Archives for April 2020

New California Law Requires At Least One Woman on Boards of Publicly-Traded Companies

California passed a pioneering law mandating that each publicly held company headquartered in the state have at least one female on its board of directors (Senate Bill No. 826; Corporations Code §301.3). The purpose of the law is to address the lack of representation of women on boards of directors, as at the time it was signed, one-fourth of California’s public companies had no female directors. San Diego was the worst county in the state for board diversity – 44 percent of companies headquartered in San Diego had no women on their boards – the highest percentage of any county in the state, according to a 2018 report by USD Business Professor, Annalisa Barrett.

The law applies to both domestic corporations (those incorporated within California) and foreign corporations (incorporated in Delaware, or any state or country other than California) with principal executive offices in California. The law states that by the end of 2021, a corporation with four or fewer directors must have a minimum of one female director; a corporation with five directors must have a minimum of two female directors; and a corporation with six or more directors must have a minimum of three female directors.

The state may also fine companies not in compliance – $100,000 for their first violation and $300,000 for any subsequent violation, with each seat that is not filled counting as its own violation.

According to a report released by KMPG at the end of February 2020, 96 percent of California’s companies have complied with the new law – only 4 percent still had all-male boards by the year-end deadline, down from 29 percent when the law took effect.

Senate President Pro Tempore, Toni Atkins, a co-author of the bill, has said the results are validating, and that having more women in the boardroom makes sense, both for profitability and equality. California is setting a precedent for the entire country to follow, and indeed, other states are following suit, with similar measures being introduced in Washington state, Massachusetts, New Jersey, and Illinois. Investment bank Goldman Sachs has said it won’t take a company through an IPO unless it has at least one female board member.

A challenge to the constitutionality of the law was just dismissed this week by a California federal judge. A shareholder of OSI Systems, Inc. sued the Secretary of State, claiming that the law violated the 14th Amendment’s Equal Protection Clause. Judge Mendez in the U.S. District Court for the Eastern District of California dismissed his case, holding the plaintiff had no standing because the statute applies only to corporations, and he is a shareholder, ā€œa distinction with a difference.ā€ See Meland v. Padilla, 2:19-cv-02288 (E.D. CA, April 20, 2020).

At least a dozen other countries have addressed the issue of lack of gender diversity on corporate boards by mandating that 30-40 percent of board seats be held by women directors. Germany requires that 30 percent of public company board seats be held by women. In 2003, Norway was the first country to mandate 40 percent of board seats be held by women. Similar mandates have been legislated by France, Spain, Iceland, and the Netherlands.

If you have questions about complying with this new law or believe you need to take legal action to assert your rights,Ā contact Haeggquist & Eck, LLP online or callĀ (619) 342-8000Ā and ask how you can arrange a complimentary consultation with one of our attorneys.

More Time For Adult Survivors of Child Sexual Assault To Sue

California has passed a new law extending the statute of limitations for cases of alleged childhood sexual abuse. This is incredibly important both for survivors of child sexual assault and for the protection of California’s children. Authored by Assemblywoman Lorena Gonzalez of San Diego and signed by Governor Gavin Newsom, as of Jan. 1, 2020, adults have until at least their 40th birthday to file claims against people and institutions they seek to hold responsible for sexual molestation or sexual assault they experienced as children. See Code of Civil Procedure §340.1. Before this new law, survivors had until their 26th birthday to file suit.

The law also opens up a three-year window for the revival of any claims that would have been barred by the statute of limitations. In addition, the law provides for added penalties (treble damages) against employers or organizations that covered up childhood sexual abuse. As has been well documented with the Catholic Church and Boy Scouts of America, institutions have been criticized for moving predators around from one place to another to avoid accountability.

Data suggests that survivors of childhood sexual abuse often do not tell anyone about the abuse until they are well into their adulthood. Survivors can help protect today’s children by ensuring that what happened to them doesn’t happen to another child.

If the sexual assault happened after the victim’s 18th birthday, the time to file a lawsuit for sexual assault was extended last year to up to ten years after the assault or three years after the injury was discovered, whichever is later. See Code of Civil Procedure §340.16.

Haeggquist & Eck, LLP represents brave survivors of sexual assault and sexual harassment. Contact usĀ onlineĀ or call us atĀ (619) 342-8000Ā to speak with one of our attorneys.

2020 California Employment Law Update

The State of California implemented several employment laws that took effect on January 1, 2020. Here are some that may impact you.

