Starting in 2021, small employers (with five or more employees) need to begin providing leave under the California Family Rights Act (CFRA). CFRA was originally passed into law in 1993 and affected companies with more than 50 employees. Beginning on January 1st, 2021, CFRA will apply to companies that have five or more employees, with at least one employee in California.

On September 17th of 2020, California’s Governor Newsom signed SB1383, also known as “Unlawful employer practice: California Family Rights Act”, which expands leave protections available to employees under CFRA.

Employers need to update employee handbooks effective January 1, 2021. Small employers need to add a CFRA section and larger employers need to update the CFRA section of the handbook to comply with the new law.

Employers who were previously exempt from CFRA need to develop the required leave administration procedures and documents. Documents are California specific and cannot be copies from previous FMLA forms or from the U.S. Department of Labor website. The Department of Fair Employment and Housing will have updated forms by January 2021 that employers can use.

The highlights of SB1383 include:

• Employers with five or more employees (full and part time employees) must provide up to 12 weeks of unpaid job-protected family leave annually.
• Qualifying reasons for a leave include an employee’s own serious health condition, caring for a family member with a serious health condition, bonding with a newborn, adopted child, or foster child. Also, for a qualifying exigency dealing with covered active duty, or call to covered active duty, of the employee’s spouse, domestic partner, child, or parent in the Armed Forces. The last reason is NEW to the CFRA requirements.
• Employees must be employed for at least 12 months and have worked a minimum 1,250 hours during the last 12 months to qualify for CFRA.
• There is no requirement the five employees be within a 75-mile radius (unlike the FMLA requirements). Businesses with as few as five employees company-wide (counting employees in and out of California), must comply with the new law for all California employees.
• CFRA will run concurrently with FMLA if the leave is covered under FMLA. Employees can take 12 weeks of job-protected CFRA leave for personal medical conditions (unless leave is taken for pregnancy, childbirth, or medical conditions covered under Pregnancy Disability Leave).
• Family members previously covered by CFRA leave included the employee’s parent, child, spouse, or domestic partner. Under SB1383, employees may now also take leave to care for an adult child,  grandparent, grandchild, or sibling. FMLA does not provide job-protected leave to care for a grandparent, grandchild, or sibling. This means an employee who takes 12 weeks of leave to care for family members under CFRA is still eligible for 12 additional weeks of job-protected leave for other qualifying reasons if eligible for FMLA. This situation would only apply to larger employers that are covered by both CFRA and FMLA.
• When an employer employs both parents of a new child, SB1383 requires the employer provide both parents 12 weeks of job-protected leave for bonding (even when employees take leave at the same time). This is different than FMLA, which allowed employers to split the 12 weeks between the two employees.
• SB1383 eliminates the “key employee” exception, which allowed employers to not reinstate a salaried employee in the top ten percent of the company.

Employers who were previously covered under CFRA and FMLA will also need to be aware of the new requirements. SB1383 increases the type of family members an employee can take leave to care for, changes the leave available to parents for baby bonding (when they work for the same employer), and removes the “key employee” provision.

Employers also need to understand the interplay between Pregnancy Disability Leave (PDL) and CFRA. These two leaves do not run concurrently. A pregnant employee is entitled to up to 17 1/3 weeks of Pregnancy Disability Leave and an additional 12 weeks of leave under CFRA leave. This means your employee could be off work more than seven months and you are legally required to hold their position.

Leave of absence under CFRA does not require the employer to pay the employee during this time off. Companies should allow the use of any company paid time off programs. However, depending on the reason for leave, many employees will also be eligible for California’s partial income replacement program called Paid Family Leave (PFL). PFL provides up to eight weeks off for eligible absences and typically provides between 60-70 percent income replacement.

This is a substantial change that impacts nearly all California employers.
 
There are strategies for reducing the burden of CFRA leave requests: cross training employees, partnering with temporary or contract services to fill absences, encouraging open communications with employees (so you get advance notice and can plan). Leave of absence administration can be challenging. In preparation for this change in 2021, employers should become familiar with the regulations, update the employee handbook and workplace posters, and develop a process for evaluating, responding to, and documenting leave requests. Employers need to make sure requests for CFRA leave does not factor into employment decisions (such as disciplinary action, pay increases, or promotional opportunities).

