Labor Day Musings

It's Labor Day and I have been laboring all day!  But I thought I would end my day with a few thoughts on the state of labor, and recent developments in workplace law. 

SB 432 and the Elimination of Alienation.  One thing I have noticed in politics over the last few years is the attempt to win an ideological debate by either demonizing the opposition as espousing bigotry or by making it unlawful to articulate their position.  It seems to me that SB 432 is of this nature.  With a stroke of the pen, the governor abolished Labor Code section 1725 from existence.  It is the definition of “alien” which referred to a person not born or fully naturalized as a citizen in the United States. 


Actually, that is the common definition of the term “alien” as found in most dictionaries.  It is not a pejorative definition.  Rather, it simply describes someone who has not acquired citizenship. 

So what was the need for the change in law?  In times of high unemployment, the Department of Finance is required to secure tentative plans for the extension of public works.  Preference for this work is given to California citizens first, to citizens of other states second, and third to aliens in California.  This law allows the state to change the preference for that work. 


Even with the change in preference for prevailing wage work, I hope California does not adopt a preference ignoring federal requirements of employment for only those persons authorized to work in the United States. 


The Ante is Upped with the FLSA.  The Department of Labor has announced plans to raise the white collar salary exemption to $47,892 in 2016.  There is no doubt that the FLSA minimum should be increased.  But this is an amazing stretch.  This amount is even substantially higher than California’s current white collar salary minimum of $37,440. 


Many employers may be caught off-guard.  And this increase will be particularly harsh on non-profits and other organizations that squeak by economically. 


By the way, under California law, only the employer (typically a corporation) can be held liable for wage violations.  But under state law individuals as well as the corporation can be held liable.  Just another reason to make sure your company is complying with the law. 


The NLRB Strikes Again.  The NLRB has decided that an employer can be held liable for labor violations committed by their contractors.  The Board said that a company using employees from a staffing agency should be considered a joint employer and pulled into the collective bargaining negotiations between the staffing agency and its employees, and also be held liable for any unfair labor practices engaged in by the staffing agency. 


The NLRB decided that the laws have not kept up with the changes in economic circumstances.  Therefore, it decided to legislate and make the laws up-to-date.  Surprise, surprise!  An agency in the Obama Administration deciding that it can unilaterally take action when it decides Congress has not acted. 



California’s Equal Pay Act --SB 358 This law prohibits an employer from paying any of its employees at wage rates less than the rates paid to employees of the opposite sex for substantially similar work, when viewed as a composite of skill, effort, and responsibility.  The law further requires an employer to affirmatively demonstrate that any wage differential is based upon a seniority system, a merit system, a system that measures earnings by quantity or quality of production, or a bona fide factor other than sex.  The employer must demonstrate that each factor relied upon is applied reasonably, and that the one or more factors relied upon account for the entire differential.  


The law prohibits an employer from discriminating against an employee because the employee seeks to remedy any alleged wage disparity.  An employee may bring a civil action for an alleged violation.  The DLSE is also authorized to enforce this law. 


I am all for equal pay.  Compensation should not be based on gender.  However, I find that this law invites litigation without clear, bright line rules.  This is another full employment law for attorneys. 


By the way, the justification for the law was that women earn 84 cents to the dollar men earn.  A study of wages paid at the White House shows a disparity of 88 cents to the dollar.  Does this suggest that President Obama is not an equal pay employer?  Or is the 4 cents what saves the compensation structure at the White House?