Question:  I run a relatively large business in California, and I do my best to keep up on California’s ever-changing legal landscape (I read all of your articles).  Are there any other new compliance obligations that I should be aware of going into 2021?

Answer:  The California Legislature once again passed an extensive list of new employment laws.  We have covered a number of the major laws in prior articles; however, there are a few other new laws that have received less attention but still require action by California employers for the upcoming year, including the two listed below.

Assembly Bill 979

In 2018, California enacted Senate Bill (“SB”) 826, which required publicly held domestic or foreign corporations with their principal executive offices in California to have at least one female on their board of directors by the end of 2019, with that number potentially increasing by the end of 2021 depending on the size of the board of directors. Assembly Bill (“AB”) 979 enacts very similar provisions requiring these corporations to have directors from “underrepresented communities.”  A “director from an underrepresented community” is defined as an individual who is “Black, African-American, Hispanic, Latino, Asian, Pacific Islander, Native American, Native Hawaiian or Alaska Native or who self-identifies as gay, lesbian, bisexual, or transgender.”

Pursuant to AB 979, by no later than the close of the 2021 calendar year, these corporations must have at least one director from an underrepresented community on their board of directors. AB 979 sets additional targets for such board membership by the close of the 2022 calendar year, depending on total board size.  Notably, AB 979 imposes significant fines for non-compliance ranging from $100,000 to $300,000.  AB 979 also requires that the Secretary of State post annual reports on its website listing, among other information, the number of corporations that are in compliance with the new requirements, as well as information regarding those corporations that either moved their headquarters into or out of California.

Assembly Bill 1963

California’s Child Abuse and Neglect Reporting Act requires “mandated reporters” to report to specified agencies (e.g., police or county welfare) whenever they, in their professional capacity or within the scope of their employment, observe a child they know or reasonably suspect has been the victim of child abuse or neglect. If a mandated reporter fails to report a known or reasonably suspected case of child abuse or neglect, he or she faces misdemeanor liability, including statutory penalties and potential jail time.

AB 1963 adds to a lengthy list of mandated reporters “human resource employees of a business with 5 or more employees that employs minors.” AB 1963 defines a “human resource employee” as the employee or employees designated by the employer to accept any complaints of misconduct as required by the California Fair Employment and Housing Act.  AB 1963 also adds to the list of mandated reporters, for purposes of reporting sexual abuse, “an adult whose duties require direct contact with and supervision of minors in the performance of the minors’ duties in the workplace of a business with 5 or more employees.”  AB 1963 further requires businesses to provide their employees who are mandated reporters with training. This training must address child abuse and neglect identification and child abuse and neglect reporting.

Businesses should start planning ahead for these requirements to ensure that they are not subject to penalties or liability.