One best practice is to provide employees a written leave of absence letter which outlines the request for time off, whether it is approved, the duration, income replacement options, benefits coverage, payment during their absence, their responsibilities, and who to contact if they have questions. If you are not sure of how to handle a leave of absence request, get professional help from a qualified Employment Attorney or HR Consultant.

Many technical aspects of CFRA leave are outside the scope of this summary. If you need help navigating the new CFRA or with other Human Resource issues, reach out to North County HR at laura@northcountyhr.com or 760-390-7357. We specialize in HR, small businesses, and California compliance and look forward to working with you.
​
This article provides information only and should not be construed as legal advice.

      It’s frustrating.  You had a truly terrible employee.  Finally, you were able to move them out of the company, and then they file for unemployment, which impacts your unemployment insurance (UI) rating.  You fill out the EDD questionnaire to appeal their claim, but it seems like the employee always wins.  Is it worth it to attend the EDD hearing?  It takes time to attend the hearing and prepare your materials.  It’s important to know when to fight it and how to prepare if you decide to win your case.
      When should you fight an unemployment claim and when does it not make sense?  It is very time consuming to not only attend the hearing, but to prepare your supporting documentation.  There is a chance you will not win.  The employee is almost always eligible if they lose their job through no fault of their own, such as in a layoff or termination due to work quality or quantity. If this is the case, don’t bother to attend the hearing. You will not win. On the other hand, the employee is usually NOT eligible when they voluntarily quit or accept another job.  This is one reason that it is a best practice to get any voluntary resignation in writing. This document will easily make your case in the event of an unemployment dispute. The claim employers most often want to appeal involves gross misconduct. Some examples of gross misconduct include: dishonesty (such as theft, embezzlement or falsification of timecards), intoxication on the job and extreme insubordination. Check the EDD website to see if your issue is considered misconduct. You have a good chance of winning the appeal if you can show solid evidence of gross misconduct. 
The EDD hearing is a formal legal proceeding, which takes place in front of a judge.  You will be sworn in and then you will testify, along with your former employee and any witnesses either side provides. Later in the process you will have a chance to question the employee and any witnesses. Take notes throughout the process so you know which questions you will ask when it comes your time to ask questions.  It’s best to focus on the critical items, what the employee was terminated for, and avoid bringing up every grievance you had with the employee.  Don’t get stuck in the weeds. 
      The best way to improve your chances of winning an appeal of a claim is to be prepared.  This means presenting thorough documentation that explains what transpired with your former employee.  If you know that you intend to fight any unemployment claim, you should start gathering and organizing documentation before the employee even files. Don’t just provide every document in the employees personnel file. Carefully select the documents, notes, performance documentation, reports, emails, and witnesses that demonstrate what your employee did. Help the judge by painting a picture of what transpired with specific documentation and testimony.
Prepare 3 copies of any document you plan to use as evidence.  One copy is for you, one for the judge and one for your former employee.  Any written material that you will be providing to the judge must also be given to your former employee to review at the hearing. Prepare a written summary of the key events.  This summary should include: the employee’s name, title, hire date, and termination date, a timeline of the course of events, including a history of the critical incident or issues and notes on how you allowed the employee to improve OR how you allowed the employee to respond to any wrongdoing. If you provide complicated reports or company documents, highlight what the material is illustrating. If the documents contain industry or company specific language or jargon spell out their meanings for the judge. Make sure you include copies of any notes or documents, such as verbal warnings, written warnings, performance evaluations, or emails documenting the specific issue that resulted in the termination. If there are pictures or video from security footage that is relevant be sure to provide that as well.
      On the day of the hearing make sure you are organized. Bring a copy of the hearing notice. Take note of the address and start time. Plan to arrive early and account for any possible traffic and parking delays. Bring any relevant witnesses. Appropriate witnesses are people who have first-hand knowledge of the specific issues you will be covering in the hearing. This is typically the former employee’s manager and / or any employees who may have witnessed the gross misconduct. It is perfectly acceptable to review testimony with your witnesses before you are called in front of the administrative law judge. You may provide a written statement in lieu of testimony. However, this is not recommended since a written statement is not granted the same weight since it cannot be cross examined. Although you are likely irritated with your former employee, refrain from attacking or smearing their reputation. Be professional and present the facts without editorializing to the judge.
However frustrating and time-consuming it may be to appeal an unemployment claim that you feel is unjustified or unfair, it could be worth it.  If you are prepared and have thorough documentation that shows gross misconduct, it will greatly improve your chances of winning an appeal at an EDD hearing. Good luck and let us know if you win!

