The 7 new 2020 laws in California

By Jessica Suotmaa 0

If you’re a business owner with employees, it is time to familiarize yourself with these seven new employment-related laws that went into affect on January 1, 2020. Ensure you follow best hiring practices and follow these laws for existing employees.

1. New minimum wage

California has a new minimum wage. If your business employees 25 or less people, the new minimum wage is $12/hour. Otherwise the new minimum wage is $13/hr.

2. Independent contractors

We wrote about the AB-5 law previously, but it is still worth revisiting if you’re hiring freelance workers and treating them like independent contractors. The new law dictates that if a business controls and directs the work of the worker, and the work is an integral part of the business (think, a gig economy driver working for a ride service company), then they cannot be characterized as an independent contractor. Instead, the business has to treat them as an employee.

3. Sexual Harassment Training

If your business has more than five employees, you are required to provide sexual harassment training to all employees every two years.  SB 1343 also requires employers to provide new employees sexual harassment training within six months of being hired.

4. Lactation Accommodation

California already requires businesses to provide nursing mothers time to nurse or pump, but with the passing of SB142, businesses must ensure nursing mothers have a proper place to do so. A restroom or break room is insufficient. The location must be close to the employee’s work station, must have electrical outlets, and must be private.

5. Arbitration Agreements

An arbitration agreement is a contract whereby an employee and employer agree that certain, if not all, disputes will be settled via arbitration outside the court (rather than in court with a lawsuit). Companies can no longer force employees into mandatory arbitration agreements with the passing of AB51. This law does not apply to arbitration agreements entered into prior to January 1, 2020.

6. Paid Family Leave

With SB 83, the benefits under paid family leave increase from six weeks to eight weeks. New parents will have more time to stay home with their children starting July 1, 2020.

7. Hair Discrimination

California has banned discrimination based on natural hair style or texture with the passing of SB 188, also known as the Crown Law. Employers and schools cannot discriminate against potential incumbents based on their natural hair, or require a certain hairstyle instead of their natural hair.

 

Do you have questions or concerns as a business-owner and employer? Call an experienced business and employment attorney today! 

AB 5 independent contractor

By Lum Law Group 0

 

AB 5 and the Independent Contractor

In December 2019, the Governor of California, Gavin Newsom, signed into law Assembly Bill 5, which drastically changes how most businesses classify independent contractors.  A worker is more likely to be classified as an employee instead of an independent contractor. Although the impetus for this law was to give more employment benefits to ride sharing, delivery, and “gig economy” workers, its impact is much more far reaching.  The law codifies a California Supreme Court decision, Dynamex Operations West v. Superior Court of Los Angeles (Dynamex) and alters the application of a 20 year old law.

In essence, there is now a 3-part test to determine if a worker is an employee or an independent contractor (the “ABC test”):  

(A) The hiring entity does not control or direct the performance of work;

(B) The person performs work outside the usual course of the hiring entity’s business; and

(C) The person is customarily engaged in an independently established trade, occupation or business.

If all these 3 conditions are met, a worker may be classified as an independent contractor.  If not, the worker is an employee. Some exceptions have been made to the application of this new law, mostly for licensed professionals, such as doctors, lawyers, real estate professionals, broker dealers, etc.  As stated, although this was intended to target the above mentioned workers, many businesses that have hired independent contractors to do part time work, such as bookkeepers, free lance journalists, etc., would be forced to classify these individuals as employees even though they do not solely work for the business.  The law is new and vague, and there are already legal challenges being raised and amendments and other changes being proposed, but for now employers, especially small businesses, must be even more careful of their hiring practices while the law is interpreted and its parameters are (hopefully) defined in more detail.

See The Daily Recorder – https://www.law.com/therecorder/2019/09/19/ab-5-changing-the-landscape-for-independent-contractor-analysis/?slreturn=20200109121407

Immigration and the Internet

By Lum Law Group 0

Immigration and the Internet

We live in interesting times. Our current government appears to be stressing preventing people from abusing our immigration system over helping people to legitimately immigrate, or even visit. As such, people planning on coming to the United States, and visitors and green card holders here in the United States must be aware of their presence on the Internet.

