Benefit News

New California Laws Set to Take Effect

November 08, 2017

California Governor Jerry Brown recently signed several pieces of legislation into law pertaining to health benefits, as well as labor and employment issues impacting California employers. The following briefly summarizes significant laws that were enacted. These are generally scheduled to take effect January 1, 2018, unless otherwise noted.

For additional information, please contact your Burnham Benefits Consultant or Burnham Benefits at 949-833-2983 or inquiries@burnhambenefits.com.

New Laws Impacting Health Benefits

S.B. 17. Prescription drug costs
Beginning with their October 1, 2018 filing requirement, this new law requires health insurers and health care service plans (e.g., HMOs) to file with the Department of Insurance, or the Department of Managed Health Care, as applicable, specific cost information regarding covered prescription drugs for the departments to assess the overall impact of drug costs on healthcare premiums. Also, with respect to wholesale drug costs over $40, drug manufacturers would be required to notify specified purchasers within 60 days of increases that exceed a specified percentage.
https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180SB17

A.B. 156. Open enrollment periods for individual plans
Beginning with plan and policy years on or after January 1, 2019, open enrollment for individual health plans offered both outside and through the Covered California marketplace must be at least three months long. For individual health plans offered outside Covered CA, the open enrollment period will extend from October 15th of the preceding calendar year to January 15th of the benefit year. For those health plans offered through Covered CA, the annual open enrollment period will run from November 1st to December 15th of the prior calendar year, with two special enrollment periods that will run immediately prior to and after the open enrollment period, resulting in an October 15th to January 15th total enrollment period.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180AB156

S.B.133. Continuity of care
This legislation applies to plans and policies in the individual market. Under this legislation, certain patients who are newly covered or enrolled may be able to arrange for the completion of covered services by a nonparticipating provider for one of any specified conditions if, at the time their coverage became effective, they were receiving services from that nonparticipating provider for that condition and their prior coverage had been discontinued in the market.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180SB133

S.B. 223. Health care language assistance services
This law is applicable to health insurers and health care service plans, and extends the availability of language assistance services with respect to vital documents that are not standardized but contain enrollee or insured specific information. Health insurers and health care service plans are already required to notify enrollees or insureds upon initial enrollment as well as in annual renewal materials of the availability of language assistance services in the top 15 languages spoken by limited-English proficient individuals in California, and of certain nondiscrimination protections.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180SB223

New Labor And Employment Laws

S.B. 63. New Parent Leave Act
The New Parent Leave Act extends the state's parental-bonding leave requirements, which currently apply only to employers with 50 or more employees, generally to all California employers that have between 20 and 49 employees. An employee that wishes to take leave under the act must request and take the leave within the first year after:

  • The birth of the employee's child;
  • The employee's adoption of a child; or
  • The placement of a child for foster care with the employee.

The act also provides protections against retaliation, addresses when both parents work for the same employer, and that employers must maintain and pay for group plan benefits during the employee's leave.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180SB63

S.B. 731. Public school employees new leave entitlement for illness or injury
Public school certificated and classified employees who are former active duty members of the Armed Forces, or the California National Guard, are entitled to a leave of absence for an illness or injury with pay for medical treatment for a military service-connected disability. The entitlement is 10 days for a certificated employee and 12 days for a classified employee. The law also requires a leave credit for the employee on the date of his or her disability rating decision.
https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180SB731

A.B. 1710. Prohibited discrimination against service members
This legislation amends existing law prohibiting various types of discrimination against an officer or enlisted member of the military or naval forces of the state or the United States because of his or her membership or service. The amendments prohibit discrimination in terms, conditions, or privileges of employment and include remedies for violations.
https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180AB1710

A.B. 1008. Employment discrimination: conviction history ("Ban the Box")
The prohibition on a state or local agency from asking an applicant for employment to disclose information regarding his or her criminal conviction is repealed. The law also makes it an unlawful employment practice for an employer with 5 or more employees to include on any job application any question about an applicant's conviction history, or for an employer to inquire or consider an applicant's conviction history until he or she has received a conditional job offer. Notice provisions are also required.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180AB1008

S.B. 396. Antiharassment training
New provisions to the California Fair Employment and Housing Act (FEHA) require employers with 50 or more employees to include, as a component of the already required FEHA training and education for supervisors, training that is inclusive of harassment based on gender identity, gender expression, and sexual orientation. In addition, the new provisions require each employer with 5 or more employees to post a poster developed by the Department of Fair Employment and Housing regarding transgender rights in a prominent and accessible location in the workplace. Under current law, employers must provide at least two hours of prescribed training and education regarding sexual harassment to all supervisory employees within six months of their assumption of a supervisory position and once every two years, as specified, and each employer must post a poster on discrimination in employment, which includes information relating to the illegality of sexual harassment, in a prominent and accessible location in the workplace.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180SB396

S.B. 295. Sexual harassment prevention-farm labor contractors
Existing law regarding farm labor contractor licensure is amended. Currently, one of the licensure requirements is to provide sexual harassment training to all personnel. The new law requires this training to be conducted in or interpreted into the language understood by the employee, and adds an obligation to provide a list of all antiharassment training materials or resources used in the prior calendar year.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180SB295