​            If you haven’t already, it’s time to review your wage strategy for the next few years.  Wages in California used to be a lot simpler.  There was just one minimum hourly rate and one minimum salaried rate. These days there are many more complexities.
            If your employee qualifies as a salaried exempt employee under the administrative, professional, or managerial exemptions, you must pay them at least the minimum salary.  That wage is tied to twice the minimum wage multiplied by 2,080 hours per year.  For employers with 25 or fewer employees, it is $45,760 in 2019.  For employers with greater than 25 employees, the rate is $49,920.  This minimum salary still applies even if the person works part-time hours.  It cannot be prorated.
            There are also two different minimum hourly rates in 2019.  The minimum wage for employers with 25 or fewer employees is $11 an hour and $12 per hour for employers with over 25 employees.  In addition to these two different levels of California minimum wage requirements, there are 23 cities or local ordinances within California (including the City of San Diego) that have adopted their own minimum wage.  There are very few exceptions to the minimum wage rules.
            If you have any sales people who are under the inside sales exemption you also need to review their compensation as well. Inside sales people can be exempt from overtime if their earnings paid in each pay period exceed 1 ½ times the minimum wage and more than half the employee's compensation represents commissions. Be careful with this exemption, it is very narrow and different from the other white collar exemptions.
As minimum wage increases, it leads to wage compression.  This occurs as new workers are hired at nearly the same rate as workers with more skills, experience, or seniority.  Or you hire a lower level employee at a rate closer to that of a high-level employee, such as a manager.  Unless there is a plan in place to account for this problem, it can lower morale and lead to decreased productivity and increased turnover.
            There are other considerations going forward.  As minimum wage continues to rise, wage compression continues to put pressure on all middle level jobs.  In addition to the increase in wages, consider the other rises in costs that are tied to wages, such as payroll taxes, workers comp insurance, vacation and sick pay costs and other similar expenses.  An important part of your wage strategy should be to review pricing for products or services.  Since wages typically make up a large percentage of a business’s expenses, determine if and when you will have to adjust the pricing of your products.  Should you do it in one change that takes into account all the wage increases through 2023?  Or will you make a few gradual increases as wages rise?  Another consideration is that your suppliers and vendors may also be raising their prices to you as they contend with the same issues.  Many restaurants have taken the strategy of adding a surcharge to food.  This allows them to keep the published menu price the same, while identifying this increase as directly tied to the increase in the minimum wage (and often sick time requirements).  Higher level jobs are also impacted.  Since the minimum salary for exempt workers is tied to California’s minimum wage, by 2023 that salary will rise from current levels ($43,680 for smaller employers to $45,760 for those with 26 or more) to a whopping $62,400.  Now is the perfect time to consider your wage strategy for the next few years.  

