State & Local Employment Law Developments: Q4 2018

State and local governments are increasingly regulating the workplace. Although it is not possible to discuss all state and local laws, this update provides an overview of recent and upcoming legislative developments to help you ensure that your organization stays in compliance.

California

Confidentiality Clauses in Settlement Agreements: SB 820 prohibits a settlement agreement from including a confidentiality provision that prevents the disclosure of factual information pertaining to civil or administrative complaints of sexual assault, sexual harassment or workplace harassment, or discrimination based on sex. Any provision in a settlement agreement entered into on or after January 1, 2019, that prevents the disclosure of such information will be considered void as a matter of public policy. The law does permit a provision, however, that would safeguard the claimant’s identity and any facts that could lead one to discover the claimant’s identity (but only at the request of the claimant and in matters not involving a government agency or public official), as well as a provision that prevents the disclosure of the amount paid to settle the claim, at the request of either party.

Criminal Background Checks:

• Under existing law (California Labor Code Section 432.7), employers are generally prohibited from asking an applicant to disclose, seeking from any source or considering as a factor in determining employment, any information related to a criminal conviction that has been judicially sealed or expunged. However, current law does not prohibit employers from asking about criminal convictions that have been judicially sealed or expunged if the employer is required to obtain such criminal conviction information pursuant to state or federal law.
• Effective January 1, 2019, SB 1412 provides that employers are not prohibited from seeking, receiving or considering an applicant’s criminal conviction history, including those convictions that have been judicially sealed or expunged, if the employer is required by state, federal or local law to conduct criminal background checks for employment purposes. However, SB 1412 narrows an employer’s ability to consider sealed or expunged convictions to only those circumstances where a particular conviction would legally prohibit someone from holding that job.

For additional information regarding California laws, please refer to our firm’s December 17, 2018, legal update titled New California Laws for 2019: What Employers Should Know.

Connecticut

Pay History Inquiries: Effective January 1, 2019, HB 5386 prohibits employers from inquiring about an applicant’s pay history before the applicant has accepted an offer of employment that includes compensation, unless the applicant voluntarily discloses the information.

Delaware

Sexual Harassment Training: Effective January 1, 2019, employers with at least 50 employees in Delaware must provide interactive sexual harassment training as follows: to new employees within one year of the commencement of employment and every two years thereafter; to existing employees by January 1, 2020, and every two years thereafter; to new supervisors within one year of the commencement of employment as a supervisor and every two years thereafter; and to existing supervisors by January 1, 2020, and every two years thereafter.

Florida

Minimum Wage: Effective January 1, 2019, the minimum wage increased from $8.25 to $8.46 per hour.

Illinois

Business Expense Reimbursement:

• Effective January 1, 2019, amendments to the Illinois Wage Payment Collection Act (IWPCA) will require employers to reimburse their employees for “all necessary expenditures or losses incurred by the employee within the employee’s scope of employment and directly related to services performed for the employer.” 820 ILCS 115/9.5.
• “Necessary expenditures” is defined as “all reasonable expenditures or losses required of the employee in the discharge of employment duties and that inure to the primary benefit of the employer.” Employers are not responsible for losses due to an employee’s own negligence, due to normal wear or due to theft unless the theft was a result of the employer’s negligence.
• An employee requesting reimbursement must submit any necessary expenditures with appropriate supporting documentation within 30 calendar days after incurring the expense unless the employer has implemented a written expense reimbursement policy that extends the time for submitting requests for reimbursement. When supporting documentation is nonexistent, missing, or lost, the employee may submit a signed statement regarding these receipts.
• An employee is not entitled to reimbursement if: (i) the employer has an established written expense reimbursement policy and (ii) the employee fails to comply with the employer’s policy. An employer is not liable under the law unless the employer authorized or required the employee to incur the necessary expenditure or the employer fails to comply with its own policy.
• If the employer’s written expense reimbursement policy establishes specifications or guidelines for necessary expenditures, the employer is not liable under the new amended law for the portion of the expenditure amount that exceeds the specifications or guidelines of the policy so long as the employer does not institute a policy that provides for no reimbursement or de minimis reimbursement.

