtained; (4) State the permissible purpose of the report; (5) State that the disclosure may include information about the employee’s character, general reputation, personal characteristics, and mode of living; (6) Identify the investigative consumer reporting agency that will conduct the investigation by name, address, and telephone number; (7) State the nature and scope of the information requested; (8) Provide a summary of the employee’s rights under the ICRAA; and (9) Contain a box that the employee may check to receive a copy of the credit report.
  • Obtain the employee’s written authorization before the background check is obtained;
  • The employer must certify to the reporting agency performing the background check that the employer has complied with the requirements of the FCRA and the ICRAA by making the applicable disclosures to the employee; and
  • The employer (or reporting agency) must provide a copy of the report to the employee if the employee requests it. Agencies who conduct background checks often provide the necessary notices for obtaining background checks, and may help you obtain employee authorizations. It is important to use an agency that follows the FCRA and ICRAA requirements. When you receive the background check reports, if you believe you will be discharging an employee based on the report’s findings, you should contact an attorney to discuss the report’s findings since the law restricts employment decisions based on an employee’s criminal history. There are also certain procedures that must be adhered to before discharging an employee based on criminal history.

Employers EEOC Pay Data Reporting Due September 1, 2019

Question: I run a business with over 100 employees and I am confused about the pay data I have to report to the EEOC.   I submitted the EEO-1 report by the May 31 deadline but now I am being told that I need to submit additional information.  What do I do?

Answer: Since 1966, as part of efforts to regulate compliance with federal equal employment opportunity laws, the Equal Employment Opportunity Commission (EEOC) has required private employers with 100 or more employees to submit EEO-1 reports on an annual basis. Federal government contractors and first-tier subcontractors with 50 or more employees and at least $50,000 in contracts must file as well. These annual reports are due May 31 of each year and historically contain information about the number of employees employed by job category, race, sex, and ethnicity.  The EEOC refers to this as Component 1 data.  While the EEOC uses these reports internally for compliance investigations, the reports are also used by agencies and private litigants in employment discrimination cases.

In 2016 the EEOC announced its intention to expand the EEO-1 reporting requirements to include reporting of employees’ W-2 earnings and hours worked in 12 pay categories (Component 2 data). The collection of Component 2 data was subject to approval of the Office of Management and Budget (“OMB”), which initially granted approval in September 2016.  The expanded collection of data on the EEO-1 was to be effective in late 2017.  However, in August 2017, the OMB issued a stay, ordering the EEOC not to collect Component 2 data.

Thereafter, employee advocate groups, including the National Women’s Law Center, filed actions against the OMB and EEOC seeking to require the EEOC to collect the Component 2 data.  In March 2019, a federal judge in Washington D.C. agreed with the plaintiffs, finding that the OMB’s stay of the collection of W-2 and pay data was not justified.   On April 25, 2019 the Court issued a second order, directing the EEOC to collect 2018 hours worked and pay data by September 30, 2019.  The Court also directed the EEOC to collect an additional year of W-2 and hours worked pay data from covered employers, but gave the EEOC the option of collecting the data for either calendar year 2017 or 2019.  The EEOC has announced that it will collect Component 2 data for 2017.

On May 3, 2019, the Department of Justice filed a notice of appeal in the National Women's Law Center case.  While the decision on appeal may change the required EEO-1 reporting requirements again, for now employers with 100 or more employees are required to submit Component 2 data to the EEOC on the EEO-1 form for both 2017 and 2018 by September 30, 2019.  The Component 2 data includes wage information from Box 1 of employees’ W‑2 forms and total hours worked for all employees, categorized by race, ethnicity and sex, within the 12 pay categories.  The EEO-1 report should show actual hours worked by nonexempt employees, an estimated 20 hours worked per week for part-time exempt employees, and 40 hours worked per week for full-time exempt employees.

