07.22.21

Devastating News for Employers on Meal and Rest Period Premiums

HR NEWS

The California Supreme Court determined that employers must use the employee’s regular rate of pay in calculating the premium paid to employees who were not provided a meal, rest or recovery period.  (Ferra v. Loews Hollywood Hotel, LLC, Cal.LEXIS 4877 (July 15, 2021).)  The issue came before the Court because the Legislature enacted ambiguous legislation that called for employers to pay the meal or rest period premium at the employee’s regular rate of compensation.  Prior courts determined that the regular rate of compensation meant the employee’s hourly wage.  The Supreme Court rejected this position.

This decision requiring an employer to pay the regular rate of pay for a missed meal or rest period premium will have a devastating effect on California businesses in at least three ways.

The Regular Rate of Pay is Often More than the Hourly Rate of Pay.  The only time the regular rate of pay and the regular rate of compensation are the same is when the employee does not receive any compensation other than an hourly rate of pay.

However, if an employee earns compensation in addition to an hourly wage, the regular rate of pay will always be more than the hourly wage.  This is because in calculating the regular rate of pay, an employer must include all forms of compensation.

The precise method of calculating the regular rate of pay will differ depending on the type of extra compensation earned.  Consider the employee who worked 40 hours and earns $15 plus a production bonus of $100.  The regular rate of pay is calculated at dividing total compensation by total hours.  Here, the calculation is ($15 x 40 hrs) + $100 = $700

40 = $17.50.  The premium which must be paid for a missed meal or rest period is $17.50.

The Premium Could Vary From Week to Week.  Consider the example above.  In the first week the employee earns a $100 commission.  In the subsequent week, the employee earns a $200 commission.  The regular rate of pay in the second week is $20.  This means employers will need to make constant reviews of compensation earned in each workweek to pay the employee correctly.

In addition, will the employer be required to make adjustments to prior pay periods if a bonus is not paid until the last pay period in a quarter or in the year?

The Court’s Decision is Retroactive.  The Court determined that its ruling, requiring employers to pay the regular rate of pay as the premium for missed meal and rest periods, is retroactive.  This means employees can make claims for unpaid meal and rest periods for the past four years.  Consider the employer who paid its employees a meal or rest period premium calculated at the hourly wage.  Will the employer now be required to go back and increase the amount of the premium paid based on the regular rate of pay during that workweek or pay period?

Moreover, consider the employer who does not go back and make additional payments.  Or consider the employer who paid a meal or rest period premium based on the hourly wage and the employee has since left the workplace.  Since a meal or rest period premium is considered to be a wage, that means the employer did not pay all wages due at the time of termination.  That employer could be held liable for 30 days of waiting time penalties calculated at the employee’s daily wage.

Recommendations

Employers should consider whether or not to provide employees with non-discretionary bonuses such as safety or production bonuses, on-call payments, benefits for meals or gym memberships, and any other similar payments.  This extra compensation creates a regular rate of pay that is higher than the hourly rate of pay.

Discretionary pay, which is determined in the sole discretion of the employer, is not part of the calculation for the regular rate of compensation.  Thus, I recommend employers use discretionary bonuses if they want to provide employees with additional pay for superior performance.

Employers should also consider reviewing their payroll to see what premium payments were made to employees in the past.  Employers need to consider whether or not they need to supplement those prior payments so that the premium equals the regular rate of pay.

I recommend every business to contact its legal counsel to consider the impact of the Court’s opinion on its workplace.  Wage and hour matters are already complex issues. The Court has now made these issues even more complex and the Court has also opened the door for more potential liability.

Doug Larsen

Fishman, Larsen & Callister

559.256.5000

larsen@flclaw.net


06.18.21

Cal/OSHA Update for Fully Vaccinated Employees: For Real This Time… We’re Pretty Sure.

COVID-19

The past few weeks have been a Cal/OSHA Roller Coaster, haven’t they?
Updated regulations proposed, paused, revised, passed, withdrawn, and proposed again as well-meaning employers scrambled to keep up. The latest iteration of Cal/OSHA’s Emergency Temporary Standards (ETS) was released for public comment on June 11, and was passed by the Board on June 17.
It’s great news for employers, and we think it’s actually going to stick this time!

Physical Distancing

Surprisingly, the entire section on Physical Distancing is removed from the ETS. This means employers do not need to enforce distancing requirements for any employees, except when an employee is not vaccinated and cannot wear a face covering due to a health condition.

Face Coverings

Your fully vaccinated employees are not required to wear face coverings in any situations.

