Shivani Sutaria Law Offices is pleased to provide this 2016 Year-End Employment Law Checklist to employers as they prepare for 2017. This checklist hits on a few important employment law issues to be considered at the end of the year.
Confirm Employee Headcount: Count your total number of employees for purpose of determining what laws are applicable to your company. Significant milestones to cross are 5, 15, 25 and 50 employees (i.e. Family Medical Leave Act applies to companies with 50 or more employees, ADA applies with 15 or more employees, California’s Pregnancy Disability Leave applies with 5 or more employees).
Check Job Classifications and Job Descriptions:Job responsibilities, essential functions and compensation can change throughout the year. It is a good time to update job descriptions. Also consider assessing whether your independent contractors are properly classified or should be converted to employees. Employers should also assess whether employees are properly classified as non-exempt v. exempt. With California’s minimum wage increasing to $10.50/hr, employees will need to earn a salary of at least $43,680/yr to meet CA’s minimum salary threshold for exempt classification. The federal overtime rule issued in 2016 would have increased the exempt minimum salary threshold to $47,476 nationwide by December 1, 2016, but it has temporarily been halted by a court and thus implementation is not currently required.
Conduct a Compensation Audit:Effective January 1, 2017, California employers must not compensate its employees less than the amount paid to employees of a different race or ethnicity for substantially similar work. In light of this new law and the gender pay equity law that went into effect last year, employers should consider: 1) Evaluating employees’ job responsibilities and compensation across the company by gender, race and ethnicity; 2) Identifying objective criteria used to determine compensation, raises and bonuses; 3) Reviewing and updating, if necessary, company policies on confidentiality and discipline to allow discussion of wages among employees; 4) Making adjustments to employees’ compensation if objective criteria cannot explain pay disparities among the genders; and 5) Training managers and HR on what acceptable objective factors to utilize when making compensation-related decisions.
Audit and Revise Hiring Documents:In the last several years, California and local jurisdictions have enacted laws that restrict the criminal history questions employers can ask on employment applications. Review and revise, if necessary, applications to ensure legal compliance. In November 2016 a new version of the Form I-9 was released; employers are required to use that new version by January 22, 2017. Remember, I-9s should be maintained in a file separate from the personnel file.
Verify Posters and Notices: Verify that you have up current versions of all the required posters and notices especially in light of California’s minimum wage increasing to $10.50/hr on January 1, 2017. Check to make sure whether your city has a higher minimum wage requirement.
Ensure Vacation and Sick Leave Carryover:California law prohibits a “use it or lose it” vacation policy so ensure unused accrued vacation is carried over to 2017. Also, if your company is using the accrual method under California’s paid sick leave law, unused accrued sick leave must be carried over to 2017 but can be capped at 48 hours.