The EEOC created a web-based portal for employers to submit Component 2 data, and that portal is currently open. The URL for the portal is https://eeoccomp2.norc.org.  The EEOC also released a sample form, instructions and FAQs to help employers submit the Component 2 data, accessible at https://eeoccomp2.norc.org/Faq


New Law Banning Discrimination Based on Natural Hairstyles

Question: My business has a grooming policy that requires our employees to maintain a professional appearance, including employees’ hairstyles. I heard California just passed a new law protecting employees with “natural” hairstyles. What exactly does that mean?

 

Answer: On July 3, 2019, Governor Gavin Newsom signed a new bill that bans employers and school officials from discriminating against individuals based on natural hair and hairstyles associated with race. Senate Bill 188, referred to as the CROWN Act (Create a Respectful and Open Workplace for Natural Hair) protects the right of individuals to wear their hair in its natural form in the workplace or school.  This bill is specifically drafted to address, “purportedly race-neutral grooming policies that disparately impact Black individuals and exclude them from some workplaces.”

 

Currently, the Fair Employment and Housing Act (FEHA) makes it unlawful for California employers to engage in discriminatory practices based on certain protected characteristics, including race. The CROWN Act provides that the definition of "race" under FEHA includes "traits historically associated with race, including but not limited to, hair texture and protective hairstyles.”  The term “protective hairstyles” includes, but is not limited to, such hairstyles as braids, locks, and twists.

 

This new law does not prevent employers from making and enforcing grooming policies that require employees to maintain a “professional” appearance, but it does prohibit employers from considering natural hairstyles historically associated with race, such as braids, locks, and twists, to be “unprofessional.” The bill’s preamble speaks to societal norms in the United States that have historically equated “blackness” and the associated physical traits “to a badge of inferiority, sometimes subject to separate and unequal treatment.”  This idea, the bill explains, has also permeated societal understanding of professionalism. “Professionalism was, and still is, closely linked to European features and mannerisms, which entails that those who do not naturally fall into Eurocentric norms must alter their appearances, sometimes drastically and permanently, in order to be deemed professional.”

 

Employers may continue to implement grooming and appearance policies that include employee hairstyles, so long as they are non-discriminatory and have no disparate impact on any protected class. The policy should not explicitly prohibit hairstyles that are historically associated with race, such as Afros, braids, locks, twists, and cornrows.  Any restrictions on hairstyle should be driven by legitimate and objective business needs that are stated in the policy.  If hairstyles have previously been restricted at the workplace due to health and safety concerns, employers should consider alternatives, such as hairnets, hair ties, and safety equipment.  Employers should keep in mind that they may also be required to accommodate employees' religious beliefs by allowing them to wear head coverings and other items if the accommodation does not place an undue burden on the employer.  As with any policy, employers should take care to implement grooming and appearance policies in a fair and consistent manner with all employees.

 

California’s new law will take effect on January 1, 2020 and it applies to public schools, private employers with five or more employees, and public employers. It does not apply to religious associations or nonprofit organizations. Since Senate Bill 188 was signed into law on July 3, the state of New York has also followed suit, becoming the second state in the United States to ban discrimination based on natural hair or hairstyles.


Summertime and the Living is Easy

Question: Each summer my employees’ clothing becomes more casual.  How can I ensure my employees come to work dressed in professional clothing?

 

Answer: Business dress codes are important not just for how employees present themselves to customers and the public, but they address important safety concerns as well.  For instance, flip-flops, and other open-toe sandals, are generally not appropriate to wear to work due to their casual appearance.  In addition, their tendency to cause trips and falls make them a workplace safety hazard.

 

California law allows employers to establish reasonable dress and grooming standards based on legitimate business concerns, which can include workplace safety and professionalism. If your employees’ workplace summer clothing does not meet these standards, it may be time to reinforce your business’s dress code policy, or create a written policy governing employee dress if one is not already in place.