Another Step Forward For AĀ Living Wage

This year, the California minimum wage jumped to $12 per hour for companies with 25 employees or fewer, and $13 per hour for companies with more than 25 employees. The City of San Diego’s minimum wage is now $13 per hour for all employees, regardless of the employer’s size. Note that some cities in California have minimum wages that are even higher, for example, South San Francisco at $15 per hour.

Misclassification of Employees as Independent Contractors (Assembly Bill No. 5; Labor Code §§3351 & 2750.3)

This law sets forth the test to be used for determining whether a worker is an employee or an independent contractor, the so-called ABC test, set out in Dynamex. Under this test, a worker is considered an employee rather than an independent contractor unless the hiring party demonstrates that all three of the following conditions are satisfied:

A. The worker is free from the control and direction of the hiring party;

B. The worker performs work that is outside the usual course of the hiring entity’s business; and

C. The worker is customarily engaged in an independently established business of the same nature as the work performed.

The law has seven categories of exemptions. A worker who falls within one of the exemptions is not automatically considered an independent contractor; instead, the hiring party must demonstrate that it did not control the ā€œmanner and meansā€ of accomplishing the desired result.

Extension of Time To File a DFEH Complaint (Assembly Bill No. 9; Government Code §§12960 & 12965)

The time period to file a Complaint with the Department of Fair Employment and Housing (ā€œDFEHā€) for complaints of unlawful employment practices has been extended from one year to three years.

No Forced Arbitration as a Condition of Employment (Assembly Bill No. 51; Government Code §12953; Labor Code §432.6)

Employers may not force employees to agree to arbitration as a condition of employment or continued employment. Employers also cannot threaten, retaliate or discriminate against, or terminate any employee or applicant for employment for refusing to agree to arbitration. Note that this law does not invalidate arbitrations the employee has previously agreed to.

Prohibition of ā€œNo-Hireā€ Provisions (Assembly Bill No. 749; Code of Civil Procedure §1002.5)

Employers are prohibited from including a ā€œno rehireā€ provision in settlement agreements with employees. The law, however, does not prohibit an agreement to end a current employment relationship.

Unpaid Leave For Organ Donation (Assembly Bill No. 1223; Government Code §19991.11; Labor Code §1510)

Employers are required to grant an employee up to 30 days of additional unpaid leave of absence for donating an organ and prohibits life, long-term care, or disability insurance policies from discriminating against an organ donor.

Discrimination in Calculating Monetary Damages Prohibited (Senate Bill No. 41; Civil Code §3361)

Calculations or estimations of past, present, or future damages for lost earnings or impaired earning capacity shall not be reduced based on race, ethnicity, or gender.

Lactation Accommodations (Senate Bill No. 142; Labor Code §§1030 – 1034)

Employers must provide a lactation room or location with certain features, and access to a sink and refrigerator in close proximity to the employee’s workspace. If the employer denies reasonable break time or adequate space to express milk, this is deemed a failure to provide a rest period in accordance with California law. Employers are prohibited from discriminating or retaliating against or terminating an employee for exercising or attempting to exercise their lactation rights.

No Discrimination Based on Natural Hairstyles (Senate Bill No. 188; Government Code §12926)

This law protects employees from discrimination based on natural hair and hairstyles associated with race. California is the first state to ban discrimination based on natural hair. California’s Fair Employment and Housing Act (ā€œFEHAā€) protects against discrimination based on certain personal characteristics, including race. This law expands the definition of ā€œraceā€ to include ā€œtraits historically associated with race, including, but not limited to, hair texture and protective hairstyles,ā€ including ā€œbraids, locks, and twists.ā€

Sanctions For Employer’s Non-Payment of Arbitration Fees (Senate Bill No. 707; Code of Civil Procedure §§1280 and 1281.96 – 1281.99)

If an employer strategically withholds payment of arbitration fees in order to delay or impede arbitration proceedings, this law allows arbitrators and courts to impose appropriate sanctions on the employer, including terminating sanctions. The law also addresses the lack of diversity in the arbitration industry by requiring arbitration companies to report the same kind of demographic information about their arbitrators as the Judicial Council is required to report about California state court judges.

Contact Us If You Believe Your Employer Violated the Law

The attorneys at Haeggquist & Eck, LLP are experienced and dedicated professionals who are committed to protecting your rights in the workplace.Ā If you feel that your rights may have been violated, contact our attorneysĀ onlineĀ or atĀ (619) 342-8000Ā to learn more.

I’m An Independent Contractor. What Rights Do I Have? Am I Entitled To Unemployment or Other Benefits?