Employees who are not fully vaccinated must be provided with face coverings (N95 masks or “respirators” not necessary) and are required to wear them, with the following exceptions:
• They are alone in a room or vehicle,
• They are eating/drinking outdoors, or indoors at least 6 feet away from others and outside air supply has been maximized to the extent feasible, or
• They are exempt from wearing a face covering due to a physical/mental health condition.
An employee cannot be prevented from wearing a face covering if they choose to do so, unless it would create a safety hazard, and employees must be provided with face coverings if requested, regardless of vaccination status.

If an unvaccinated employee requests a respirator (N95 mask) for voluntary use when working indoors or in a vehicle with more than one person, the employer must provide a respirator of the correct size and encourage the employee to use it.

If an employee cannot wear a mask due to a health condition, he/she should wear a non-restrictive alternative, such as a face shield with a drape on the bottom. If that is not possible due to the health condition, and if the person is not fully vaccinated, he/she must maintain 6 feet distance from others and be tested weekly for COVID-19 at the company’s expense and on paid time.

COVID Testing and Workplace Exclusion

Previous rules regarding exclusion of employees who report exposure to a COVID-19 case remain in place, with the following exceptions:

  • The employee is fully vaccinated, or
  • The employee previously had COVID-19 and has remained symptom-free for at least 90 days since the onset of his/her symptoms (or at least 90 days since taking a positive test, if asymptomatic.)

If the exposure is work-related, the employee must receive full pay and benefits as if he/she were still working, unless the employee is receiving State Disability Insurance payments or is covered by workers’ compensation disability benefits.

If any employee reports potential COVID-19 symptoms, regardless of vaccination status, COVID-19 testing must be made available at no charge to the employee during paid time. If the employee is not vaccinated, he/she should be excluded from the workplace until at least ten days have passed since the onset of symptoms.

Employee Vaccination Status

Cal/OSHA defines “fully vaccinated” as: “the employer has documented that the person received, at least 14 days prior, either the second dose in a two-dose COVID-19 vaccine series or a single-dose vaccine.”

Because almost all of the updated regulations hinge on whether or not an employee has received the vaccine, we recommend asking employees to provide copies of their vaccination cards for your records (stored in their medical/confidential files.) Any employee who prefers not to provide this information must follow the protocols for unvaccinated staff.

Moving forward, employers may consider including COVID-19 vaccination in the physical requirements of a job and request the information from job applicants. Of course, inability to receive the vaccine due to a medical condition or religious belief must be reasonably accommodated in the same manner as other disabilities/observances.

COVID-19 Prevention Plans

If Sierra HR has prepared a COVID-19 Prevention Plan (CPP) for your business, it will need to be revised based on the new Cal/OSHA standard. Thankfully, the updates will make the plan document simpler, rather than adding new requirements. We will be working on updated CPP wording, and will reach out to you when the new information is ready. Please contact us directly if you have questions about the status of your CPP.

 

This feels like several wonderful steps in the right direction, but we know there will continue to be ups and downs. Sierra HR Partners will maintain awareness of changing state and local regulations, and update clients of any new requirements. Please don’t hesitate to reach out to one of our certified Consultants with any questions or concerns you have. We’re here to help!

 

 


06.15.21

What California Businesses Can Expect on June 15, 2021

COVID-19

We’re told that California is reopening for business on June 15th. What exactly does this mean? Here are some take-aways:

• Physical distancing and capacity limitations are eliminated for customers, clients, attendees, guests and patrons.

• Vaccination or a negative test is required for indoor mega events.

• Masking is not required for fully-vaccinated persons except for public transportation, K-12 schools and childcare, healthcare settings, long-term care facilities, correctional facilities, and homeless, emergency or cooling centers. Persons younger than two, with medical conditions, or hearing impaired are exempted from the mask requirement.
The rules for workers differ from the rules for persons patronizing California businesses. Under Cal/OSHA’s proposed COVID-19 Standards, as revised on June 12, 2021, two of the more important provisions are:

• The physical distancing requirement has been eliminated for most purposes. Distancing is required, however, when workers have been exposed to a COVID-19 case.

 • Employees who are fully vaccinated are not required to wear face coverings. The employer must provide masks to all other employees working indoors and, in a vehicle, and make sure the masks are worn properly.

• The employer is not required to provide workers with a respirator. But if an unvaccinated employee who works indoors chooses to wear one, the employer must provide it and ensure it is the correct size.

These Standards won’t go into effect unless the Standards Board approves them on June 17th.