 

If an employee’s clothing does not conform to your business’s dress code, you should request that the employee return home and change. Alternatively, you may speak privately with the employee, explain why the particular article of clothing is not appropriate, and request that the employee not wear that type of clothing in the future.  Whichever method you choose, remember to be consistent and apply the same standards to all employees.  Also, it is important to remember that both California and federal laws require employers to make reasonable accommodations for employees’ religious dress or grooming practices, as well as an employee’s gender expression and gender identity, unless such accommodation is precluded by business necessity.

 

It is important to enforce the business dress code even outside the office during employer-sponsored picnics or other team building activities. While you may relax the standards (employees should be permitted to wear open toe sandals, shorts, etc. outside at a picnic), it is important to remember that excessively revealing clothing worn at employer-sponsored events may lead to claims of sexual harassment, which is prohibited by the California Fair Employment and Housing Act (“FEHA”) and Title VII of the Civil Rights Act of 1964.  Accordingly, in addition to a dress code policy, it is important to have, and enforce, a policy prohibiting harassment and discrimination, and you should remind employees that those policies apply every day, even during office celebrations.

 

Beyond dress code concerns, employer-sponsored summertime activities may give rise to liability for workers’ compensation claims. Workers’ compensation claims may arise from injuries sustained at a picnic or other event if the injuries are work-related.  In order to minimize the risk of a claim, you should make it clear that attendance at the event is completely voluntary, hold the event during off-duty hours, and refrain from engaging in any business during the event.  Holding the event at a location other than company premises may also lessen the risk of a claim.  If the event includes sports, such as baseball, boating, or rock climbing, you should consider having employees sign waivers releasing the company of liability for injuries sustained during participation.

 

Having written dress code and harassment prevention rules and guidelines in place, and applying them consistently year-round, will ensure that employees know what clothing and conduct is acceptable. Additionally, awareness of potential issues with employer-sponsored events can help employers avoid liability for workers’ compensation and harassment claims.


Student Loan Assistance

Question:  I am considering unique ways to attract qualified employees to my company.  Can I offer to help employees pay down their student loan debt?

Answer: Yes, but both you and the employees who benefit from a loan repayment program should understand the potential issues and risks of these benefits.

With the national unemployment rate at 3.6 percent as of May 2019, some businesses are boosting their appeal by offering to help employees pay down their student loans. These benefit programs help attract workers in a competitive labor market and increase employee retention as individuals with student loans may stay with a company longer to reap the full benefits of these plans.

Companies are not limited to a single approach when it comes to offering a student loan repayment benefit. For example, the online learning company Chegg recently made headlines by offering entry-level and manager-level employees up to $5,000 per year toward their student debt.  Chegg sets aside a pool of its shares, from which it gives an employee a stock grant with taxes withheld as income.  Chegg sells the stock for the employee and the after-tax cash goes to a third-party company that works with employers to manage debt payments to the schools employees attended.   Similarly, Fidelity Investments has an employee debt forgiveness plan that offers up to $10,000 over five years to pay off school loans.  Fidelity’s plan also provides employees with online tools to help them better manage their student loan debt.  While these programs may help attract new talent, employers and employees alike should understand the financial implications of such programs.

Unlike employer-sponsored retirement plans and health insurance, there is currently no tax benefit for employers that provide money directly to employees or pay down employees’ student loans. Such payments are considered regular wages so both employers and employees pay taxes on the loan payments. There are ongoing efforts at both the federal and state level to provide tax incentives to promote these increasingly-popular employer-sponsored debt repayment programs.

In February 2019, federal lawmakers introduced the Employer Participation Repayment Act, which would permit employers to contribute up to $5,250 tax-free annually to their employees’ student loan debt repayment. The bill seeks to expand the current Employer Education Assistance Program, which only provides assistance for workers who are seeking additional education, but does not benefit individuals who already have incurred student loan debt.

California lawmakers introduced similar legislation earlier this year. Assembly Bill (AB) 152 seeks to encourage the use of employer-sponsored student loan debt programs in California by amending California’s Revenue and Taxation Code to allow employees to deduct employer contributions toward student loans from their taxable income.  If passed, AB 152 would allow an employee to exclude from gross income amounts paid by an employer on the employee's behalf, not to exceed $5,250 per calendar year, toward the principal or interest on a qualified education loan.