​We know…. You’re a small company with a lot of responsibilities and expenses.  There is no way you could offer Paid Time Off to your staff. But what if you could offer PTO to your employees at the same time you reduce unplanned absences and increased your benefit offerings in the eyes of your employees? Many savvy California employers are considering offering PTO instead of sick leave. Before making this decision, make sure you understand the advantages and disadvantages to each approach and determine which plan is best for your business. 
            Did you know that since 2015 nearly all businesses in the state of California are required to provide paid sick leave (PSL) to employees? In addition to the California requirements, over 20 cities and local ordinances (including the city of San Diego) have their own sick requirements which often provide a greater benefit than the California plan. Therefore, if you have employees scattered across California you may have to understand, provide and administer several different sick leave policies. The sick leave requirement allows companies to meet the sick requirements through their own sick or PTO plan as long as that plan meets all the requirements of California’s Paid Sick Leave. A few of those requirements include posting and notification requirements, properly calculating and accruing or granting the leave, and other components of implementation.
            Sick calls are particularly challenging in a small businesses with limited staff. As California employees have gotten used to seeing sick leave on their paystubs (a requirement of the PSL law), employers have started to notice a disturbing trend - The frequency of sick calls has increased! Sick leave is use it or lose it and employees realize if they don’t take it they won’t be able to bank the time for future sick needs or be cashed out upon termination. This tends to reward poor employees (those willing to call in sick when they are not sick) and does nothing to reward those who would never call in sick unless they were truly ill.
            Why consider offering PTO instead of sick?  Employees tend to prefer Paid Time Off and see it as a benefit offering vs. a statutory mandated requirement.  PTO provides employees with one bank for vacation, sick or personal time and allows them to use it as appropriate for their circumstances. Employees enjoy the flexibility in how the time is spent and prefer not having to call in “sick” when they are not.  For employees that are never sick, they can use the time for vacation or personal usage. For those employers who had typically offered sick, vacation and personal time, it allows them the convenience of managing only 1 leave bank. Also, for most employers it tends to reduce the amount of unexpected sick calls since employees can request PTO ahead of time instead of feigning illness. One important drawback to PTO is that it must be paid out at termination, unlike paid sick leave.  Also, you must allow the maximum PTO bank to be 1.5X the employees’ annual accrual rate.
Offering PTO in lieu of sick is not for every business. If you do elect to offer PTO consider if the accrual method (when employees earn a small chunk of PTO each payroll instead of being granted the full amount when they become eligible) or grant method (providing the full amount by the required date) makes more sense for your business. It’s also important to cap the maximum PTO employees can have in their bank to limit your liability when an employee terminates employment. No matter which method you choose make sure you a strong payroll partner to help you track and accrue the leave as well as a written company policy in place that is clearly communicated to your employees.  There are many requirements and nuances to the sick leave and PTO requirements so be sure to get help from a professional before you implement a new policy. Check out our cheat sheet at http://www.northcountyhr.com/resources.html to see more of the advantages and disadvantages of each type of plan. 

​     You spend a considerable amount of time trying to find just the right candidate for the job.  You filter through applications and resumes, conduct interviews, and way pros and cons. You’ve offered the job contingent on passing the background check.  Just when you think you’re ready to hire the perfect candidate, a red flag goes up upon receiving the background check results.  What do you do now?  Legally there are steps you must take if you are considering rescinding the job offer due to a criminal conviction.  Background checks, including criminal convictions, are regulated by the FCRA (Federal Credit Reporting Act). The intent of the FCRA is to provide and fair and accurate summary of this data for consumers and applicants.
     Let’s say you discover a criminal conviction.  Before you decide to deny an applicant, you must determine how that conviction affects the job, known as an “individualized assessment”.  The intent of the individualized assessment is to determine if the conviction has a direct and adverse relationship with the specific job duties that justifies the employer denying employment. What is the nature and gravity of the offense? How long ago did it happen?  Was it job-related or would it impact the specific job you are offering the candidate?  For example, it may not make sense to decline a candidate with a felony DUI conviction if their role in the company doesn’t include any driving activities. However, you could easily justify denying a candidate with an embezzlement conviction for a job as your CFO. This is also the time to engage with the applicant to hear their side of the story. There may have been extenuating circumstances or a narrative of personal growth and rehabilitation since the conviction.
     After this consideration, if you still feel the conviction may be a deal-breaker, the next step is the notice requirement.  There are two parts.  The first notice, the pre-adverse action notice, is a letter stating that the background check results are being reviewed and a decision is pending.  Include a copy of the report and a “summary of your rights under the fair credit reporting agency act”, informing them that they have an opportunity to respond and the deadline.  Keep copies of everything.  Then wait at least five business days for a response.  This gives the applicant a chance to explain or dispute the findings.  You must consider any response before making a final decision.   If they notify you within those five days that they are collecting evidence or working on their response, you must give them five additional days.
     So, now it’s been five days since the first notice letter was sent.  Either there has been no response, or you have received an explanation from the applicant arguing his case.  You considered all the available information and have decided that you still want to rescind the job offer.  Now you must send the second notice, the Adverse Action Notice.  This must specifically express denial of employment and that it was due (or partially due) to the results of the background check.  You should also include the contact information for the vendor that performed the background check on your behalf. Include procedures for challenging the decision or requesting reconsideration and notice of the right to file a complaint with the California Department of Fair Employment and Housing.  Keep copies of everything.
     It would be a shame to lose a prospective applicant due to an unfortunate blemish on a background check.  We would all love to be the giver of second chances, but sometimes it isn’t a sensible decision for your business. By making sure you follow the Fair Credit and Report Act, you can protect yourself from legal action and know that you’ve done the right thing.

