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2023 New Laws & Updates

Provided by BBSI

2023 New Laws & Updates

As the calendar flips to 2023, it's a good time to make sure you're up to date with the new laws, regulations, court cases and agency actions — many of which will affect California employers’ day-to-day operations and policies. These updates are organized by topic below to help you understand your responsibilities and learn how they will impact your business.

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Recruiting and Hiring
• Effective January 1, 2023, employers with 15 or more employees must include the pay scale information for a position in any job posting, and they have new requirements regarding the disclosure of pay scale information to both applicants and current employees.

• A Ninth Circuit panel will rehear arguments, in light of the U.S. Supreme Court's Viking River Cruises ruling, to determine whether a law passed in 2019 violates the Federal Arbitration Act (FAA), which was amended to prohibit mandatory arbitration of claims involving allegations of sexual harassment or sexual assault.

Exempt and Nonexempt
• The minimum salary requirement for the executive, administrative and professional exemptions increased for 2023.

• The minimum wage rates for the licensed physicians or surgeons exemption increased for 2023.

• The minimum wage rates for the computer professional exemption increased for 2023.

• The minimum earnings requirement for the inside salesperson exemption changed due to the higher 2023 state minimum wage.

Personnel Records and Privacy
• Effective January 1, 2023, personal information about employees and applicants are subject to all requirements under the California Privacy Rights Act.

Drugs, Alcohol and Smoking in the Workplace
• Beginning January 1, 2024, California’s Fair Employment and Housing Act will prohibit employers from discriminating against an employee or job applicant based on the person's use of cannabis off the job and away from the workplace, which will impact pre-employment testing practices.

Wage and Hour Law
• The U.S. Supreme Court ruled that individual claims under the Private Attorneys General Act (PAGA) can be compelled to arbitration if the employee signed a valid arbitration agreement to that effect.

Wages, Salaries and Other Compensation
• California’s minimum wage is now $15.50 per hour for all employers, regardless of size.

• A program in which disabled individuals could obtain a one-year license to work at a wage less than minimum wage is being phased out.

• The Social Security wage base limit increased for 2023. See Standard Deductions: Taxes.

• The meal and lodging credits employers may take against minimum wage increased when the new minimum wage became effective on January 1, 2023.

• The 2023 IRS mileage rates have increased for 2023.

• A recent court decision articulates two additional steps employers should take to avoid liability for failure to provide adequate seating.

• The minimum wage rate on certain federal contracts increased, and a new law sets in motion new standards for the fast-food industry.

Hours of Work and Recording Time Worked
• In a 2022 decision, a California Court of Appeal ruled against an employer in claim for unpaid wages based on the employer's rounding policy, calling into question the permissibility of rounding practices allowed under previous court decisions.

State Disability Insurance and Paid Family Leave
• The California Employment Training Panel and the California Labor and Workforce Development Agency are providing grants of up to $2,000 per employee utilizing California’s PFL program. See Paid Family Leave Defined.

Health and Retirement Benefits
• Minimum annual deductibles for Health Savings Accounts (HSA) for those who have high-deductible health plans (HDHP) are set for 2023.
• For 2023, if you have self-only HDHP coverage, you can contribute up to $3,850. If you have family HDHP coverage, you can contribute up to $7,750.
• CalSavers coverage was expanded to include employers with one or more employees, excluding sole proprietorships, self-employed individuals, or other business entities that do not employ any individuals other than the owners of the business.

Family, Medical and Parental Leave
• Beginning January 1, 2023, employees can take California Family Rights Act (CFRA) leave to care for a “designated person” with a serious health condition. See CFRA and FMLA Qualifying Reasons.

Paid Sick Leave
• Beginning January 1, 2023, employees can take PSL to care for a “designated person,” someone identified by the employee at the time the employee requests paid sick days.

Miscellaneous Time Off
• California now requires private employers with five or more employees, and all public employers, to provide up to five days of bereavement leave upon the death of a family member.

Ensuring Workplace Safety
• Beginning January 1, 2023, California’s COVID-19 notification requirements were significantly revised. See Injury and Illness Prevention Program (IIPP).

• California law prohibits an employer, in the event of an “emergency condition,” from taking or threatening adverse action against an employee.

• Health care employers must maintain an inventory of new, unexpired PPE for use in the event of a declared state of emergency.

• The California Division of Occupational Safety and Health (Cal/OSHA) must disseminate to agricultural employers and employees information on best practices for preventing COVID-19 infections, both in English and Spanish.

• Beginning January 1, 2023, upon receiving a citation or order, employers must post an additional employee notice, to be prepared by Cal/OSHA, that includes information regarding health and safety violations.

Workers’ Compensation
• Newspaper distributors working under contract with a newspaper publisher, and newspaper carriers working under contract with either a newspaper publisher or newspaper distributor are temporarily exempted from independent contractor status in the workers’ compensation context. This exemption also applies to manicurists and subcontractors in the construction trucking industry.

• Several additional COVID-19 bills were introduced, including the COVID-19 Disability Retirement Presumption that creates a rebuttable presumption that firefighters, public safety and medical workers who become disabled or die from COVID-19 have access to public retirement pension, disability, and death benefits.

• It is the burden of the employee to provide “objective evidence” of the events of employment that give rise to a claim for psychiatric injury.

• AB 2693 amends Labor Code sections 6325 and 6409.6 to extend and modify employer COVID-19 notice requirements to January 1, 2024, requires employers to continue reporting outbreaks and potential exposures to employees, and extends Cal/OSHA's authority to disable an operation or process at a worksite if the COVID-19 risk is an imminent hazard.

• Effective January 1, 2023, Labor Code section 4600 includes Licensed Clinical Social Workers in the list of professionals that can provide medical services to injured employees.

• The maximum weekly temporary disability payment for 2023 is $1,616.15, while the minimum is $242.86.

• A bill passed in 2022 makes permanent provisions of the Public Employees’ Retirement Law that provide to safety members of CalPERS who retire from industrial disability a retirement benefit paid through a CalPERS trust fund.

• A bill passed in 2022 will, effective January 1, 2024, make it unlawful for employers to discriminate in hiring, firing, or setting conditions of employment based on cannabis use off the job and away from the workplace.

Employment Discrimination
• Effective January 1, 2023, employees in California are protected from employment discrimination based on their actual or perceived “reproductive health decision making.”

• Beginning January 1, 2024, the FEHA will prohibit employers from discriminating against an employee or job applicant based on the person's use of cannabis off the job and away from the workplace.

• Effective January 1, 2023, California revised and expanded its pay data reporting requirements and changed the annual report due date.

• The California Supreme Court recently clarified that proving retaliation under California’s whistleblower statute, Labor Code section 1102.5, is different than proving retaliation under the Fair Employment and Housing Act (FEHA).

• The Ninth Circuit Court of Appeals dismissed a manicurist’s gender discrimination suit but remanded his claim of hostile environment harassment to a lower court to be heard by a jury.

Layoffs and Plant Closings
• California created what is commonly referred to as a “right of recall” for certain employees that were laid-off due to COVID-19.

• Effective January 1, 2023, California law created specific requirements for the relocation of call centers to foreign countries.