While these recent legislative developments are encouraging, the California legislation has failed to gain traction thus far, and, given the current atmosphere in Washington, it is hard to predict if or when any particular legislation will be passed. For now, employers should be aware of the financial implications of this benefit, and work closely with employees to make sure that employees also understand their financial responsibilities.


Travel Time Pay

 

Question: Due to the U.S. Open traffic this weekend I expect it will take my employees longer to make deliveries and perform other tasks outside the office during the work day.  Do I have to pay them for sitting in traffic?

 

Answer: Yes, time spent by your non-exempt employees performing work tasks that require travel is compensable, even when it takes your non-exempt employees longer to perform their tasks because of traffic.  Additionally, if they end up working more than 8 hours in a day because of that travel time, they will be entitled to overtime pay.

 

The Industrial Welfare Commission Orders define “hours worked” as the “time during which the employee is subject to the control of an employer.” For example, time spent commuting to and from work is not considered “hours worked,” and a commute made longer due to traffic is not compensable.  However, when employees are on the road making deliveries and performing other employer directed tasks, they are under the employer’s control, and if traffic causes these employees to take longer to perform these tasks, all of that time is compensable.  California law does not distinguish between hours worked during and outside the employer’s "normal" business hours.

 

It should also be noted that under state law, if an employer requires an employee to attend an out-of-town business meeting, training session, or any other event, whether the outing involves same day or overnight travel, the employer is obligated to pay for the employee's time in getting to and from the location of that event. Time spent driving, or as a passenger on an airplane, train, bus, taxi cab or car, or other mode of transportation, in traveling to and from this out-of-town event, and time spent waiting to purchase a ticket, check baggage, or get on board, is time spent carrying out the employer's directives and is compensable.  However, time spent taking a break from travel in order to eat a meal, sleep or engage in purely personal pursuits not connected with traveling or making necessary travel connections (such as, for example, spending an extra day in a city before the start or following the conclusion of a conference to sightsee), is not compensable.

 

The rate at which the travel must be paid depends upon the nature of the compensation agreement. If the employer has agreed to pay a fixed hourly rate of pay for any work performed, then travel time must be paid at that regular hourly rate, and if overtime is incurred, the required overtime rate based on the regular hourly rate must be paid.  However, an employer may establish a separate rate of pay for hourly employees for travel time as long as advance notification has been provided to the employees, and provided the rate does not fall below the statutory minimum wage.

 

In addition to travel time, employers are required to reimburse employees for necessary expenses incurred in connection with employer-required travel. The most common form of employee expense reimbursement related to travel is mileage reimbursement when the employee uses the employee’s own vehicle for work related travel. The safest approach is to use the IRS mileage reimbursement rate.  The 2019 rates can be found at https://www.irs.gov/newsroom/irs-issues-standard-mileage-rates-for-2019

 

As we welcome golf fans to the Peninsula employers need to be aware of potential employment related issues caused by the traffic and plan accordingly.


California Workplace Privacy Rights

Question: What privacy rights do my employees have and how can I comply with the laws protecting privacy rights?

Answer: In light of recent data breaches, people are increasingly concerned with protecting their privacy rights. California employees are no exception. The California Constitution identifies certain inalienable rights for citizens, including “pursuing and obtaining safety, happiness, and privacy.” Additionally, employees in the state are covered by statutes that protect their privacy inside and outside of the workplace. To comply with these laws, employers must be aware of the state’s stringent privacy rules and should establish policies designed to comply with the law.

Employers have a non-waivable duty to protect personal employee information. Businesses that maintain personal information about a California resident are required to protect that information from, among other things, unauthorized access, use, or disclosure. Personal information includes, but is not limited to, an individual’s name, social security number, driver’s license or identification card number, financial account number, medical information, health insurance information, and username or email address in combination with a password. Additionally, employers have a duty to disclose security breaches of computerized personal information. Employers who breach these duties may be liable for monetary damages.

