California is one of the most worker-friendly states in the nation. So it isn’t surprising that employers gripe about the state’s employee-protection laws.

But business boosters say the real problem with the laws isn’t their intent. It’s that there are so many regulations and some are so rigid and confounding that they’re hard to make sense of, even for companies that want to follow the rules.

“It’s an administrative burden, it is a lack of flexibility in the workplace and it is also such stringent requirements that there’s always a degree of liability or a threat of litigation,” said Jennifer Barrera, a policy advocate with the California Chamber of Commerce.

There is, of course, a flip side.


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Regulations can prevent tragedies and injustices. In Texas, a state often praised for being “business friendly,” a lack of rules has left hundreds of thousands of workers without coverage should they be injured or killed on the job.

Such worker-protection laws often follow abuses, and labor advocates say legislative mandates and harsh penalties are necessary to protect the most vulnerable workers and to ensure bad actors make improvements.

Every year, California legislators wanting to end abuses write more laws.

The state Chamber of Commerce recently listed more than two dozen new state employment laws or amendments that will go into effect by or in 2015.

But all those new laws and the myriad others that have been on the books for decades have a flip side of their own. Together, they continue to fluster business owners and human resources workers trying to keep up with legal nuances and court rulings that could change their meaning.

Here’s a short-list of regulations that are either unique to California or come with steeper requirements here.

• Most states don’t allow workers to collect overtime until they exceed 40 hours of work in a single week. In California, workers are entitled to it if they work more than eight hours in a single day.

This law prohibits companies from allowing an employee to stay late one day and come in later the next day, or working long hours if a crisis comes up without additional pay.

This regulation can also fluster workers who may want to leave early for an appointment or work long hours one day to free themselves up the following day, said Jennifer Jacobus of the San Diego Employers Association, a nonprofit human resources consulting group for employers.

“There’s not a lot of flexibility,” Jacobus said.

Barrera said state Republican lawmakers have consistently introduced bills to change this rule only to have them killed early in the process.

• Federal standards exempt many higher-level workers from receiving overtime. California’s standards are more complex.

The federal rules consist of multiple categories of workers. Those who can qualify for exemption from overtime must make at least $455 a week. In California, employees must make twice the state minimum wage to be eligible. That equates to $720 a week.

The standard’s even steeper for computer and software workers. The required salary is tied to inflation, meaning it rises annually. Now these kinds of employees must make at least $1,600 a week, or more than $84,000 a year, to qualify.

Whether someone falls into a particular category is often subject to interpretation and employees can sue if they believe they’ve been misclassified.

• The state requires that companies allow workers to take a paid 30-minute meal break for every five hours of work and a paid 10-minute rest period for every four hours worked.

Mark Saxon, a San Diego attorney who represents businesses in employment law cases, estimated there have been thousands of class action cases over these issues.

A 2012 state Supreme Court ruling clarified that employers aren’t required to relieve workers of all duties during those breaks but the state law remains more stringent than most in other states.

And in some instances, both employers and employees can feel reined in by it.

“An employee comes to you and says, ‘I’d rather take a longer lunch and skip my rest periods,'” Jacobus said. “Employers are frustrated they have to say no.”

• California’s $9 an hour minimum wage exceeds the U.S. rate of $7.25 an hour, and the state’s minimum wage scheduled to increase to $10 an hour in 2016. San Diego voters also are set to decide that year whether to gradually increase the city’s minimum wage to $11.50 an hour.

• The state’s Private Attorney General Act allows workers alleging labor violations to file suits seeking civil penalties for offenses that may involve multiple employees rather than rely on a state agency to do so.

• California has more stringent reporting requirements in advance of layoffs. The federal mandate requires companies with more than 100 full-time workers to notify workers 60 days before major closings and large-scale layoffs. The comparable California law applies to companies with 75 or more full-time or part-time workers.

• Almost all California companies will be required to provide workers at least three paid sick days a year thanks to new legislation authored by Assemblywoman Lorena Gonzalez of San Diego and signed by Gov. Jerry Brown this summer. Sick leave is not required under federal law.

• California mostly bans non-compete clauses, making it far easier for workers to start new companies and move to other ones and share the expertise they’ve gained with a previous employer.

Orly Lobel, a labor and employment law professor at the University of San Diego, argues this pro-employee law has contributed to success of serial software and biotechnology entrepreneurs in Silicon Valley and San Diego alike.

“That prohibition against non-competes has actually invigorated the economy,” she said.

This is part of our quest digging into the difficulties – real or perceived – of doing business in San Diego. Check out the previous story in our series, For City Subsidies, it Takes Money to Get Money, and the next, Businesses Are in the Dark on New Lighting Rules.

    This article relates to: Business, Economy, Government, News, Quest, Quest: Business Climate, Share

    Written by Lisa Halverstadt

    Lisa Halverstadt is a reporter at Voice of San Diego. Know of something she should check out? You can contact her directly at lisa@vosd.org or 619.325.0528.

    5 comments
    Gregory Hay
    Gregory Hay subscriber

    Is this a complete one-sided love letter to conservatives/libertarians or what?


    Wait… didn't I just read somewhere that the chairman of the Voice of San Diego, R. B. Woolley, is stridently anti-union? Ah… now this kind of article makes sense.

    Bill Bradshaw
    Bill Bradshaw subscribermember

    “Every year, California legislators wanting to mend abuses write more laws”.  That pretty well sums up the problem, but “abuses’ are often anecdotal, not systemic, so they write a law that may cure a problem that occurs, if at all, only occasionally, and the effect is to inject more rigidity into a system that’s already too inflexible for today's workers and work requirements.  The overtime after 8 hours provision is typical, a throwback to assembly line industries.

    The impacts are myriad.  Each new regulation has an enforcement component (translation: more jobs at the state government level and a bigger state budget).  There is seldom any attempt to review existing regulations to check for overlap and conflict, or to eliminate archaic rules that hinder flexible work arrangements.  The rigid “rest periods” and lack of provisions to take time off one day for personal business and make it up the next are typical.  

    The whole system needs a thorough review with an eye to accommodating today’s work schedules, particularly with so many more working mothers.  This state is governed by morons with no future vision, beholden to large labor organizations rooted in the anti-boss, "get what you can" mindset of the 30s.

    Great article Lisa, on a subject that’s really important to the long term competitiveness of California companies.

    Chris Brewster
    Chris Brewster subscribermember

    Interesting to see the San Diego Employers Association raise concerns on behalf of employees. The rule upon which Ms. Jacobus comments would also seem to prevent employers from adjusting schedules to four hours one day and 12 hours the next, while avoiding overtime, one would imagine.

    Chris Brewster
    Chris Brewster subscribermember

    Ms. Halverstadt: Regarding the overtime over 8 hours rule, this is actually a bit more flexible or at least has more nuance. It is possible to create alternative workweek schedules, such as four ten hour day workweeks or even 12 hour workdays. Overtime does kick in for work beyond the scheduled shift.

    https://www.dir.ca.gov/t8/11040.html

    Jafa
    Jafa subscriber

    Fluster? Look it up.