​            In the age of the #metoo movement, sexual harassment training has never been more important.  There are a variety of reasons why hiring an external trainer is a better choice than conducting the training in-house.  Your internal Human Resources team may not be an expert in this area.  It’s critical that the most up to date information is presented. When professional development training comes from the outside, it shows a commitment to the topic, so people are more likely to pay attention and attend the training.  Most importantly, who has the time?  Developing engaging content and materials is time-consuming.  Why not hire an expert so you can focus on other Human Resources priorities?
            Chances are good that your Human Resources team does not have a lot of experience dealing with sexual harassment.  They may have never investigated a claim or had to assist a victim or deal with an aggressor.  Trainers are required to have at least 2 years of experience in training, investigating, and advising.  The federal and state laws are constantly changing, such as the new 2018 requirement to cover gender issues and sexual orientation.  How can you be sure your team is up to date on the latest topics?  Popping in a video is not enough. Training is required to be interactive and should include features such as role playing, reviewing industry-specific scenarios and include a question and answer segment.
All companies in California with 50 or more employees must provide at least 2 hours of training to all supervisors within 6 months of hire and every 2 years after.  These are very busy people for whom attending a mandatory 2-hour training can be difficult.  A professional trainer with practical experience, interesting anecdotes, and well-made training materials is more likely to present the topic in a meaningful way that engages the trainees.  You want them to feel that the training was beneficial to them, and not a waste of company time. 
            Busy Human Resource personnel are rarely idle.  Managing benefits packages, compliance reports, hiring and firing, counseling, and all the other requirements of the job leave little time to develop engaging content and materials. A professional trainer will ensure the content is customized for your business, meets the California training requirements and is delivered in a timely manner. Your trainer can customize your training to include specific topics related to professional behavior in the workplace such as discrimination, bullying, respect in the workplace and other company-specific behaviors you want to include.
Providing accurate, engaging, and up to date sexual harassment training is mandatory and necessary.  Consider hiring a professional to conduct your next sexual harassment training. In this climate, it’s too important to skimp in this area.  Replace #metoo with #nothere at your company.
#Sexualharassment
#sandiego
#sexualharassmenttraining
#professionalismtraining
#nothere
laura@northcountyhr.com
 

​How can I offer alcohol at our holiday office party and make sure it doesn’t get out of hand?
            Hosting a holiday party for your staff is a nice way to reward them for their hard work during the year.  If you are considering offering alcohol at the party, here are some tips you may want to consider.
            Preparation starts before the party.  When you provide the details, mention that alcohol will be served and ask people to drink responsibly.  Encourage them to select a designated driver.  Provide options for those who may overindulge.  You might want to consider offering to reimburse for an Uber (both directions) for any employees who wish to take one home.  Or if a hotel is nearby, see if you can obtain a discounted group rate in advance for those who wish to stay
With a large group, you can’t keep an eye on everyone.  It is essential that you enlist help.   Talk with the bartender / waitstaff at the beginning of the party.  They should stop serving anyone who is visibly intoxicated.   Also, ask them to inform you of anyone who is cut off.  Request that the managers monitor those at their table throughout the evening.  You might also assign a greeter as guests start to leave.  If someone is intoxicated, they can intervene and help find a safe ride home.
            Any of these ideas can help ensure that you and your employees will have a safe, enjoyable, and memorable holiday gathering. 