California employers should exercise care in connection with workplace monitoring, such as video surveillance and listening to employee telephone conversations. Employers are prohibited from video monitoring work areas where employees reasonably expect privacy such as dressing rooms, locker rooms, showers, toilet facilities, and possibly even break or lunch rooms. Employers cannot monitor or record personal employee phone calls or calls made between parties in California without the parties’ consent, except in limited situations. When employers have a legitimate business purpose for video or telephonic monitoring, it is a best practice to disclose the monitoring to employees in a handbook, memo, sign, or by other means that will be understood by employees.

Additionally, California imposes limits on conducting background checks such as credit or criminal history reports. An employer may not ask an outside agency to perform a background or credit check on an applicant or employee in California without first giving proper notice to the individual, obtaining the individual's consent, and giving the individual an opportunity to request a copy of the report. The employer's notice must be clear and conspicuous on a form that contains only the disclosure. California law also requires new consent each time an investigative report is sought during employment if the report is for purposes other than suspicion of wrongdoing or misconduct. California recently enacted a “ban-the-box” law that prohibits employers from asking job applicants about their criminal history until after a conditional offer of employment is made. Before taking any adverse employment action based on a report, employers must follow very specific procedures in writing.

To ensure compliance with California’s employee privacy laws, employers should implement workplace policies that communicate the employer’s practices and business reasons for them, and obtain advance written employee consent when required by law. Employers should also implement appropriate safeguards for storing, using, and disposing of private employee information. Finally, employers should not infringe on employee privacy except where necessary to serve the employer’s legitimate business purposes, and should choose the least intrusive means available to accomplish that purpose.


Risks of Using Social Media to Screen Applicants

Question: As a small employer, I do not perform pre-hire background checks, but I have been google-searching candidates and looking at their Facebook profiles before making hiring decisions. I am shocked by the amount of information available on the internet. Are these types of screenings risky?

Answer: Yes. To illustrate why employers should be wary of performing these types of pre-employment searches, consider the appropriateness of asking the following questions during a job interview: “Are you pregnant?” “With what gender do you identify?” “Do you have a criminal record?” “Have you had any recent medical issues?” While most employers quickly recognize that asking an applicant such questions is unlawful, few recognize that performing a pre-employment social media search may elicit the same type of information.

According to a 2017 national survey conducted by the job search website CareerBuilder, approximately 70% of employers use social media to screen candidates before hiring, up from 60% in 2016. According to the survey, while 60% of employers who use social media screening are looking for information that supports the candidate’s qualifications for the job, 50% are looking to determine whether the candidate has a professional online persona, and 24% are looking for a reason not to hire a candidate. Although the statistics imply that a majority of employers are using pre-hire social media searches for reasons that appear to make sense, such searches can present significant risks from a legal standpoint.

A social media search often reveals information about the candidate’s protected characteristics that employers are not permitted to consider in making hiring decisions, and about which the employer would have no knowledge if the search had not been conducted. If the employer does not hire the candidate, the candidate can argue that it was because of the protected characteristics that the search revealed, and the employer is placed in the difficult position of proving that its decision was based on a legitimate, non-discriminatory reason.

To protect itself from a claim of discrimination, an employer should limit requests for information during the pre-employment process to details essential to determining a person’s qualifications to do the job, with or without reasonable accommodations. California law specifically prohibits employers from requesting or considering information about an applicant or employee that would disclose the individual’s membership in a protected classification (i.e. national origin, religion, age, sexual orientation), except in very limited circumstances where the characteristic is related to a bona fide occupational qualification. The Department of Fair Employment and Housing (DFEH) publishes guidance on what employers can and cannot ask applicants and employees, which is available at https://www.dfeh.ca.gov/wp-content/uploads/sites/32/2017/06/DFEH_PEI-Guidelines.pdf. In terms of a social media search, this means that employers should limit themselves to looking on professional networking websites like LinkedIn or BranchOut, and avoid sites like Facebook, as well as general Google searches.


