EP Labor Relations and Legal Newsletter - Winter Edition 2024

Legal Updates:  Prior Legal Alerts 

It is important to Entertainment Partners (EP) that we keep our clients updated with the latest information as it becomes available, highlighting major enacted legislation, “best practice” guidance, and current industry practices.  Please see prior EP alerts we have released since our last newsletter for more information.

Legal Updates:  California 

Prior Alert Regarding Pertinent California Legislative Updates to 2024 Employment Laws

Please be advised of the November 21, 2023 legal alert depicting some of the more pertinent updates in 2024 to California’s employment laws on the topics below:

• California Expands Paid Sick Leave Entitlements 
• Workplace Violence Prevention Plan and Training Required in California 
• Wage Theft Protection Act (WTPA) Notice Expanded to Include Disaster Declaration Notification 
• California Expands Its Ban on Non-Competes
• California Establishes Mandatory Guidelines Relating to the Use of Firearms and Ammunition on Movie Sets
• Trial Court Proceedings No Longer Automatically Stayed While Denial of Motion to Compel Arbitration is Under Approval

California’s Cannabis-Friendly Workplace Law Took Effect January 1, 2024

California’s 2022 Assembly Bill 2188 (here) went into effect on January 1, 2024.  The law amended California’s Fair Employment and Housing Act by declaring:  “[i]t is unlawful for an employer to discriminate against a person in hiring, termination, or any term or condition of employment, or otherwise penalizing a person … [for] use of cannabis off the job and away from the workplace … [or for] employer-required drug screening test that has found the person to have nonpsychoactive cannabis metabolites in their hair, blood, urine, or other bodily fluids.”  That same law does not allow an employee to possess, be impaired by, or use cannabis on the job.  While possession and use are relatively easy to establish, proving an employee is “impaired by” cannabis when there is no direct evidence of possession or use will likely be a subject of much litigation under this law.  

In October of 2023, California passed an amendment to this law in SB 700 (here), which also takes effect on January 1, 2024, adding two extra prohibitions.  First, an employer cannot request information from a job applicant relating to the applicant’s prior use of cannabis.  Second, unless state or federal law requires otherwise, an employer cannot use information about a person’s prior cannabis use obtained from the person’s criminal history as a basis to discriminate against that person in hiring, termination, or any other term or condition of employment.

California Enacts Reproductive Loss Leave

Starting January 1, 2024, California law requires covered employers (i.e., five or more employees) to grant eligible employee’s request for up to five (5) days of leave following a reproductive loss event for covered employees (i.e., those who have worked for the employer for at least 30 days).  A reproductive loss event is defined as “the day or, for a multiple-day event, the final day of a failed adoption, failed surrogacy, miscarriage, stillbirth, or an unsuccessful assisted reproduction.”  The amount of reproductive loss leave is limited to a maximum of 20 days within any 12-month period for those experiencing multiple reproductive loss events in a year.   California’s reproductive loss leave is unpaid, unless the employer has an existing policy that requires such leave to be paid.   No documentary evidence is required for the employee to substantiate the need for leave.   California’s new reproductive loss leave law can be found here.

California Employers Now Presumed to Have Retaliated In Violation of the Labor Code if Adverse Employment Action Takes Place Within 90 Days of Protected Activity

Starting January 1, 2024, if an employer takes an adverse employment action against an employee who engaged in protected activity under the Labor Code within 90 days of the adverse employment action, then a California court will impose a rebuttable presumption that the employer engaged in retaliation against this employee, which the employer will then bear the burden of rebutting.  This new law will require employers to be mindful when handling certain personnel decisions (i.e., terminations, demotions, diminished responsibilities, etc.) and ensure the employer has documentary evidence to substantiate that the adverse employment action has nothing to do with the protected activity.  A copy of this new law can be found here.

Legal Updates:  New York 

New York State Expands Restrictions on Release Agreements for Discrimination and Harassment Claims

New York Governor Kathy Hochul on November 17, 2023 signed into law Senate Bill 4516 (the “Bill”), which took effect immediately. Among other things, starting on November 17, 2023 for settlements relating to discrimination, harassment, or retaliation, the Bill (1) requires employers to revise common confidentiality provisions and (2) prevents employers from including certain provisions, including liquidated damages clauses. Specifically, an employer may not (absent employee consent) include a confidentiality provision in a release agreement for a claim of harassment and retaliation. The Bill also renders unenforceable any clause that would penalize the covered employee for violation of the agreement’s non-disclosure or non-disparagement clause with either a liquidated damages penalty or forfeiture of the consideration paid to the employee in exchange for entering into the release agreement.  The Bill applies these requirements also to applicants and independent contractors. New York employers should work closely with their lawyers to review and potentially revise any agreement templates that involve a confidentiality provision for harassment and retaliation claims.  

