New laws for 2017

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All laws effective January 1, 2017, unless otherwise indicated

AB 287: Vehicle safety recalls

Current law: Federal law prohibits dealers and rental car companies that maintain a fleet of 34 or more vehicles from renting or loaning a vehicle that has an unrepaired safety recall.

Changes from this law: Prohibits dealers and rental car companies with less than 34 vehicles in the fleet from renting or loaning a vehicle with an unrepaired safety recall. If a recall repair is not available but the manufacturer identifies a temporary fix, the dealer may rent or loan the vehicle after the temporary repair is made, but must complete the final repair when it is available.

The bill also allows franchised dealers to recover from manufacturers the costs directly associated with disposal of hazardous waste produced during a safety recall repair.

Action required: Do not rent or loan vehicles with an unrepaired safety recall.

Track the costs of disposing of hazardous waste produced while performing a safety recall repair and submit such costs for reimbursement by manufacturers.

AB 516: Temporary license plates

Current law: California allows vehicle delivery without a temporary or permanent license plate.

Changes from this law: Requires the DMV to develop regulations before January 1, 2019, to allow dealers to electronically report vehicle sales and provide a temporary license plate at the delivery of a vehicle.

Action required: No action required currently.

AB 873: Automotive repair regulation

Current law: The Bureau of Automotive Repair regulates the business of automotive repair, excluding “minor services.”

Changes from this law: Requires the BAR to develop regulations to define “minor services,” bringing more service providers into the regulatory scheme.

Action required: No action required. The law will not increase regulation on dealerships; it will regulate more businesses that compete directly with dealership repair services.

AB 1685: Vehicle air pollution penalties

Current Law: The penalty for selling a new vehicle in state that doesn’t meet the emissions standards adopted by the Air Resources Board ranges from $50 to $5,000.

Changes from this law: Increases penalties to up to $37,500 per violation, with subsequent increases for inflation.

Action Required: Ensure that no modifications to new vehicles tamper with or disable emissions controls. Ensure that each new vehicle sold has a CARB sticker indicating compliance with emissions standards.

AB 1732: Access to single-user restrooms

New Law: All single-user restrooms (restrooms intended to be used by a single occupant) in business establishments must be identified as all-gender restroom facilities.

Action Required: Ensure that all signs on single-user restrooms indicate that any gender may use the restroom.

AB 2153: Lead-acid battery recycling

Current Law: All businesses that sell lead-acid batteries must accept lead-acid batteries from consumers in exchange for a new lead-acid battery purchased by the consumer.

Changes from this law: Requires battery retailers to accept used lead-acid batteries for recycling even if a consumer doesn’t purchase a new battery and creates a Lead-Acid Battery Recycling Fund and regulations of battery recycling.

Action Required: Accept all lead-acid batteries turned-over by consumers.

AB 2167: Towed vehicles

Current Law: In 2016, California required dealers to document certain information regarding vehicles delivered to the dealership by tow trucks and to provide that information to law enforcement on request.

Changes from this law: Clarifies how and when franchised dealers must take information from tow truck drivers at delivery. Specifically:

  • If a tow truck driver refuses to provide information, the dealer must document that he or she made a reasonable effort to obtain the information.
  • A franchised dealer is not open for business for the purposes of this law when the repair shop is not open.

Action Required: If a vehicle is dropped off by a tow truck, record all of the following information:

  • Name, address, and telephone number of the towing company
  • Name and driver’s license or other identifying number of the driver
  • Make, model and license plate or VIN
  • Date and time dealer took possession of the vehicle.

If the vehicle is dropped off after business hours, the dealer should make a reasonable effort to obtain this information.

If the tow truck driver or company will not provide information, document reasonable attempts to obtain the information.

Maintain these records for 3 years and provide them to law enforcement when requested.

AB 2828: Data breaches of personal information

Current Law: All businesses must inform customers when there is a breach of customer’s confidential, unencrypted personal information and the business reasonably believes unauthorized persons have access to the customer’s information.

Changes from this law: Businesses must now inform customers of breaches when encrypted personal information is breached and an unauthorized person has the encryption key or security credential to access the information.

Action Required: Ensure that your dealership has appropriate protections in place and follows data security protocols to prevent breaches of customer data.

SB 1399: License plate alternatives pilot program

New Law: The DMV is authorized to conduct a pilot program to study alternatives to license plates, registration cards and stickers. The pilot program must be completed by January 1, 2019.