What is the purpose of the I9 form? The I9 verifies that an employee is legally eligible to work in the United States. The intent of the I9 is to establish 1) identity and 2) eligibility to work in the United States. Employers may NOT hire employees that are not eligible to work in the United States. Employers must complete an I9 for all employees upon hire.
When do I complete it?

• You may NOT complete the I9 as part of pre-employment screening. It is completed after an employee has been offered a job.
• Section 1 must be completed by the end of the first day of work.
• The remainder of the form must be completed by the close of business on the 3rd day of work.  
• If an employee fails to produce the required documents you should terminate their employment immediately.

What if my employee is remote?

• Documents must be verified in PERSON. You can appoint someone as your representative to complete it. Some employers will use a Notary to do this. You can use a notary since they will likely pay close attention of the requirements. However, they would not notarize the I9 (as that would be notarizing their own work). They would simply verify and complete the document as your representative. The same person who verifies the provided documents must also complete the employer sections of the I9 form.

Where can I get more information on tricky situations or unusual documents?

• The Handbook for Employers put out by US Immigration Services is very helpful for unique situations. It’s long, but searchable: https://www.uscis.gov/sites/default/files/files/form/m-274.pdf.  

How do I correct an error on an I9?

• Draw a line through the incorrect information. Write the correct information on the same form and initial and date it.
• Forms should never be backdated. If several errors are made, a new form may be completed, but it must be attached to the original. If necessary, attach a memo with the reason for the correction(s).

How do I store I9’s? What are the retention requirements?

• They should NOT be stored in the employee's personnel file.
• You may keep copies of the support documents provided, but you are not required to do so. Follow the same procedure for all new hires.
• You must retain original I-9 forms for three years after the date of hire, or one year after the date employment ends, whichever is later. 

Which is the current version of the I9?

• The one that has 11/14/16 on the bottom left corner.

 
Understanding acceptable documents

• You may NOT specify which type of documents an employee must provide.
• An employee may provide any single document from list A document OR one document from list B AND list C.
• Original documents must be provided. A certified copy of birth certificate is the only exception.
• If an employee presents you with a document on the list, and it appears to be valid, you may accept it. You are not required to be a document expert.
• Some employees will provide work authorization dates with an expiration date on them. You must reverify their work eligibility when their authorization expires in section 3 of the form.

 
What else?

• Employees responsible for completing I9’s should be trained.
• I9 compliance audits are expected to increase under the current administration.
• Avoid illegal discrimination of employees during the I9 process by treating individuals equally when recruiting and hiring, and when verifying employment authorization and identity.
• There are many additional nuances to the I9 process. If in doubt, refer to the employers guide listed above or the website: www.uscis.gov.  
• There is civil and criminal liability associated with the completion of I9’s. Fines can be substantial.   
• Some employers (such as government contractors) are required to use E-Verify along with paper I9 forms. 

The best way to explain a resume gap? It depends on the reason for the gap. Always be honest, but of course put that gap in the best possible light.

• Minimize obvious gaps when possible. For example, if you were laid off in February and rehired at the next job in October of the same year, your resume could list only years (not months). When filling out an application, you need to provide complete dates, but at the screening stage, employment gaps are less obvious if you use this format.
• Let say you were laid off and simply searching for work. What did you do that was constructive during that time? Possible examples could be: completed a certificate program, reconnected with your network, traveled, did consulting or part-time work, helped a spouse with their business, read business books, volunteered, reevaluated and re-positioned your skill set for another role, enjoyed time-off due to a generous severance package. These are all acceptable activities as long as you have a reasonable explanation and time-frame. A great place to explain a recent resume gap is on your cover letter.
• What if you were dealing with a personal health issue or taking care of an ill parent or dealing with a family tragedy? It’s okay as long as the absence from work was for a reasonable time and you provide an explanation. When explaining to the interviewer, don’t get emotional and provide only a brief explanation. The interviewer wants to be sure your personal situation is squared away so that you can focus on your new role.