Cell Phones at Work

QUESTION: My company restricts employee use of personal cell phones while on duty. This policy does not stop employees from using their phones to text, talk, take pictures, and post on social media while at work. What can I do to curb cell phone use during the work day?

ANSWER: It is important to implement and enforce common sense written policies for employees’ use of personal cell phones and social media while at work. The details of the policies will depend on the size of your business, your company culture, and your area of industry. For example, some employers allow employees limited use of cell phones while on duty to allow them to check on childcare or other urgent and time sensitive personal matters. For those employers, it is important to be vigilant in making sure employees are not abusing this privilege.

However, some employers impose more restrictive policies because cell phone use while on duty can detrimentally interfere with delivery of services. For example, in the healthcare field, it makes sense to prohibit personal cell phone use during working hours to protect patient privacy and ensure the safe and efficient delivery of health care. In the restaurant industry, employers often restrict employee cell phone use to ensure good customer service. In these instances, it is recommended that the employer require employees to leave their cell phones in a locker or other location, and not carry them on their person or have them at their workstation. However, employees must be permitted to use their cell phones while on rest breaks and meal periods. It is also important that these employers tell employees that in cases of emergency, their family members may call the business to reach them without delay.

Regardless of whether you decide to allow limited use of personal cell phones during the workday, or preclude such use altogether except during rest and meal periods, you should implement written policies that clearly set forth your expectations for both cell phone and social media use. Employees who violate the policies should be appropriately disciplined.

A cell phone use policy should include:
• Specifications on if and when personal cell phone use is permitted, and whether cell phones are allowed in work areas.
• Where limited cell phone use is permitted, requirements that all ringtones be set to silent and that all calls be taken away from work areas.
• Restrictions on use of the cell phone camera, video, and recording features when on duty and on work premises.
• Prohibition on use of personal cell phones when off duty for work-related purposes unless authorized by a manager. This is because time spent off-duty by a non-exempt employee using a personal cell phone for work is compensable if the employer knows or should know that the employee is using his or her personal cell phone for such purposes.
• Restrictions on social media posts that identify the employer or imply the views expressed are those of the employer.
• Prohibitions on checking personal Facebook or other social media sites, and posting on these sites when on duty.
Having written policies in place that clearly detail permissible use of employees’ personal cell phones while at work and use of social media, and enforcing the policies, will assist you in curbing misuse of personal cell phones and protecting your company in the event of a lawsuit.


Sexual Harassment and Defamation

Question: In my job as a supervisor, I received a complaint that one of the employees I supervise was sexually harassing a co-worker. The accusations were descriptive and lewd. I reported the complaint to the owner of the company. Now the accused employee is very angry with me and is threatening to sue me for defamation. I was just doing my job but now I am concerned. Does the law protect me?

Answer: Generally, in order to prove defamation, the accused employee must prove that you made a false and unprivileged statement of fact about him/her to a third party, and that the accused employee was damaged by your statement.

California law provides specific “privileges” that provide a defense to a defamation action. One new privilege addresses the situation you are facing.

On June 25, 2018 the California Legislature unanimously passed AB 2770, and Governor Brown signed the bill into law on July 9, 2018. In response to the #MeToo and #WeSaidEnough movements demanding action to address the ongoing prevalence of sexual harassment, the Senate Judiciary Committee, in conjunction with the Senate Select Committee on Women, Work and Families, held informational hearings in early 2018. These hearings sought to identify legal and policy reforms needed to transition California toward a culture free of harassment. The Legislature determined that the state’s defamation laws sometimes deter victims, witnesses, and former employers from making complaints or communicating information about harassers to others. As a result, AB 2770 was introduced and received widespread support from the business community.