Employment-related new laws

SBX 2-5, SBX 2-7, ABX 2-7, ABX 2-9 and ABX 2-11: Smoking in the workplace (effective 6/9/16)

Prior Law: California law already prohibited the smoking of tobacco products indoors or in enclosed spaces at places of employment for employers of 5 or more employees. Prior law also exempts workplaces in certain industries from the smoking ban, such as hotel lobbies, banquet rooms, bars, taverns and warehouses. In addition, the legal smoking age was 18 years or older.

Changes from this law: This new series of bills expands the prohibition on smoking over all employers, with the only possible exception for single-employee owner-operated businesses at locations where no customers or other outside individuals would have access to the facility. This law leaves intact only very narrow industry exceptions to the smoking ban, such as tobacco shops with private smoking lounges, cabs of large trucks where non-smoking employees are not present, theatrical production sites if smoking is an integral part of the story, or medical research or treatment sites, if smoking is integral to the research and treatment being conducted.

Other changes from these laws include raising the legal smoking age to 21 years or older, and including e-cigarettes and vaporizers within the same restrictions as those for traditional tobacco products.

Violations of this law are punishable by a fine not to exceed $100 for the first violation, $200 for a second violation within one year, and $500 for a third and each subsequent violation within one year.

Action required: Employers should review their policies to determine whether any updates are needed, especially regarding the expansion of smoking prohibitions to the popular e-cigarettes, and where smoking is allowed, to not allow employees under 21 to smoke.

SB 1063: Expansion of equal pay act to ethnicity and race

Current Law: The California Equal Pay Act went into effect January 1, 2016, which prohibits employers from implementing wage rates less than the rates paid to employees of the opposite sex in the same establishment for equal work on jobs the performance of which requires the same skill, effort, and responsibility, and which are performed under similar working conditions. Exceptions to this rule under existing law include, among others, where the payment is made based on any bona fide factor other than sex, such as education, training, or experience.

Changes from this law: This new law expands the Equal Pay Act standards to pay differentials between employees based on ethnicity or race. Specifically, this new addition to the Act states that an employer shall not pay any of its employees at wage rates less than the rates paid to employees of another race or ethnicity for substantially similar work, when viewed as a composite of skill, effort, and responsibility, and performed under similar working conditions, except where the employer demonstrates:

  1. The wage differential is based upon one or more of the following factors:
    1. A seniority system.
    2. A merit system.
    3. A system that measures earnings by quantity or quality of production.
    4. A bona fide factor other than race or ethnicity, such as education, training, or experience.

      This factor shall apply only if the employer demonstrates that the factor is not based on or derived from a race- or ethnicity-based differential in compensation, is job related with respect to the position in question, and is consistent with a business necessity. For purposes of this Act “business necessity” means an overriding legitimate business purpose such that the factor relied upon effectively fulfills the business purpose it is supposed to serve. This defense shall not apply if the employee demonstrates that an alternative business practice exists that would serve the same business purpose without producing the wage differential.
  2. Each factor relied upon is applied reasonably.
  3. The one or more factors relied upon account for the entire wage differential. Prior salary shall not, by itself, justify any disparity in compensation.

Employees claiming unequal pay under this law need only show a pay differential for ‘substantially similar’ work, meaning they do not need to have the same job title or exact same duties as the employee(s) to which their pay is being compared. Further, comparisons are no longer limited to the ‘same establishment,’ so employers with multiple locations should analyze wage differentials across the different locations.

Action required: Employers should now expand their analysis on employee pay differentials to employees of different races and ethnicities. This analysis can be complex and difficult to navigate so employers should involve employment counsel in the process.

AB 1676: Wage discrimination—use of salary history

New law: The Equal Pay Act was enacted in 2016, as described above. This bill expands the Equal Pay Act to provide that, for purposes of the factors that can be used to justify a wage differential, prior salary shall not, by itself, justify any disparity in compensation.

Action required: In determining compensation rates, employers cannot rely on an employee’s prior compensation as the basis for a disparity in compensation based on gender, race or ethnicity. In order to avoid the allegation that the employer used prior compensation in such a manner, employers may want to remove any request for information regarding prior compensation in their employment applications.

AB 1732: Single-user restrooms (effective 3/1/17)

Current Law: Under current law, publicly and privately owned facilities where the public congregates, are to maintain a sufficient number of temporary or permanent toilet facilities to meet the needs of the public. Existing law also requires each business establishment to provide, within reasonable access, a sufficient number of toilet facilities for the use of the employees.

Changes from this law: Effective March 1, 2017, all single-user toilet facilities in any business establishment or place of public accommodation shall be identified as all-gender toilet facilities by compliant signage, and designated for use by no more than one occupant at a time or for family or assisted use. “Single-user toilet facility” is defined as a toilet facility with no more than one water closet and one urinal with a locking mechanism controlled by the user.

