2023 Employment Law Update

Our initial 2023 Employment Law Update is on January 10, 2023, in Napa, California. The presentation will cover new laws from the past year as well as recent court cases and administrative developments. Some topics include:

• Minimum wage and other wage-payment changes

• Pay data reporting and pay scale disclosure

• Leaves of absence and sick pay use

• Reproductive health decisionmaking

• Emergency condition protection

• COVID-19 exposure notification, workplace standards, Cal-OSHA regulation

• Employee and consumer privacy issues

• Specific industry regulation such as hotel, agricultural, and call-center employers

• State and federal agency changes

• Federal NLRB policies affecting non-union employers

• Recent caselaw affecting rounding, penalties, arbitration agreements and confidentiality

View a copy of the 2023 update via this link.

Cannabis: Now an Equal Employment Opportunity Issue in California

Much has already been made about California’s AB 2188, which prohibits discrimination against employees for the use of cannabis off the job and away from the workplace. The bill amends the state’s Fair Employment and Housing Act (“FEHA”), (controversially) elevating it to the same EEO status as gender, race, religion, sexual orientation, and other categories of (arguably) greater social significance.

The law contains various exceptions such as construction trade workers, employees subject to testing under other state or federal regulations (such as DOT-regulated truck drivers), and workplaces with mandated Drug Free Workplace programs. It also applies only to employers with five or more employees otherwise covered by the FEHA.

It will create difficult issues for employers, who may test for the presence of cannabis but may not rely on “nonpsychoactive cannabis metabolites.” Employers will need to use potentially more invasive “alternative tests” such as “impairment tests, which measure an individual employee against their own baseline performance and tests that identify the presence of THC in an individual’s bodily fluids.”

It is an open question whether the law will ever take effect. First, the law is not effective until January 1, 2024, leaving plenty of time for courts and the legislature to consider its validity.

Second, though mirroring state-law protection of lawful off-duty off-premises conduct, it violates state-court precedent protecting employers from requirements to accommodate cannabis. This issue was addressed more than a decade ago, when cannabis proponents argued that medical use of marijuana was protected by existing FEHA requirements. Faced with this question, the state Supreme Court held that neither the FEHA nor the state’s medical marijuana laws require employers to accommodate cannabis use because, regardless of its state-law status, the substance is unlawful under federal law. The case, Ross v. RagingWire Telecommunications, Inc., can be viewed online here.

Cannabis remains unlawful under federal law, though the bill’s proponents likely believe that more progressive administrations will argue against its preemption. This creates an interesting issue for the courts, who may need to interpret the interplay between state and federal law without clear guidance.

AB 2188 can be viewed on the California Legislative Information site by clicking here.

Equal Pay Act: A Cautionary Tale

One California appellate court opinion highlights risk under the state's recently expanded Equal Pay Act ("EPA"). The EPA requires equal pay for employees who perform “substantially similar work” when viewed as a composite of skill, effort, and responsibility. Initially applied to differences in sex, the law has been expanded to include race and ethnicity as well.

Unlike federal law, which has stricter requirements, the state law applies to 'similar' (rather than nearly identical) work. It also requires equal pay among different establishments, prohibits retaliation, and requires that any 'bona fide' justification account for the entire difference in pay. The law is discussed on the Labor Commissioner's website here.

In the recent opinion, Allen v. Staples, Inc., a female employee argued that she had not been paid the same for substantially similar work performed by male employee(s). The trial court had dismissed her claims on the basis that men and women had made more or less than one another, without apparent bias toward women. The appellate court noted that, during Allen's employment, "women were among the highest earning" in her position and "at least six men earned less than" her.

Unfortunately, however, there was one male employee who made more than Allen in the same position. The court reversed the trial ruling, reinstating the case, on the basis that "a plaintiff claiming gender-based pay disparity may establish a prima facie case by showing that she was paid less in salary than a single male comparator." The case will be sent back to the lower court for trial even though the appellate court agreed that Allen had not shown evidence of actual discrimination or harassment, upholding dismissal of most of her claims.

The employer will have an opportunity to justify the difference with legitimate factors (such as tenure at the company), but it will have to present that defense at - or settle with Allen before - an expensive trial.

This case may not remain published or could be reviewed by the Supreme Court. Other appellate courts might also disagree. But Allen is a strong cautionary tale for employers who pay too little attention to differences in salary between employees.

Allen v. Staples, Inc. can be viewed here.