Season’s greetings! Ready or not, a new year starts in just a few weeks. This update will help you prepare. Since many new rules are currently in flux, if you are flummoxed by these changes, reach out to Our Team for help with navigating the path forward.

Key New Employment Laws for 2023

We have more ground-breaking laws to become aware of for 2023. Below are key highlights. Good timing to update your Employee Handbook! Unless otherwise specified, the following will go into effect January 1, 2023.

SB 1162 “Pay Transparency”: California employers must include a position’s salary or hourly wage range (not including bonuses or equity-based compensation) in any internal or external job posting. This requirement extends to job postings published by a third party at an employer’s request. This new law further expands this requirement to cover current employees who request the pay scale for the position in which they are currently employed. The requirement to share wage range information with current employees and applicants applies to all employers in California, including those with fewer than 15 employees. It also establishes a civil penalty of up to $10,000 per violation of its pay scale disclosure and job posting requirements. Further, for employers with 100 or more employees there is an annual requirement to report pay data on each of 10 specified job categories to the California Civil Rights Department (CRD). Beginning May 2023, SB 1162 expands these reporting requirements to include the median and mean hourly rate, broken down by race, ethnicity and sex. Finally, the law eliminates the requirement that employers with multiple establishments provide both a consolidated report and a separate report for each establishment. Instead, employers need only provide a report for each establishment.
SB 523 “Contraceptives Equity Act”: Employers will be prohibited from discriminating against an applicant or employee based on their reproductive health decisionmaking. The law makes it clear that discrimination based on “sex” also includes reproductive health decisionmaking.
AB 1041 Expansion of CFRA and Paid Sick Leave to Cover “Designated Person”: This law expands the class of people for whom an employee under the California Family Rights Act (CFRA) may take leave to care for to include any “Designated Person,” defined as any individual related by blood or whose association with the employee is the equivalent of a family relationship. The designated person pay be identified by the employee at the time leave is requested.
AB 1949 Expansion of CFRA to Offer Bereavement Leave: This law amends CFRA to require private employers with 5+ employees to provide eligible employees with up to 5 days bereavement leave within 3 months of the death of the employee’s spouse, child, parent, sibling, grandparent, grandchild, domestic partner, or parent-in-law. The 5 days need not be taken consecutively. Eligible employees are those who have been employed at least 30 days prior to the leave request.
SB 1044 New Protections in the Event of an Emergency: This new law prohibits employers from taking or threatening to take an adverse action against employees who, in the event of an “emergency condition,” refuse to come into work or leave work due to a reasonable belief that the worksite is unsafe. “Emergency condition” is defined to mean a disaster or extreme peril to the safety of person or property at the workplace caused by natural forces or a crime, or an evacuation order due to a natural disaster or crime at the workplace, an employee’s home, or their child’s school. It specifically excludes health pandemics.
AB 1044 New Protections in the Event of an Emergency: This new law prohibits employers
AB 2188 Expansion of Protected Categories under FEHA: Beginning January 1, 2024, employers will be prohibited from discriminating against applicants and employees based on their off-duty use of cannabis away from the workplace. The new law also prohibits discrimination based on a drug screening test that detects nonpsychoactive cannabis metabolites in their hair, blood, urine, or other bodily fluids. According to the Legislature’s findings, once the chemical in cannabis that causes impairment is metabolized, it’s stored in the body as nonpsychoactive cannabis metabolites. Based on the Legislature’s findings, such metabolites indicate only that the individual has consumed cannabis in the last few weeks but do not cause impairment. The bill contains exceptions for employees in the building and construction trades and applicants and employees hired for positions that require a federal government background investigation or security clearance.

M I N I M U M W A G E H I K E S F O R J A N 1

Beginning January 1, 2023, the California state minimum wage will be $15.50 per hour for all employers, regardless of size. This state minimum wage rate is also used to determine the salary threshold for the administrative, executive and professional exemptions — the threshold is two times the statewide minimum wage. This means, for 2023, you will need to ensure all exempt employees earn at least $64,480 per year.

In addition and across the state, various cities and counties have adopted a higher minimum wage rate higher than the state that applies to hourly workers. Beginning January 1^st, cities including San Diego, San Jose, Sunnyvale and more will follow a higher minimum wage for employers regardless of size. The good news is that the minimum acceptable salary for exempt employees remains at twice the state minimum wage, regardless.

Also effective January 1, 2023, the minimum rate for exempt computer professional employees increases 7.6% to $53.80 per hour, or a salary of at least $112,065.20 annually ($9,338.78 monthly). Read more about it here.

Below is the growing list of cities with new Minimum Wage Rates starting Jan 1:

Belmont: $16.75/hour;
Burlingame: $16.47/hour;
Cupertino: $17.20/hour;
Daly City: $16.07/hour;
East Palo Alto: $16.50/hour;
El Cerrito: $17.35/hour;
Foster City: $16.50/hour;
Half Moon Bay: $16.45/hour;
Hayward: $16.34/hour for employers with 26 or more employees; $15.50/hour for employers with 25 or fewer employees;
Los Altos: $17.20/hour;
Menlo Park: $16.20/hour;
Mountain View: $18.15/hour;
Novato: $16.32/hour for employers with 100 or more employees; $16.07/hour for employers with 26–99 employees; $15.53/hour for employers with 1–25 employees;
Oakland: $15.97/hour;
Palo Alto: $17.25/hour;
Petaluma: $17.06/hour;
Redwood City: $17/hour;
Richmond: $16.17/hour;
San Carlos: $16.32/hour;
San Diego (city): $16.30/hour;
San Jose: $17/hour;
San Mateo (city): $16.75/hour;
Santa Clara: $17.20/hour;
Santa Rosa: $17.06/hour;
Sonoma (city): $17/hour for employers with 26 or more employees; $16/hour for employers with 25 or fewer employees;
South San Francisco: $16.70/hour;
Sunnyvale: $17.95/hour;
West Hollywood: $17.50/hour for employers with 50 or more employees; $17/hour for employers with fewer than 50 employees.

New Employment Laws, Jan 1 Minimum Wage Increases and More