Inspection for compliance with this law can be conducted by an inspector, building official, or other local official responsible for code enforcement.

Action required: Employers should evaluate all of its restroom facilities for any single-user facilities as defined by the law, and to obtain signage that is compliant with Title 24 of the California Code of Regulations.

AB 1843: Criminal history in employment applications

Current Law, employers are prohibited from requesting a job applicant to disclose (or using as a factor for employment) information concerning an arrest or detention that did not result in a conviction, or information concerning a referral or participation in, any pretrial or post-trial diversion program, except as specified. Existing law also prohibits covered employers from requesting disclosure from job applicants (or using as a factor for employment), information concerning a conviction that has been judicially dismissed or ordered sealed, except in specified circumstances.

Changes from this law: AB 1843 now also prohibits an employer from asking or using any information related to juvenile arrests, detentions, diversions, or court dispositions in hiring decisions. Also, under this law, employers cannot inquire about or consider juvenile convictions (or other court orders) in determining any condition of employment (including hiring). A narrowly-defined exception to this law exists for health facilities.

Action required: Ensure that your employment applications do not request information falling within these categories.

AB 326: Occupational Safety And Health—reporting requirements

Current Law: All employers are required to file a report of every occupational injury or occupational illness with the Division of Occupational Safety and Health or, if an insured employer, to file a report with the insurer, on a form prescribed for that purpose by the Department of Industrial Relations. A report shall be filed concerning each injury and illness which has, or is alleged to have, arisen out of and in the course of employment, within five days after the employer obtains knowledge of the injury or illness. In the case of an insured employer, the insurer shall file with the division immediately upon receipt, a copy of the employer’s report, which has been received from the insured employer. In addition, existing law requires employers to make an immediate report by telephone or telegraph to the Division of every case involving an employee’s serious injury or illness or death.

Changes from this law: This new bill just updates the antiquated method of reporting a serious injury/illness or death by providing that in every case involving a serious injury/illness, or death, the additional report is to be submitted immediately by the employer to the Division of Occupational Safety and Health by telephone or email.

AB 2261: DLSE enforcement authority

Current Law: Any person who believes that he or she has been discharged or otherwise discriminated against in violation of any law under the jurisdiction of the Labor Commissioner may file a complaint with the Division of Labor Standards Enforcement, and requires the Labor Commissioner to establish procedures for the investigation of discrimination complaints.

Changes from this law: The new law authorizes the Division to, with or without receiving a complaint from an employee, commence an investigation of an employer that it suspects to have discharged or otherwise discriminated against an individual in violation of any law under the jurisdiction of the Labor Commissioner. It is questionable how, without an employee complaint, the Division would encounter facts that could cause it to suspect that the employer discharged or discriminated against an individual in violation of a law within its jurisdiction. It is possible that the Division could obtain such information in the course of an investigation or audit of another issue, or possibly in the course of handling a complaint on another issue. It is yet to be seen whether and to what extent the Division will actively seek such information on its own. Employers should remain aware of the DLSE’s new expanded enforcement authority and continue to carefully analyze termination and other personnel decisions that could be in violation of wage laws or in retaliation for complaints about wage law compliance issues.

AB 2337: Notice of rights for victims of domestic violence, sexual assault or stalking

Current Law: Employers are prohibited from discharging, discriminating or retaliating against an employee who is a victim of domestic violence, sexual assault, or stalking for taking time off from work for specified purposes related to addressing the domestic violence, sexual assault, or stalking. Existing law also provides remedies to such an employee of reinstatement, reimbursement for lost wages and work benefits caused by the acts of the employer, as well as equitable relief, and the right to file a complaint with the Division of Labor Standards Enforcement.

Changes from this law: This bill now requires employers to inform each employee of his or her rights established under this law by providing specific information in writing to new employees upon hire and to other employees upon request. The bill also requires the Labor Commissioner, on or before July 1, 2017, to develop a form an employer may use to comply with these provisions and to post it on the Labor Commissioner’s website. This form shall set forth the rights and duties of employers and employees under this section in clear and concise language. If an employer elects not to use the form developed by the Labor Commissioner, the notice provided by the employer to the employees shall be substantially similar in content and clarity to the form developed by the Labor Commissioner. Employers will not be required to comply with the notice of rights requirement until the Labor Commissioner posts the form.

Action required: Employers should watch for the Labor Commissioner model notice coming out in 2017 and be prepared to post that notice, or to create its own with substantially similar content and clarity as the model notice.

AB 2535: Wage statements and hours for exempt employees

Current Law: Employers must provide employees with an accurate itemized written wage statement containing specified information, either semimonthly or at the time the employer pays the employee his or her wages.

