California Enacts New Employment Laws For 2017

California Governor Jerry Brown concluded the 2016 Legislative Session by signing several bills affecting employment relationships. Listed below are those bills that perhaps most critically impact your daily operations. Unless stated otherwise, these new laws take effect January 1, 2017.

Juvenile Arrests and Convictions Removed From Employee Background Checks (AB 1843)

AB 1843 expands state background check laws to prohibit (with narrow exceptions) employers from inquiring into or using information regarding an applicant's juvenile criminal background, including juvenile arrests, detentions, processings, and adjudications. Pre-existing California law prohibited the vast majority of employers from seeking information about or asking job applicants to disclose: 1) information related to an arrest or detention that did not result in a conviction; 2) information related to participation in a pre- or post-trial diversion program; 3) dismissed or sealed criminal convictions; or 4) marijuana-related convictions over two years old. AB 1843 provides that the "conviction" allowing inquiry does not include juvenile court adjudications. Health facility employers may seek information on a few crimes (related to sex and drugs) committed within 5 years of the application. Such employers now must provide the applicant with a list of those offenses for which disclosure is being sought.

Restrictions Against Non-California Forum and Choice of Law Provisions in Employment Agreements (SB 1241)

SB 1241 adds Section 925 to the Labor Code, which will prohibit employers from requiring California employees to adjudicate claims outside of California or to submit to the laws of another state. Section 925 applies to all employment contracts, including arbitration agreements, that are entered into, modified, or extended on or after January 1, 2017. The only exception is where the employee had individual attorney representation in negotiating the employment agreement. Employees who enforce their rights under Section 925 may be awarded attorneys' fees. Section 925 will effectively preclude most efforts to apply restrictive covenants or to otherwise avoid unique California law through foreign forum or choice of law clauses. Moreover, employers should avoid terminating employees for refusing to sign agreements that would violate Section 925.

Exempt Employees' Wage Statement Need Not List Hours (AB 2535)

AB 2535 revises California Labor Code § 226 to clarify that employers...