Senate Bill 497

On Oct. 8, 2023, California Gov. Gavin Newsom signed into law Senate Bill 497 – referred to as the Equal Pay and Anti-Retaliation Act. The bill amends California Labor Code 98.6, 1102.5 and 1197.5 to create a rebuttable presumption of retaliation if an employee is disciplined or discharged within 90 days of certain protected activity, including reporting suspected wage and hour violations or other violation of law. It creates the same rebuttable presumption for any discipline of an employee who exercises his/her rights under the Equal Pay Act. The law goes into effect Jan. 1, 2024.

Under the current law, a retaliation claim includes three stages of a shifting burden of proof: (1) the employee must establish a prima facie case of retaliation; (2) the employer must identify a legitimate, non-retaliatory reason for their act(s); and (3) the employee must prove that the employer’s non-retaliatory reason was a pretext for retaliation.

To establish a prima facie case of retaliation, an employee must demonstrate: (1) the employee engaged in protected activity; (2) the employer engaged in an adverse action against the employee; and (3) there was a causal nexus between the protected activity and the alleged adverse action. Adverse employment actions typically include demotion, suspension or discharge from employment.

Senate Bill 497 makes it easier for employees to establish a prima facie case of retaliation by creating a rebuttable presumption that the employer has retaliated against the employee if the employer takes an “adverse employment action” within 90 days of the employee having made a complaint. Upon establishing a prima facie case of retaliation, the employer must identify a legitimate, non-retaliatory reason for the alleged adverse employment action to shift the burden back to the employee to prove the reason for the non-retaliatory action was pretextual.

The bill further provides that, in addition to other remedies, an employer is liable for a civil penalty of $10,000 per employee per violation, “to be awarded to the employee who was retaliated against.”

Senate Bill 848

On Oct. 10, 2023, Gov. Newsom signed into law Senate Bill 848. The bill expands California’s unpaid leave law and requires that workers get five days of leave if they experience a miscarriage, stillbirth or other reproductive loss. Reproductive loss leave does not need to be taken on consecutive days but must be completed within three months of the reproductive loss event. The law goes into effect Jan. 1, 2014.

The new law applies to all employers with five or more workers, and employees must have worked at least 30 days before they are able to use reproductive loss leave.

Whether the reproductive loss leave is paid or unpaid depends on the employer’s existing leave policy. If no leave policy exists, the five days may be unpaid. Employees, however, are entitled to use vacation, sick leave or other paid time off that is otherwise already available.

Unlike bereavement leave, in which employees are required to provide documentation evidencing the death of a family member, the new law does not require an employee to provide any documentation in support of their reproductive loss leave. Furthermore, employers are required to maintain the confidentiality of any employee requesting reproductive loss leave and ensure the information is only shared with internal personnel as necessary.

Takeaways

With SB 497, 848 and 616 (a bill which increases the amount of paid sick leave from three to five days, beginning in the new year, discussed in our Oct. 6, 2023, advisory) Gov. Newsom continues to change the employment landscape. Employers are encouraged to review their policies and procedures on managing workplace complaints and disciplinary actions. Additionally, employers should work promptly to update their policies and handbooks to ensure practices are in compliance with the reproductive loss law. Both laws take effect Jan. 1, 2024.

If you have any questions about SB 497 or 848 and implementing updates to your employee handbook, workplace policies and procedures, or advice on employment-related questions, please feel free to reach out to your regular Armstrong Teasdale lawyer or one of the authors.