Changes from this law: This new law specifies that the itemized wage statement need not show total hours worked by the employee if the employee is: 1) exempt under an executive, administrative, or professional capacity provided in any applicable order of the Industrial Welfare Commission; 2) exempt as an outside salesperson provided in any applicable order of the Industrial Welfare Commission; 3) exempt as an computer software professional paid on a salaried basis provided in Labor Code Section 515.5; 4) exempt as a parent, spouse, child, or legally adopted child of the employer provided for in any applicable order of the Industrial Welfare Commission; 5) exempt as a participant, director, or staff of a live-in alternative to incarceration rehabilitation program with special focus on substance abusers provided in Section 8002 of the Penal Code; 6) exempt as a crew member employed on a commercial passenger fishing boat licensed pursuant to Article 5 of the Fish and Game Code provided in any applicable order of the Industrial Welfare Commission; or 7) exempt as an individual participating in a national service program provided in any applicable order of the Industrial Welfare Commission.

AB 2899: Challenging minimum wage citations

Current Law: Any employer or responsible person who violates the state or local minimum wage, is subject to a civil penalty, restitution of wages, liquidated damages payable to the employee, and any applicable specified penalties. There are procedures under which a person against whom a citation has been issued can request a hearing to contest any penalties, wages or other damages imposed, and after a hearing with the Labor Commissioner, a person contesting a citation may file a writ of mandate, within 45 days with the Superior Court.

Changes from this law: This new law requires a person seeking a writ of mandate contesting the Labor Commissioner’s ruling to post a bond with the Labor Commissioner in an amount equal to the unpaid wages assessed under the citation, excluding penalties. The bond must be issued in favor of the unpaid employee and ensure that the person seeking the writ makes prescribed payments pursuant to the proceedings. Moreover, the proceeds of the bond must be sufficient to cover the amount owed and are forfeited to the employee if the employer fails to pay the amounts owed within 10 days from the conclusion of the proceedings.

SB 1241: Employment contracts—choice of law and forum

New law: This new law prohibits an employer from requiring an employee who primarily resides and works in California, to agree as a condition of employment, that: 1) the employee must adjudicate (either through litigation or arbitration) outside of California a claim arising in California, or 2) that a dispute arising in California must be governed by substantive law other than California law. Any provision of a contract that violates this law is voidable by the employee, and if a provision is rendered void at the request of the employee, the matter shall be adjudicated in California and California law shall govern the dispute. In addition to injunctive relief and any other remedies available, a court may award an employee who is enforcing his or her rights under this section reasonable attorney’s fees. However, these provisions do not apply to a contract with an employee who is individually represented by legal counsel in negotiating the terms of an agreement regarding choice of law or forum. This law applies any contracts entered into, modified, or extended on or after January 1, 2017.

Action required: Employers should review their agreements with employees to ascertain whether such agreements contain choice of law or forum selection clauses, and to consult with counsel regarding the extent to which the employer should modify the agreement and/or the employer’s practices regarding the agreement. This evaluation is especially important for out-of-state entities employing workers in California.

SB 1001: Unfair employment practices- immigration

Current Law: Existing law prohibits unfair immigration-related practices against a person for the purpose of or intent to retaliate against any person for exercising a protected right. Existing law also prohibits employers from requesting more or different documents than are required under federal law for authorizing eligibility to work in the U.S., or refusing to honor documents tendered that on their face reasonably appear to be genuine.

Changes from this law: This new law provides that it is unlawful for an employer, in the course of verifying USCIS Form I-9 documents, to do any of the following: 1) request more or different documents than are required by U.S. law for purposes of fulfilling I-9 Form requirements; 2) refuse to honor documents tendered that on their face reasonably appear to be genuine; 3) refuse to honor documents or work authorization based upon the specific status or term of status that accompanies the authorization to work; 4) attempt to reinvestigate or re-verify an incumbent employee’s authorization to work using an unfair immigration-related practice.

Violation of this section can result in a penalty imposed by the Labor Commissioner and liability for equitable relief, and an applicant for employment or an employee (or employee representative) who is subject to an unlawful act that is prohibited by this law, may file a complaint with the DLSE.

State minimum wage increase

The California minimum wage increases to $10.50 effective January 1, 2017.

Action required: Make any wage adjustments to meet at least this new minimum, and remember that the increase in minimum wage also raises the threshold of minimum earnings for the commission sales exemption (1.5 times minimum wage) and employees who are required to bring their own tools (2 times minimum wage). Employers should also update their minimum wage postings and check for any changes in local minimum wages ordinances that may apply.


Read about More new laws for 2017.