COVID-Related Legislation in California

Employment Law

In California legislative updates, Gov. Gavin Newsom signed SB 93 into law, requiring that hospitality industry employers offer workers laid off due to COVID-19 positions based on a preference system, while lawmakers continue to debate, in the form of AB 650, a retention bonus for health care workers.

As the state continues to slowly reopen, employers in the hospitality industry looking to hire employees must first reach out to those laid off due to the pandemic.

SB 93 took immediate effect on April 16 and applies to hotels, private clubs, event centers, airport hospitality operations and service providers, and providers of building services to office, retail or other commercial buildings.

Workers employed by covered employers for six months or more in the 12 months prior to January 1, 2020, and whose most recent separation was for a COVID-related reason—including a public health directive, government shutdown order, lack of business, a reduction in force, or other economic, nondisciplinary reasons related to the pandemic—must be offered positions they are qualified for before new employees are hired, pursuant to the law.

A laid-off employee will be considered qualified if he or she held the same or similar position at the time of layoff, and must be given at least five business days to respond to the offer. If multiple laid-off employees would be entitled to a position, the employer must offer the position to the employee with the greatest length of service, based on the date of hire.

If an employer declines to make an offer to a laid-off employee based on a lack of qualifications, the employer must provide the employee written notice within 30 days.

The Division of Labor Standards Enforcement (DLSE) was tapped to enforce the new law. Pursuant to SB 93, employees can file complaints with the DLSE about potential violations, with the possibility of hiring and reinstatement rights, front pay or back pay for each day the violation continues, and the value of the benefits the laid-off employee would have received under the employer’s benefit plan.

In addition, violations of the law can subject employers to a $100 civil penalty per employee, along with $500 in liquidated damages for each day of violation. No private right of action is included in the law.

The law will sunset on Dec. 31, 2024.

In addition to the new state law, several local jurisdictions have enacted their own recall ordinances. The Los Angeles, Oakland and San Diego ordinances all focus on the hospitality industry, similarly to SB 93, while San Francisco’s ordinance applies to all employers operating within the city that employed 100 or more employees and laid off 10 or more employees working in San Francisco within a 30-day period.

Another issue facing the legislature: hazard pay or pay retention bonuses for certain categories of workers due to COVID-19.

Cities including Berkeley, Irvine, Long Beach, Los Angeles and San Jose have all enacted “hazard” or “hero” pay ordinances over the months that provide for premium pay for employees of various retail establishments, particularly grocery and drugstore employees.

The state legislature is considering a measure in a similar vein. AB 650 would create pay retention bonuses for employees in the health care industry in recognition of their hazardous work. The bonus would be paid on top of all other compensation and would not be part of an employee’s regular rate of pay or compensation.

In addition, covered employers would run afoul of the bill if they discharge, lay off or reduce a covered health care employee’s compensation or hours to prevent that worker from receiving the bonus.

“Covered workers” is broadly defined to include those who provide “direct patient care or services directly supporting patient care at or for any covered employer, and includes, but is not limited to, pharmacists, clinicians, nurses, aides, technicians, janitorial and housekeeping staff, security guards, food services workers, laundry workers, nonmanagerial administrative staff and physicians if they are employees of a health care provider.”

Employees must have worked at any time in the 2020 calendar year, for at least 500 hours in the 2021 calendar year and anytime during the 2022 calendar year.

The bonuses would be paid on January 1, 2022, April 1, 2022, July 1, 2022 and October 1, 2022: $2,500 for full-time employees, $1,500 for those employed part-time and $1,000 for less than part-time employees.

To read SB 93, click here.

To read AB 650, click here.

Why it matters: Because SB 93 took immediate effect, California hospitality industry employers should carefully evaluate their hiring practices in light of the new law, while employers in the health care industry should monitor the progress of AB 650, which is currently being considered by the Appropriations Committee.



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