As of today, cities and states are reaching the peak of their curves, and Americans can finally see a semblance of light at the end of the COVID-19 tunnel. But for many Americans, the end of that tunnel will mean the beginning of economic hardship. Although federal and state laws provide public benefits for ā€œtraditionalā€ employees, many of these benefits are ordinarily non-existent or severely lacking for independent contractors and self-employed workers. Fortunately, the federal and state governments have taken significant measures to protect millions of Americans who would otherwise be left high and dry.

Unemployment Insurance Benefits

Self-employed, part-time, and gig workers comprise as much as one quarter of allĀ workers in California. Thankfully, following the passage of the CARES Act last month, independent contractors and the self-employed who are affected by COVID-19 can now apply for unemployment benefits.Ā To be eligible for benefits under the CARES Act, a non-traditional worker must meet one of the followingĀ criteria:

  • You have been diagnosed with COVID-19 or experience COVID-19 symptoms and you’re seeking a medical diagnosis;
  • You are unable to work because your doctor advised you to self-quarantine because of COVID-19;
  • A member of your household is diagnosed with COVID-19;
  • You are a caregiver for a family member or a member of your household who has been diagnosed with COVID-19;
  • A child or other person in the household for whom you have primary caregiving responsibility cannot go to school or daycare because of COVID-19 and the school or daycare is required for you to work;
  • You are now the sole breadwinner of the household because the head of the household died as a result of COVID-19;
  • You quit because of COVID-19;
  • Your job closed because of COVID-19;
  • You were supposed to start working at a job that closed because of COVID-19;
  • You cannot get ahold of your employer because of COVID-19; or
  • If you work as an independent contractor with reportable income, and you are unemployed, partially employed, or unable or unavailable to work because COVID-19 severely limited your ability to continue performing your customary work activities and has thereby forced you to stop working.

As discussed in our previousĀ blogĀ entry, the CARES Act:

  • Gives eligible workers 13 additional weeks of unemployment benefits. Because California ordinarily provides 26 weeks of unemployment benefits, Californians may now receive up to 39 weeks of benefits; and
  • Provides unemployed workers an additional $600, on top of what they receive in unemployment compensation per week, through July 31, 2020.

The California Employment Development Department (ā€œEDDā€) is still developing a new program for self-employed workers and independent contractors. As such, the EDD is asking self-employed workers and independent contractors wait to apply until after the EDD establishes a separate program for these ordinarily ineligibleĀ workers. Nevertheless, the EDD recognizes all eligible workers have a right to file for unemployment benefits even though the State is still working out the kinks.

Information on how to file an unemployment claim can be found here:Ā https://www.edd.ca.gov/unemployment/UI_Online_File_a_Claim.htm

Paid Sick Leave

Under the Families First Coronavirus Response Act (ā€œFFCRAā€), self-employed workers are entitled to paid sick leave in the form of a tax credit allowed against the worker’s self-employmentĀ tax. Importantly, ā€œeligible self-employed individualsā€ under the FFCRA include individuals who ā€œwould be entitled to receive paid leave during the taxable year pursuant to the Emergency Paid Sick Leave Act if the individual were an employee of an employer.ā€

In other words, this provision could also apply to some independent contractors who would have otherwise been entitled to sick leave. The credit allows workers to take up to 10 paid sick days, and sick leave wages are capped at $511 per day for their own use and up to $200 a day to care for others and any other substantially similar condition.

Further information about the FFCRA can be found in our previousĀ blogĀ entry.

If you think you need legal assistance from an employment law attorney to fight for your rights and fair compensation, reach out to the attorneys of Haeggquist & Eck, LLP for help!

We can be contactedĀ onlineĀ or by phone atĀ (619) 342-8000.

Haeggquist & Eck, LLP Featured in San Diego Super Lawyers Magazine

Employee and consumer rights advocates Alreen Haeggquist and Amber Eck were featured in a cover story of a recent San Diego issue ofĀ Super Lawyers Magazine, delving into each attorney’s backstory and how the firm took on – and beat – Trump University and other major defendants.

The extensive piece covers Haeggquist’s roots in Pakistan and Eck’s in Montana, and how both attorneys’ lives would develop to eventually intertwine to form Haeggquist & Eck, LLP – San Diego’s most notable employee and consumer rights law firm, and arguablyĀ among the most notable in the country.

That’s because the firm has racked up an impressive string of high-profile cases against major players including the Salk Institute, Fairmont Grand, and President Donald Trump and Trump University, which is explored in detail throughout the Super Lawyers Magazine Piece.

For more information about Haeggquist & Eck, LLP’s victories in consumer rights and employment law cases, check out theirĀ cover article in Super Lawyers MagazineĀ or reach out to the firmĀ online!

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