AB 2770 makes three types of communications related to sexual harassment privileged, meaning they cannot form the basis for a defamation lawsuit, as long as the communications are made without malice. First, the bill protects a non-malicious complaint about sexual harassment communicated by an employee to an employer. Second, non-malicious communications by the employer to “interested persons,” such as an investigatory agency, witnesses, investigators, human resources professionals, co-workers, and other persons involved with resolving the sexual harassment complaint are protected. Finally, AB 2770 protects non-malicious communications, in response to an inquiry, in which a former employer tells a prospective employer that the former employer would not rehire the former employee based on the former employer’s determination that the employee engaged in sexual harassment. While many employers’ policies and human resources best practices prohibit providing this type of information to prospective employers, the Legislature specifically added this protection for employers who may choose to disclose such information, without malice, to a prospective employer.

So how does one know if a communication is made “without malice?” As interpreted by California courts, a malicious communication is one that is either motivated by hatred or ill will, or is made without reasonable grounds for believing that the matter asserted is true. AB 2770 protects only communications that are made “without malice.” This means that in the context of sexual harassment allegations and investigations, victims and witnesses may make complaints, but false accusations made out of spite or in complete disregard for the truth will not be protected.
One stated goal of this new law is to extend California’s public policy protecting employees from sexual harassment. The text of the bill is available on the California Legislature’s website:
https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180AB2770


Update to Employer Response to Immigration Audit

Question: I read in a recent Workplace Law article that I cannot voluntarily consent to an ICE agent accessing nonpublic areas of the worksite or employee records without a warrant. Is that still true?

Answer: Not entirely. Due to a July 2018 preliminary injunction issued by the U.S. District Court of the Eastern District of California, employers may allow ICE agents to access nonpublic areas of the workplace and access employee records without a warrant or subpoena.

As background, effective January 1, 2018, California’s Immigrant Worker Protection Act (AB 450) imposed new duties on employers facing worksite immigration inspections. AB 450 provides that an employer will be fined up to $10,000 per violation if it engages in the following:

• voluntarily consenting to ICE agents accessing any non-public areas of a worksite unless the agents present a judicial warrant;
• voluntarily allowing ICE agents to access, review, or obtain any employee records unless the agents present a Notice of Inspection of Forms I-9, and a subpoena, or a judicial warrant requiring compliance; and
• reverifying the employment eligibility of any current employee unless required by federal law.

In response to AB 450, the federal Department of Justice sued the State of California arguing that AB 450 forced California employers to choose between following federal law or state law at the risk of facing state penalties, and as such prevented federal law from being followed. On July 5, 2018, the U.S. District Court of the Eastern District of California granted a preliminary injunction prohibiting California from fining employers who voluntarily grant ICE access to their worksite or employee records, stating, “The Court finds that a law which imposes monetary penalties on an employer solely because the employer voluntarily consents to federal immigration enforcement's entry into nonpublic areas of their place of business or access to their employment records impermissibly discriminates against those who choose to deal with the federal government."

The Court did not block another provision of AB 450 that requires employers to notify employees concerning I-9 form inspections. Employers must still provide employees with notification of an inspection of I-9 forms or other employment records by federal immigration authorities, within 72 hours of receiving notice of the inspection. The notice must contain the following:

(1) name of the immigration agency conducting the inspection;
(2) date the employer received notice of the inspection;
(3) nature of the inspection; and
(4) a copy of the notice of inspection.

Within 72 hours of receipt of the inspection’s results, employers must provide each affected current employee with the inspection results, and give each affected employee a second written notice setting forth:

(1) all deficiencies identified in the inspection results;
(2) the time period for correcting any deficiencies;
(3) the time and date of any meeting with the employer to correct deficiencies; and
(4) notice that the employee has a right to representation during the meeting with the employer.

The Court’s ruling is a preliminary injunction and will likely be appealed. For now, employers will not be fined or be in violation of California law if they grant ICE agents access to nonpublic areas of the worksite without a warrant or subpoena, or allow them to access employee records. However, employers may still require a warrant before admitting ICE agents to nonpublic areas or before granting access to employee records.