Doug Larsen
Fishman, Larsen & Callister
559.256.5000


06.11.21

The COVID Shuffle (Or Rewind)

COVID-19

An excerpt from Doug Larsen’s recent article:

“On November 30, 2020 Cal/OSHA adopted Emergency Temporary Standards to deal with the COVID-19 pandemic. Employers quickly and begrudgingly complied, spending significant time and energy implementing a COVID Prevention Program.

In May of 1021 Cal/OSHA teases employers with revisions to the Standards. But the morning of the Cal/OSHA Standards Board meeting, the planned revisions were scrapped.

Over the Memorial Day weekend Cal/OSHA issued the second set of revisions to the Standards. After a lengthy healring Standards Board adopted these revised revisions, determining they were better than the original Standards from November 2020.

Employers have been making changes to the workplace to prepare for June 15th. But just a few hours ago, Cal/OSHA voted to withdrawal the revisions they approved on June 3rd.  

Why? Because they want to consider the latest guidance on masking from the COD and the California Department of Public Health. Really? Don’t we already have the CDC guidance? Hasn’t Governor Newsom confirmed he will open the sate’s economy on June 15th?

The CDC states, “fully vaccinated people can resume activities without wearing a mask or physically distancing…” The only exception is for other laws that would require masking. 

But why would any government impose masking requirements on fully vaccinates people if government followed science? Good questions, isn’t it? We also know that plexiglass does not inhibit an aerosol (but that hasn’t stopped Cal/OSHA from mandating this false hope). And the CDC acknowledged that the risk of transmitting COVID via surfaces is very low. So why must we disinfect so frequently?

Doesn’t it make you wonder if government is playing politics?

What does the CDPH say about masking? A memorandum published June 9th tells us fully vaccinated person are not required to wear masks outdoors except during crowded events. Unvaccinated persons must wear facemasks outdoors when distancing cannot be maintained.

However, the CDPH also tells us that effective June 15th, we now have a new set of rules. Fully vaccinated people are exempt from mask-wearing except when on public transit, at school or childcare, in healthcare settings, in correctional facilities, and in shelters.

Come June 15th, businesses “may choose” one of the following options: (Does this mean a business must choose an option, or can it ignore the CDPH?)

  • Provide patrons with vaccination requirements and allow them to self-attest;
  • require proof of vaccination; or
  • Require all patrons to wear a mask.

Let’s get real. Self-attesting is unrealistic. Asking every patron to wear a mask or show proof of vaccination will just lose business to a competitor. Governor Newsom said business will fully reopen on June 15th so what’s up with the continuing mask rules? Good questions. There is absolutely no good answer.

When will California eliminate the COVID restrictions? Your guess is as good as mine.”

 


06.10.21

Cal/OSHA Changes Postponed… AGAIN New Rules for Fully Vaccinated Employees On Hold

COVID-19

Cal/OSHA Changes Postponed… AGAIN
New Rules for Fully Vaccinated Employees On Hold

On Thursday, June 3, Cal/OSHA approved new guidelines for physical distancing and face coverings in the workplace for vaccinated and unvaccinated employees. The updated standards were set to be effective June 15, and many companies started making plans for implementation.

However, on June 9, the Board voted to withdraw the June 3 standards. This move appears to be in response to a State Health Officer’s letter pointing out that the rules conflict with California’s anticipated June 15 end to masking and distancing requirements in almost all situations.

The Occupational Safety and Health Standards Board will consider new revisions to the COVID-19 regulations as soon as June 17. In the meantime, the masking and physical distancing protocols adopted in November 2020 will continue to be in effect.

What Am I Supposed to Do Now?

In short, hang in there and try to be patient. We do not know how Cal/OSHA will change its proposed ETS rules, but for now California employers should continue the face covering and physical distancing policies we’ve all come to know and love.

In anticipation of relaxed protocols for fully vaccinated employees, you can encourage staffers to get the vaccine. Remind them of the federal Emergency Paid Sick Leave or state Supplemental Paid Sick Leave programs that will provide paid time off for vaccination appointments and recovery from related symptoms/side effects. (Yes, you may ask for a copy of the vaccination card as documentation of these appointments.)

We also suggest developing plans for how you might accommodate an employee who cannot receive the vaccine due to a medical condition or a religious belief, and how you will respond to employees who remain unvaccinated for reasons not protected by law. The postponement of Cal/OSHA changes may allow for a more intentional, better-communicated response to these issues.

(If the paragraphs above sound familiar, it’s because this is exactly what we said the last time Cal/OSHA had an abrupt withdrawal/revision of its regulations. Rest assured, Sierra HR is watching closely for new developments and we will let clients know as soon as there is updated information.)