2019 Newsletter & Employment Law Update

Happy New Year to our clients and colleagues!

For 2019, the key imperatives for most employers in California will be attracting and retaining employees. Many employers are finding it more challenging to retain their employees, especially top performers. The 2017 North Bay fires and the related impact on housing supply and affordability continue to have an impact on the labor market, particularly in the lower wage positions as cited in a recent North Bay Business Journal story. We also witnessed an uptick in voluntary turnover due to the stronger economy and labor shortage, which provides more opportunities for employees to jump ship or move on to higher levels roles. Retention strategies such as deepening employee engagement, fostering career development, providing competitive compensation and benefits, and enhancing leadership effectiveness will continue to be critical factors in building a stable and productive workforce.

Look back in 2018
Human Resources

In 2018, HR compliance/policy audits and HR operations/staffing assessments continued to be in high demand. So far, we always find ways to bring clients into more complete compliance and tune up policies to better serve the needs of the organization. Our HR assessments often reveal skill or process deficits that cause overstaffing, ineffective practices or inefficiencies. Once HR staff and processes are optimized, the HR department (or in many cases, person) is better able to support business initiatives and run more efficiently. Contact us if you would like our team to evaluate your existing HR programs, policies, or infrastructure. We can help you design a productive and sustainable HR system to support your company’s 2019 goals and objectives. 


Look Back in 2018
Organization & Leadership Development

Over the past few years, our team has taken the lead on developing and facilitating multiple leadership academies for clients in California. These programs attract emerging leaders and help them develop the skills and knowledge they need to maximize their performance and contributions. In addition to a multi-rater leadership development exercise (360 feedback), workshops on change management, self-mastery, and leading teams are combined with skill building in the areas of interpersonal communication, executive presence, and facilitation to help prepare these leaders for the challenges and opportunities that lie ahead. Of course, coaching plays a key role in these programs, too. In response to client demands, we have enlarged our coaching pool, adding several talented Bay Area coaches to our roster. Our firm now serves as the primary coaching vendor to multiple organizations in which senior leaders can elect to work with their preferred HR Matrix coach in custom programs designed to suit their specific needs and timeframes. 


Popular Services

  • HR Consulting. Through onsite or virtual advice and consultation, we support all aspects of your organization’s Human Resources needs and practices to ensure you are in compliance and operating efficiently.
  • Employee Handbooks. We can update your handbook or create one from scratch. All our handbooks are customized to your company size and needs.
  • HR Optimization Assessments & Audits. We can evaluate your HR infrastructure, staffing, processes, and practices to ensure you are in compliance and operating efficiently.
  • HR Forms Package. With regulations changing frequently, we provide employers with a comprehensive forms package to ensure compliance with local, state, and federal laws.
  • Compensation Plan Design. Creating fair and competitive salary structures is important for recruiting and retaining top talent in a highly competitive job market. We conduct salary surveys, develop pay ranges based on internal and external equity, and help you design robust and strategic pay practices that align with your business needs.
  • Harassment Training. 2019 requires increased training for most employers. Our highly interactive and informative training helps educate your workforce and keep you in compliance and out of trouble.
  • Organization Development. Are conflicts, change, growth or team dynamics holding your organization back? We believe the best solutions are the ones we figure out together. Our team of skilled organization and management consultants will work with you to identify underlying dynamics, confront issues, and implement solutions based on your goals. We’ll agree on a path that suits your needs—with buy-in and teamwork that delivers meaningful and lasting organizational improvement.
  • Coaching. Engage employees in learning and growth based on their own initiative and commitment, helping to build trust, cultivate communication, and hone management, planning, and collaboration skills.
  • Team 360. Help build mutual support, accountability, and leadership skills through a unique team-based experience for senior managers and above.
  • Search and Recruitment. Our expertise with both active and passive candidate sourcing gives you the edge in finding qualified talent, especially for hard-to-fill or niche positions. We understand the implications of company culture and organizational fit, resulting in more successful hires for you.
Click here to view all our service offerings

Employment Law & Compliance Updates 

Following is a summary of employment law changes for 2019.
Feel free to contact us if you have any questions.
1. Harassment Training Expansion (SB 1343)
Under SB 1343, all employers with five (5) or more employees will be required to provide two (2) hours of sexual harassment training to supervisors and one (1) hour to nonsupervisory employees within six (6) months of hire or promotion. This requirement must be completed by January 1, 2020. All trainings must be delivered every two years.

