More New Laws Effective This Year!!
As if we didn’t have enough! These new laws are going into effect this year. The first change involves Labor Code Section 515 which addressed the payment of a fixed salary to non-exempt employees. Employers have at times included known overtime in the fixed salary as a way of making it easier. This opportunity is gone with the passage of AB2103 which amends Labor Code Section 515. As a result, the payment of a fixed salary to a non-exempt employee cannot known or anticipated overtime. In other words, an employer may not claim to hire a non-exempt employee based on fixed salary (e.g., $900.00 per week) and later claim that the salary included overtime worked and paid. You have to covert the fixed salary to an hourly rate and use that number in the calculation of the overtime at 1.5 for all hours in excess of either 8 hours in the day or 40 hours per week or by 2 for hours in excess of 12 hours per day. Don’t forget to show the overtime rate and pay separately on the wage statement.
The second change, amends Labor Code Section 2751 which required employment “contracts” with those employees paid on a commission basis. Existing law requires that employment contracts contemplating commission payments must be in writing and clearly show the method by which commissions are to be calculated and paid. The new law exempts from this requirement any temporary and/or variable incentive payments (bonuses) that may increase, but do not decrease, payment under the written contract.
The third change amends Labor Code Sections 226 and 1198.5 regarding the inspection of personnel files by employees. The new law, AB2674, requires employers to maintain personnel records for three years following an employee’s separation from employment. In addition, it also permits current and former employees to inspect and receive copies of their personnel records within 30 days of submitting a request. The new law also states that the employer is not required to comply with more than one request per year by a former employee (with certain exceptions such as litigation). In addition, the employer must develop a written form that employees may use to request inspection and copy of personnel files and furnish this form to employees upon request.
That’s it for now but hold on, Jerry is still signing!