For additional information regarding Illinois laws, please refer to our firm’s December 3, 2018, legal update titled Ringing in the New Year: What Illinois Employers Can Expect in 2019.

Michigan

Sick Time: On September 5, 2018, the Michigan legislature passed the Earned Sick Time Act (ESTA), which takes effect 90 days after the end of the legislative session. On December 14, 2018, the outgoing Republican Governor signed into law the Paid Medical Leave Act (PMLA), which amends the ESTA. The PMLA narrows the ESTA’s definition of eligible employees, narrows the definition of covered employers to employers with at least 50 employees, slows the rate at which employees accrue paid sick time, allows employers to cap an employee’s paid sick time accrual at 40 hours per year, reduces the annual paid sick time usage cap to 40 hours and caps the year-end carryover of unused paid sick time to 40 hours.

Minimum Wage: In September 2018, the Michigan legislature passed a law increasing the minimum wage to $12.00 per hour through a series of annual increases through 2022. The first increase was scheduled to raise the minimum wage from $9.25 to $10.00 per hour effective January 1, 2019. However, on December 14, 2018, the Governor signed into law an amendment to the minimum wage legislation, which will raise the minimum wage to $12.05 per hour through a series of annual increases through 2030. Under the amended law, the minimum wage increases from $9.25 to $9.45 per hour effective January 1, 2019.

Minnesota

Minimum Wage: Effective January 1, 2019, the minimum wage for large employers (employers with at least $500,000 in annual gross revenue) increased from $9.65 to $9.86 per hour, while the minimum wage for small employers rose from $7.87 to $8.04 per hour.

Montana

Minimum Wage: Effective January 1, 2019, the minimum wage increased from $8.30 to $8.50 per hour.

New Jersey

Minimum Wage: Effective January 1, 2019, the minimum wage increased from $8.60 to $8.85 per hour.

New York

New York City Lactation Support: Effective March 18, 2019, New York City employers with at least four employees must provide lactation rooms for employees and distribute written lactation policies to employees upon hire.

New York City Sexual Harassment Training: Effective April 1, 2019, New York City employers with at least 15 employees must conduct annual sexual harassment training for employees.

Westchester County Sick Time: Effective April 10, 2019, Westchester County employers must allow eligible employees to accrue one hour of sick time for every 30 hours worked, up to 40 hours of sick time per year. Employers with at least five employees must provide paid sick time, while employers with fewer than five employees must provide unpaid sick time.

Ohio

Minimum Wage: Effective January 1, 2019, the minimum wage increased from $8.30 to $8.55 per hour.

Oregon

Equal Pay: Effective January 1, 2019, the Oregon Bureau of Labor and Industries started enforcing the pay history provision of the pay equity law, which prohibits employers from seeking pay history before making an offer of employment that includes an amount of compensation. The pay equity law also prohibits employers from determining compensation for a position based on an applicant’s current or past compensation.

Pennsylvania

Philadelphia Fair Scheduling: On December 20, 2018, Philadelphia passed a fair scheduling ordinance. Effective January 1, 2020, employers in the retail, fast food and hospitality industries with more than 250 employees and more than 30 locations worldwide must provide employees with at least 10 days’ advance written notice of their work schedules.

South Dakota

Minimum Wage: Effective January 1, 2019, the minimum wage increased from $8.85 to $9.10 per hour.

Vermont

Minimum Wage: Effective January 1, 2019, the minimum wage increased from $10.50 to $10.78 per hour.

Sick Time: The Vermont sick time law became effective January 1, 2017. Through December 31, 2018, employees could accrue and use 24 hours of paid sick leave per year. Effective January 1, 2019, employees may accrue and use 40 hours of paid sick leave per year.