TO DO: Employer Action

  • Provide 2-hour harassment training to managers and supervisors every two years, and within six (6) months of someone becoming a new supervisor.
  • Provide 1-hour harassment training to all nonsupervisory employees every two years within six (6) months of hire.
  • Start putting a plan together now on how you want to train your employees and supervisors.
  • Update your discrimination, harassment, and retaliation prevention policy to reflect the new training requirements.
  • Contact us to arrange your training session(s) or seek out an online training option (for online training sources, we suggest the HR California online training).
2. Independent Contractors — California ABC Test
Although this law passed in April 2018, many employers are still grappling with compliance. Penalties for misclassification are stiff and enforcement is escalating, so compliance is more important than ever. The change in law requires a much stricter test when determining whether or not a person qualifies as an independent contractor in California. As a result, many independent contractors will need to be converted to part-time or full-time employees and paid through the normal payroll process. To classify a worker as an independent contractor, the employer must be able to establish the worker meets all of the ABCs below:
  1. The worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact.
  2. The worker performs work that is outside the usual course of the hiring entity’s business.
  3. The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.
TO DO: Employer Action

  • Conduct an evaluation to determine whether your independent contractors are properly classified and take steps to ensure compliance.
  • If it’s determined they do not meet the ABC test, develop a job description and determine their FLSA status (Exempt or Non-exempt). Transfer your independent contractors onto your normal payroll process and onboard them appropriately.

3. Minimum Wage Increase

On January 1, 2019, California’s minimum wage increased to $11.00 per hour for employers with 25 or fewer employees and to $12.00 per hour for employers with 26 or more employees. If your business is within a city/county with a local minimum wage ordinance, be sure to check on the minimum wage requirements.

TO DO: Employer Action

  • Increase wages up to minimum wage based on employer size.
  • Check local city/county minimum wage ordinance and increase wages accordingly.
  • Ensure exempt employee salaries meet or exceed the new thresholds –twice minimum wage.

4. No De Minimis Work in California
Under Federal law, the Fair Labor Standards Act (FLSA) allowed for minuscule amounts of work to be overlooked: “insubstantial or insignificant periods of time beyond the scheduled working hours, which cannot as a practical administrative matter be precisely recorded for payroll purposes, may be disregarded.” However, California law states that workers must be paid for all hours worked, as there is no language of the wage orders that incorporates the federal de minimis rule.

TO DO: Employer Action

  • Ensure your timekeeping systems are able to capture all of the time that employees are working.
  • Ensure that employees report all time worked.
  • Revisit your “No Working Off the Clock” policy and ensure that managers and employees are clear about how to handle after-hours and/or off-hours requests/work, including emails or texts.

5. Gender Representation on Boards of Directors (SB 826)
By the end of 2019, publicly held corporations in California will be required to place at least one female director on its board. Corporations may increase the number of directors on its board to comply. Based on the board’s size, up to three female members may be required by the end of 2021.

6. Harassment (SB 1300)
SB 1300 further challenges employers to defend against workplace harassment claims as it states that a single act of harassing conduct is sufficient to create a “triable issue of a hostile work environment”. This decreases the standard of proof for bringing a harassment claim and declared that the legal standard for sexual harassment claims should not vary by type of workplace. More reason to ensure managers and staff are trained up to prevent/report harassment.

In addition, it prohibits an employer from requiring an employee, in exchange for a raise or bonus, or as a condition of employment or continued employment to:

  • Agree not to sue or bring a claim against the employer under FEHA; or
  • Sign a non-disparagement agreement preventing the employee from disclosing information about unlawful acts in the workplace, including but not limited to sexual harassment.

7. Sexual Harassment — Defamation Protection (AB 2770)
Under this new law, employers and victims of sexual harassment will receive increased protections from liability in defamation lawsuits. The law also expands protection for the employer from liability based on injury to an alleged harasser’s reputation after a complaint of sexual harassment has been made.

8. Injury Reporting — Statute of Limitations (AB 2334)
Employers’ liability for workplace injury reporting violation penalties has been extended from six (6) months to five (5) years under AB 2334. A change in the code’s definition of an “occurrence” as it relates only to citations for recordkeeping purposes means citations may be issued for the entire five-year mandatory record retention period until they are corrected or discovered by the California Division of Occupational Safety and Health (Cal/OSHA), or until any recordkeeping duty is eliminated.

TO DO: Employer Action

  • Review their record-keeping and retention processes for workplace injuries or illnesses, especially their OSHA 300 logs, and make any changes necessary to ensure compliance.


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