A.B. 46. Definition of Employer: wage discrimination
California's equal pay law is amended to include both public and private employers in its definition of "employer," but exempting public employers from the misdemeanor enforcement provisions of the law.
https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180AB46

A.B. 168. Restrictions on use of salary information with respect to job applicants,br> All private and public employers are prohibited from relying on an applicant's salary history information in determining whether to offer employment or what salary to offer. The law also prohibits an employer from seeking salary history information about an applicant for employment and requires an employer, upon reasonable request, to provide an applicant with the pay scale for a position. However, the law permits applicants to voluntarily and without prompting disclose salary history information, and does not prohibit an employer from considering or relying on that voluntarily disclosed salary history information in determining salary. The law does not apply to salary history information disclosable to the public pursuant to federal or state law.
https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180AB168

A.B. 1209. Gender pay differential reporting
On or after July 1, 2019, employers with more than 500 employees in California and that are required to file a statement of information with the Secretary of State, will be required to collect specific information on gender wage differentials, and submit that information to the Secretary of State as of July 1, 2020, and biennially thereafter.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180AB1209

S.B. 189. Workers' Compensation: Definition of Employee
The scope of the exception from the definition of an employee under California workers' compensation law has been expanded, generally effective July 1, 2018. The exception applies to an officer or member of the board of directors of a quasi-public or private corporation who owns specified stock of the corporation if that officer's or member's parent, grandparent, sibling, spouse, or child also owns at least a certain percentage of the issued and outstanding stock and that officer or member is covered by a health care service plan or a health insurance policy, and executes a written waiver.
https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180SB189

A.B. 1701. Construction contractor liability
Under this new law, direct construction contractors are required (as defined in the law) to assume, and be liable for, unpaid wages, benefits, or contributions owed by a subcontractor for labor connected to the contract. The law is applicable to certain construction contracts entered into on or after January 1, 2018 and requires that subcontractors provide payroll records upon a direct contractor's request.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180AB1701

S.B. 201. Higher Education Employer-Employee Relations Act
Student-employees of the Regents of the University of California, the Trustees of California State University, as well as the Directors of Hastings College of Law, whose employment is contingent upon their status as students, are considered employees and higher education employees for purposes of the Higher Education Employer-Employee Relations Act. The law also:

  • Grants employees the right to form, join, and participate in the activities of employee organizations of their own choosing for representation on all matters of employer-employee relations and to meet and confer with their employer;
  • Provides that all matters not within the scope of representation are reserved to the employer and are not subject to meeting and conferring;
  • Excludes from the scope of representation, for purposes of the University of California only, among other things, conditions for the award of certificates and degrees to students; and
  • Provides that, for purposes of the University of California only, the requirements for students to achieve satisfactory progress toward their degrees are also outside of the scope of representation.
https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180SB201

A.B. 260 and S.B. 225. Human trafficking
A.B. 260 requires hotels, motels, and bed and breakfast inns, not including personal residences, to post a notice relating to slavery and human trafficking.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180AB260

S.B. 225 requires this notice to clarify that a person can text specified nonprofit organizations for services and support in the elimination of slavery and human trafficking, and revises the names of the nonprofit organizations listed in the notice.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180SB225

A.B. 450. Immigration worksite enforcement
Public and private employers are prohibited from voluntarily consenting to an immigration enforcement agent entering nonpublic areas of a place of labor without a warrant. The law also prohibits an employer, or another acting on the employer's behalf, from voluntarily consenting to an immigration enforcement agent obtaining employee records without a subpoena or court order.
http://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180AB450

S.B. 258. Cleaning Product Right to Know Act of 2017
This legislation applies to manufacturers of certain consumer products, such as air care, automotive, cleaning, polish or floor maintenance products, and employers with these products in the workplace. Under the act, employers that are already required to maintain and provide safety data sheets must also make available information prepared by manufacturers about these consumer products.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180SB258

A.B. 569. Reproductive health
Provisions of California's labor law are amended to prohibit an employer from taking any adverse action against an employee or their family member for their reproductive health decisions, including, but not limited to, the timing thereof, or the use of any drug, device, or medical service.
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180AB569

S.B. 306. Retaliation Actions and Complaints
The Labor Commissioner is authorized to petition a superior court for injunctive relief for violations of employment-related discrimination or retaliation. Employees may also bring a civil action to seek injunctive relief. The law also requires that the court assess legal costs and attorney's fees to the employer when an employee is successful in his or her civil suit.
https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180SB306

For additional information, please contact your Burnham Benefits Consultant or Burnham Benefits at 949-833-2983 or inquiries@burnhambenefits.com.


Burnham Benefits does not engage in the practice of law and this publication should not be construed as the providing of legal advice or a legal opinion of any kind. The consulting advice we provide is intended solely to assist in assessing its compliance with the Patient Protection and Affordable Care Act and other applicable federal and state law requirements, and is based on Burnham Benefit’s interpretation of federal guidance in effect as of the date of this publication. To the best of our knowledge, the information provided herein, and assumptions relied on, are reasonable and accurate as of the date of this publication. Furthermore, to ensure compliance with IRS Circular 230, any tax advice contained in this publication is not intended to be used, and cannot be used, for purposes of (i) avoiding penalties imposed under the United States Internal Revenue Code or (ii) promoting, marketing or recommending to another person any tax-related matter.

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