2017 Labor and Employment Law Update

By Christina Tillman, McCormick Barstow LLP, Attorneys at Law BIO

In 2016, the California legislature passed a number of laws affecting cardrooms.  The following article summarizes those laws with the most impact on cardrooms that go into effect January 1, 2017, unless otherwise noted.  Make sure you update your employee handbooks for 2017!

Minimum Wage Increase
For cardrooms employing more than 25 employees, minimum wage will increase to $10.50 per hour.  This increase will continue for the next seven years, reaching $15.00 per hour in January 2022.  For those with 25 or fewer employees, the minimum wage increase begins January 1, 2018.
DOL Final Rule on Overtime Blocked
In November 2016, a federal judge blocked the DOL’s regulation that would have increased the minimum salary required for exempt employees to $47,476.  Although this regulation is blocked at the federal level, California’s minimum wage increase will increase minimum pay rates for exempt, salaried employees.  Their pay rate must equal at least 2x the minimum wage for a 40-hour work week.
In November 2016, recreational use of marijuana became legal in California for persons over the age of 21.  While marijuana use is legal, employers can refuse to hire or terminate employment of any individual who tests positive for THC in pre-employment or reasonable suspicion drug tests.  In general, use of marijuana by any on duty employee may be prohibited like alcohol or any other recreational drug.
Background Checks
Cardrooms cannot ask an applicant to disclose any arrest or detention that did not result in a conviction and cannot use such information as a factor in connection with employment.  This prohibition has been expanded to prohibit any information concerning or relating to an arrest, detention, processing, diversion, supervision, adjudication or court disposition that occurred while the person was subject to the process and jurisdiction of the juvenile court.  Many cities have implemented further restrictions on when and how an employer may inquire into applicants’ criminal background records.
Equal Pay
When setting pay for above minimum-wage earning employees, cardrooms must be mindful of California’s laws, regardless of sex, race, or national origin, to be paid the same for similar work, unless the difference in pay is based on a seniority system, merit system, or other “bona fide factor” such as education, training or experience.  An individual’s prior salary cannot, by itself, justify any disparity in compensation.
Class Action Waivers
The National Labor Relations Board and some federal courts continue to find class action waivers in employment-related arbitration agreements unlawful.  Any arbitration agreements should be presented as voluntary if a class action waiver is included.
The information in this article is provided for informational purposes only, and should not be construed as legal advice on any subject matter.  Please consult and attorney.
Published January 2017