New York City Requires Employee Bill of Rights

By July 1, 2024, covered employers (those employing workers who perform work within New York City) must provide a copy of the Employee Bill of Rights (“bill of rights”) to each current employee in New York City and provide the bill of rights to each new covered employee on or before the employee’s first day of work.  This law also carries a posting requirement, which requires that covered employers must post the bill of rights in an area that is accessible and visible to employees and it also must (additionally) be posted on the employer’s website for employers that use a website or mobile application to regularly communicate with employees.  Covered employers who fail to comply with this new requirement will incur a $500 penalty, while also being afforded a 30-day window to cure the violation following the first complaint made against the employer. 

Legal Updates:  Federal/Global

Proposed Federal Regulations on the Horizon to Raise Minimum Salary for Exempt Status

Last fall, the Department of Labor (DOL) released proposed regulations to increase the minimum salary required for salaried exempt status treatment of executive, administrative, and professional (including artistic) professionals.  Final regulations are expected in 2024.  If adopted in current form, the required weekly minimum salary would rise from $684 per week ($35,568 annualized) to $1,059 per week ($55,068 annualized).  The special exempt minimum daily rate for exempt employees in the motion picture production industry as an exception to the general requirement of a minimum weekly salary likewise would increase from a daily minimum of $173.83 per day (1/6 of $1,043 weekly minimum pay) to $269.50 per day (1/6 of $1,617 weekly minimum pay).  The $269.50 federal daily minimum for those employers choosing to pay a daily rate instead of standard weekly minimum salary to their exempts would exceed the daily equivalent in even the highest minimum salary states like California and New York.  The DOL also included automatic three-year increases of the minimum weekly (and motion picture production industry daily) salary rate to maintain alignment with the 35th percentile for full-time non-hourly workers in the lowest wage Census region.

EU Finalizes Artificial Intelligence Act

On December 8, 2023, the European Parliament and Council reached a political agreement on the European Union’s Artificial Intelligence Act (“EU AI Act”), which – when ratified – will create a comprehensive legal framework for the regulation of AI systems across the EU. The EU AI Act prominently features a risk-based approach, defining four different risk classes, and imposes specific obligations on providers/users that include testing, documentation, transparency, and notification duties.  With political agreement reached, the EU AI Act will shortly be officially adopted by the EU Parliament and Council and published in the EU’s Official Journal sometime in early 2024.  A majority of the EU AI Act’s provisions will be enforced after a two-year grace period that will likely commence in 2026. 

Legal Updates:  Multi-State

Continued Expansion of Sick and Paid Time Off Laws Across the Country

For years, companies have maintained paid sick and vacation time-off programs for their regular full-time middle/high wage workforces in order to stay competitive in attracting these employees.  Low wage or temporary/freelance workers, however, have historically been excluded from this benefit.  Since there is no federal sick or other paid time off law, various states and localities have enacted a patchwork of legislation in pockets of the country.  While San Francisco was the first city in 2006 and Connecticut the first state in 2012 to pass paid sick time laws, those numbers have now increased to the double digits.  Some states like Maine, Nevada and Illinois have more recently adopted paid time off usable for any reason (essentially vacation) as opposed to specific illness and safety circumstances.  We also are now seeing jurisdictions that passed earlier sick leave laws modifying their laws to maintain parity with these newer and more generous entitlements.  Though there are commonalities among the individual sick and paid time-off laws, there are differences that employers operating in multiple jurisdictions need to be mindful of for cost and compliance, such as employer coverage, employee eligibility requirements, amounts of leave, accrual caps, and whether unused hours carry-over.  Employers should be mindful of each jurisdiction’s legal requirements (or lack thereof).  

