Legal Update - Upcoming California Legislation for 2018

California Enacts Salary History Prohibition Law
New Law Effective January 1, 2018

California has enacted a law that generally prohibits employers from relying on an applicant's salary history.

Salary History Prohibition and Additional Rules

An employer is prohibited from relying on the salary history information of an applicant as a factor in determining whether to offer employment to an applicant or what salary to offer him or her.

An employer is also prohibited from—orally or in writing—seeking salary history information (including compensation and benefits) about an applicant.

An employer (upon reasonable request) must provide the pay scale for a position to an applicant applying for employment. The law does not allow prior salary—by itself—to justify any disparity in compensation.


The law does not prohibit an applicant from voluntarily and without prompting disclosing salary history information to a prospective employer. If an applicant does as such, the law does not prohibit that employer from considering or relying on that voluntarily disclosed salary history information in determining the salary for that applicant.

Action to be taken:

Employers should carefully review your employment applications (Paychex application is already updated accordingly) and hiring processes to ensure that they do not impermissibly inquire into, or rely upon, salary history information. Job applications and new hire packets should be amended to remove any inquiries into prior salary history. All staff involved in the hiring process should be trained about the law and how it impacts the types of inquiries and questions that are permissible.

California Passes Parental Leave Act
Law Effective January 1, 2018

California has enacted the New Parent Leave Act.


The law applies to employers with 20 or more employees.

The law covers employees with more than 12 months of service with their employers, who have at least 1,250 hours of service with their employers during the previous 12-month period, and who work at a worksite that has at least 20 employees within 75 miles.

Parental Leave Rights

Upon request, an employee may take up to 12 weeks of parental leave to bond with a new child within one year of the child's birth, adoption, or foster care placement. The employee is entitled to utilize accrued vacation pay, paid sick time, other accrued paid time off, or other paid or unpaid time off negotiated with the employer, during the period of parental leave.

Note: If the employer does not provide a guarantee of employment in the same or a comparable position upon the leave's termination, the employer is deemed to have refused to allow the leave.

Health Benefits

Employers may not refuse to maintain and pay for coverage under a group health plan for an eligible employee who takes parental leave for the duration of the leave (not to exceed 12 weeks over the course of a 12-month period), starting on the date the leave begins. Employers may not refuse to maintain and pay for such coverage at the level and under the conditions that coverage would have been provided if the employee had continued to work in his or her position for the duration of the leave.

However, an employer may recover the premium that it paid for maintaining coverage if certain conditions occur.

Action to be taken:

SB 63 goes into effect on January 1, 2018. Prior to that date, if you are an employer with between 20 and 49 employees within 75 miles, you should carefully review and revise your leave policies to comply with the new requirements of the law.

California Enacts “Ban the Box” Law
Law Effective January 1, 2018

Law Creates New Procedures Governing Job Application Process

Prohibited Employer Actions

Employers with 5 or more employees are generally prohibited from:

  • Including on any employment application—before the employer makes a conditional offer of employment to the applicant—any question that seeks the disclosure of an applicant's conviction history.
  • Inquiring into or considering the applicant's conviction history (including any inquiry about conviction history on any employment application) until after the employer has made the applicant a conditional offer of employment.
  • Considering, distributing, or disseminating certain criminal history information (§12952(a)(3)) while conducting a conviction history background check in connection with any application for employment.
  • Interfering with, restraining, or denying the exercise of (or the attempt to exercise) any right provided under the law.

Note: The law does not prevent an employer from conducting a conviction history background check that satisfies the provisions above.

Procedure when Denying Employment

Employers must follow the procedure below when denying employment:

Individualized assessment. An employer that intends to deny an applicant a position solely (or in part) because of the applicant's conviction history must make an individualized assessment of whether the applicant's conviction history has a direct and adverse relationship with the specific job duties that justify denying the applicant the position. In making this assessment, the employer must consider certain factors (§ 12952(c)(1)(A)).

Note: An employer may (but is not required to) commit the results of this individualized assessment to writing.

Notification. If the employer makes a preliminary decision that the applicant's conviction history disqualifies him or her from employment, the employer must notify the applicant of this preliminary decision in writing. That notification may (but is not required to) justify or explain the employer's reasoning for making the decision. Regardless, the notification must contain certain information (§
12952 (c)(2)).

Applicant's response. The applicant must have at least 5 business days to respond to the notice described above before the employer may make a final decision. If the applicant notifies the employer in writing within the 5 business days that the applicant disputes the accuracy of the conviction history report that was the basis for the preliminary decision to rescind the offer and that the applicant is taking specific steps to obtain evidence supporting that assertion, then the applicant must have 5 additional business days to respond to the notice.

Note: The employer must consider information submitted by the applicant under the paragraph above before making a final decision.

Final decision. If an employer makes a final decision to deny an application solely (or in part) because of the applicant's conviction history, the employer must notify the applicant in writing of certain information (§ 12952(c)(5)), including the right to file a complaint with the state.

Action to be taken:

Prior to that January 1st, you should carefully review your employment applications and hiring processes to ensure compliance with the law’s requirements, specifically not seeking or relying on criminal history information until after a conditional offer of employment has been made. If you wish to rely on criminal history information, you will need to understand and follow the specific individualized assessment and employee notice requirements contained in the new law.

New Mandatory Poster on Transgender Rights for California Workplaces

The new transgender rights poster must be displayed starting January 1, 2018.

California recently passed a new law that requires all California employers to post a “Transgender Rights in the Workplace” poster starting January 1, 2018.

The new transgender rights poster must be displayed along with other mandatory workplace notices in a prominent and accessible location in the workplace. The Department of Fair Employment and Housing, the state agency charged with enforcing California’s civil rights laws, has developed the poster. The correct version is dated November 2017, but the posting is not mandatory until January 1, 2018.

The poster, in part, follows regulations developed by the Fair Employment and Housing Council that went into effect on July 1, 2017.

Key topics covered by the poster include:

  • Definitions of terms such as transgender, gender identity, gender expression and gender transition.
  • A discussion on the right of employees to use restrooms, locker rooms and other similar facilities corresponding to their gender identity.
  • The importance of allowing an employee to dress in accordance with the employee’s gender identity and expression.

“We expect this posting requirement to increase understanding of the law and assist California employers in providing safe and inclusive work environments,” said Kevin Kish, Director of DFEH, in a statement.

Mandatory Training Requirement

SB 396 also requires mandatory sexual harassment prevention training to include a component regarding gender identity, gender expression and sexual orientation. This new law takes effect on January 1, 2018.

California’s mandatory harassment prevention training requirement applies to employers with 50 or more employees and requires training of all supervisors.

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