California Update

2015 Legislative Session in Sacramento Comes to a Close

Oct 23, 2015
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October 11 marked the deadline for Governor Jerry Brown (D) to sign into law or veto legislation that the California Legislature sent to his desk for consideration. One significant piece of legislation that the governor vetoed was S.B. 406, a bill opposed by SHRM and CalSHRM that would have expanded California’s unpaid family leave policy by adding more family members of employees that would be covered by the leave law.

In his veto message, Governor Brown echoed SHRM’s and CalSHRM’s concerns that the expansion of the law would have created too much of a disparity between California’s family leave laws and the federal Family and Medical Leave Act. SHRM’s lobbying efforts in Sacramento played an integral role in guaranteeing that this bill did not become law.

The governor did sign a separate significant HR bill, S.B. 358, which amends California’s Equal Pay Act to target gender-based wage gaps. Backed by both labor and employer groups, S.B. 358 made it through the legislative process on a bipartisan vote. Some of the key requirements in the bill:

  • Current law prohibits employers from paying less to members of the opposite sex who perform equal work in the same establishment. S.B. 358 eliminates the “same establishment” requirement and revises the “equal work” requirement to instead prohibit paying less for “substantially similar work, when viewed as a composite of skill, effort and responsibility” performed under similar working conditions.
  • The bill amends the exceptions, which presently are a seniority system, a merit system, a system that measures earnings by quantity or quality of production, or a differential based on any bona fide factor other than sex. Specifically, while it retains the first three exceptions, it significantly revises the “bona fide factor other than sex” exception to require the employer prove a wage differential is not based on or derived from a sex-based differential and is consistent with a “business necessity,” such as a difference in education, training or experience that is job-related with the position in question. It would also specify that “business necessity” means “an overriding legitimate business purpose such that the factor relied upon effectively fulfills the business purposes it is supposed to serve.”
  • In addition to demonstrating at least one of the factors above, employers must also satisfy two new criteria: (a) that each factor relied upon is applied reasonably; and (b) that the one or more factors relied upon account for the entire wage difference.
  • The bill expands from two years to three years an employer’s obligation to retain records of the wages and wage rates, job classifications, and other terms and conditions of employment for employees.
  • The bill prohibits employers from discharging, or in any way discriminating or retaliating against, any employee who takes action to invoke or assist in any manner the enforcement of California’s Equal Pay Act. Under this new subsection, employers would also not be able to prohibit an employee from discussing the employee’s own wages, discussing the wages of others, inquiring about another employee’s wages, or aiding or encouraging any other employee to exercise his or her rights under this section.

Governor Brown also signed a number of other bills that CalSHRM and SHRM have monitored throughout the legislative process. These include:

  • A.B. 622, which prohibits an employer from using the E-Verify system to check the employment authorization status of either an existing employee or an applicant who has not received an offer of employment, except as required by federal law or as a condition of receiving federal funds.
  • A.B. 1506, which amends the Private Attorneys General Act of 2004 (PAGA) to allow employers an opportunity to cure two wage statement violations (as to employer name and pay period dates) before being subjected to potentially costly civil actions. The bill went into effect on October 2, 2015, since an urgency clause was added to the bill. CalSHRM supported this bill.
  • S.B. 579, which allows employees to take time off for “child care or school emergencies.”
  • S.B. 588, which enables the Labor Commissioner, on behalf of an aggrieved employee, to file a levy against any credits, money or other property of an employer to collect on a judgment for unpaid wages.

The governor vetoed the following bills:

  • A.B. 1017, which would have prohibited an employer from seeking salary history information from an applicant for employment.
  • A.B. 465, which precluded employers from requiring that employees agree to arbitration as a condition of employment.
  • A.B. 676, which prohibited advertisements discouraging the unemployed from applying.
  • A.B. 1354, which required employers with more than 100 employees in the state and a contract of 30 days or more, prior to becoming a contractor or subcontractor with the state, to submit a nondiscrimination program to the California Department of Fair Employment and Housing, and to submit periodic reports (but not more than annually) of its compliance with that program.
  • A.B. 883, which prohibited state or local agencies from publishing or posting a job advertisement or announcement indicating an individual’s status as a current or former public employee, disqualifying him or her from employment.

Because this was the first year of a two-year session, bills that did not make it to the governor’s desk this summer are still viable when the legislature returns in January. One significant piece of legislation that will be active in the legislature next year is A.B. 1383, which would allow a private-sector employer in the state to establish a voluntary preference in the hiring of veterans without the fear of a discrimination claim.

While this SHRM- and CalSHRM-sponsored bill received unanimous support (77 to 0) in the California Assembly, the bill did not meet the Senate Judiciary Committee’s deadline for consideration this summer. During consideration in committee, chairwoman Senator Hannah-Beth Jackson (D-Santa Barbara) expressed concerns that some “unscrupulous” employers may use the preference to discriminate against protected classes in California, and efforts to reach consensus language in modifying the bill to address these concerns are still ongoing.

SHRM and CalSHRM are continuing to work closely with Senator Jackson and her staff to craft language that would address her concerns, while protecting employers from unwarranted litigation. Throughout the legislative process, SHRM and CalSHRM have worked closely on the advocacy efforts on A.B. 1383. SHRM’s lobbyist in Sacramento, Jason Gabhart, met directly with legislators and/or their staff to advocate for the bill’s passage, and the California A-Team was used to build support for the bill leading up to the Assembly consideration of the measure. CalSHRM leaders also testified in both the Assembly Committee on Labor and Employment and the Senate Judiciary Committee.

For questions on any piece of California legislation, please contact SHRM’s California State Government Relations Advisor Jason Gabhart at or (916) 403-3465.

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