New Requirement to Provide PTO Leave in Illinois

Effective January 1, 2024, employees in Illinois can earn and use up to 40 hours of paid leave during each year. The new Illinois law applies to any employer with employees in the state. Illinois’ law is not sick leave, but instead is PTO that can be used for any reason.  Employees performing any amount of work within the state are covered. A collective bargaining agreement can explicitly waive application of the law.  Employees accrue one hour of paid leave for every 40 hours worked and can accrue and use a maximum of 40 paid leave hours in a year. Although PTO hours start to accrue on January 1, 2024, or the time of hire, whichever is later, there is a 90-day waiting period before employees can use it. Unused hours must be carried over from year-to-year, up to a maximum of 80 hours according to current “proposed” regulations.  Unused hours do not need to be paid out upon separation of employment unless the employer supplants its existing paid vacation leave policy with this PTO balance (in which case, it must be paid out upon end of employment similar to payout of unused vacation leave).   The employer can also choose to frontload the 40 hours at the start of each year instead of using the accrual method. A poster explaining employees’ rights to paid leave must be posted at the worksite, and a model poster is available by the state. The proposed regulations also require printing the available PTO balance on paystubs. The text of the law, “proposed” regulations, required poster, and FAQs are available here.

Big Changes to Chicago’s Paid Sick Leave (Cook County Too, But Not As Much)

Faced with the new Illinois PTO law going into effect on January 1, 2024, Chicago passed massive changes to its paid sick leave ordinance on November 9, 2023 (here), which take effect on July 1, 2024 (here).  For large employers (101 or more employees), the biggest change is that employers must provide PTO leave in addition to paid sick leave, and unused PTO must be paid out upon the end of employment.  Employees in Chicago will accrue one hour of PTO and one separate hour of paid sick leave for every 35 hours worked in the city.  Waiting time periods apply. Unused sick leave is carried over year to year up to a max of 80 hours, but only 16 hours of unused PTO is carried over yearly.  A collective-bargaining agreement may explicitly waive application of the law. Paystubs must include the available, accrued, and used balances for both types of leave, and employers must maintain a written policy for both types of leave that must be given at the start of employment and five days before any change to the policy.  A poster created by the city must also be posted at the worksite and provided with the employee’s first paycheck and annually with a paycheck issued within 30 days of July 1st of each year.    

Cook County had an existing paid sick leave law that expired December 31, 2023, when its new PTO leave ordinance took effect.  Although the ordinance took effect on December 31, 2023, enforcement of the ordinance will start on February 1, 2024.  Cook County’s version of the law is similar to the new Illinois PTO law, and thus does not have the payout upon termination requirement like Chicago.  See the Cook County Commission on Human Right’s website for more information (here).  

Paid Sick & Safety Leave in Minnesota and Bloomington, MN

Effective January 1, 2024, employers with at least one employee in Minnesota must allow in-state employees to accrue one paid sick and safe time leave (“SST”) hour for every 30 hours worked up to a maximum of 48 hours in each year, which can be carried over from year-to-year up to 80 hours.  Unused hours do not need to be paid out at the end of employment, but they must be reinstated if the employee is rehired within 180 days of separation.  The paystub must include the total number of SST hours accrued and used during the pay period.  The state created a notice of rights which must be provided to employees by (a) posting a copy at the worksite, (b) providing each employee a copy directly, or (c) posting it in a conspicuous place on an online platform through which the employees perform work.    The bill is available here (specifically in Articles 12 and 13) and the FAQs and required notice are available here.

Bloomington, Minnesota’s SST ordinance took effect on July 1, 2023; similar to the new state law, Bloomington’s ordinance applies to employers with a single employee and SST leave can now be used as soon as it is accrued.  The law also requires the paystub to include the balance of SST hours accrued and available and the total number of SST hours used.  The text of the Bloomington amended ordinance is available here and the FAQs and model poster are available here.    

Minimum Wage Updates

Click here to see the latest Minimum Wage Chart.

LABOR RELATIONS KEY UPDATES

Click here to see the chart of updates to Collective Bargaining Agreements.

EP LEGAL AND LABOR RELATIONS CONTACTS

• Joseph Scudiero (Senior Vice President & Chief Labor Counsel):  jscudiero@ep.com

• Bob Pucher (Vice President, Labor Relations):  rpucher@ep.com

• Scott Bishop (Vice President, Employment Law):  sbishop@ep.com

• Ed Pak (Vice President, Lead Technology & Privacy Counsel):  epak@ep.com

• Alan Wu (Director, Employment & Labor Relations Counsel):  awu@ep.com

• Pantea Lili Ahmadi (Director, Corporate & Employment Law Counsel):  pahmadi@ep.com

• Lydiann Betzer (Labor Relations Senior Manager):  lbetzer@ep.com

• Jade Nguyen (Privacy Manager): jnguyen@ep.com

• Melissa Antuono (Staff Labor Relations Specialist):  mantuono@ep.com