In the latest news, several news outlets are reporting that Immigration and Customs Enforcement of the Department of Homeland Security has purchased marketing information in order to locate phone numbers and individuals whom it suspects are out of status. Here are a few of those reports:

https://www.wsj.com/articles/federal-agencies-use-cellphone-location-data-for-immigration-enforcement-11581078600

https://www.vox.com/recode/2020/2/7/21127911/ice-border-cellphone-data-tracking-department-homeland-security-immigration

Of course, those individuals here should follow U.S. laws regarding immigrant and visitor status. Here at Lum Law Group, with our over 50 years experience, we are doing our best to help individuals and companies here and abroad navigate these waters in these turbulent times to insure they are compliant with the current laws, and to understand their alternatives based on each individual’s circumstances, whether that arises in a family or business setting.

Instagram and Fair Use

By Lum Law Group 0

In my last blog I talked a little about copyrights and the First Sale Doctrine.  In this blog, I’d like to go back to Copyrights to discuss Copyright law and the Fair Use Doctrine.

Here is the situation:  Instagram, with over 1 billion monthly uses, has become a common place for individuals and companies to post original stories, pictures, and short videos about the life and business.  Let’s use a video as an example. What is the copyright protection to the creator of the video from Instagram? From other users who see the material? Let’s use a video as an example. What if another user reposts the original post?  Reposts the photo to critique? Uses the video outside of Instagram?

Under copyright law, the creator, unless he assigns his rights to someone else, or creates the video as an employee or “work for hire”, is the copyright owner.  But what happens when he posts that video on Instagram? Well first, under Instagram’s terms of service, Instagram receives a lifetime royalty free license for the video.  Thus if a user merely shares the original post, there will not be any copyright infringement by the user.

What if a user takes a portion of the video and puts it in a new post, with commentary about the video, for the purpose of critiquing it?  Under the Fair Use doctrine in copyright law (17 USC § 107), use “for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright.”  Thus, a review of the video would not create an infringement. The idea being that the fair use is designed to give the public some information about that video. This is a clear example of “fair use.”

But what if the video is taken down and then a portion of it is reposted on some other medium? Or a portion of it is taken and reposted on another medium for other purposes, or “repurposed” for comparison to a competitor’s goods?   Well, in such situations, the “Fair Use doctrine” may not be so clear. If the use is clearly for commercial purposes, if there is some gain the person using the video, or part of it, then as you might expect, such a usage would probably be found to be infringing.

So, when seeing material on Instagram, unless sharing other’s posts, limit any uses of other’s materials for a specific purpose as outlined in “Fair Use Principles” above, or better yet, consult an attorney before you consider reposting anyone else’s materials.

Does your business act like a business?

By Jessica Suotmaa 0

Don’t say we didn’t warn you, but the implementation of new tax regulations may cause many business owners to lose their business deductions when their “business” is reduced to a mere hobby.  Budding entrepreneurs need to ensure their business is set up correctly. Meanwhile, existing business owners need take a magnifying glass to their business to ensure their businesses are both set up and run like a business. In this article we’ll outline the basics of what it means to own a business that’s correctly set up as a business, as well as what it means to act like a business.

1. Form a business entity

It’s more challenging to prove your small business isn’t a hobby if it’s not registered as it’s own entity.  Hire a professional to determine which business type would be most suitable before registering with your local government.

2. Create a professional website

Whatever your business may be, a professional website will help validate it for your customers.

3. Open a separate business account

Keeping your business and personal expenses separate will simplify your year-end bookkeeping—especially come tax time. Open a business bank account and credit line to ensure they’re separate.

4. Open a business email at a professional domain

Many of our clients already have separate business emails but at the same email server as their personal email.  To solidify your professional business image, and to ensure it’s security, open a new email account with a professional domain, such as your own company’s dot com.

5. Draft written contracts

Don’t allow your clients to weasel out of contracts or make last minute changes. Hold them accountable by drafting written contracts and requiring your clients to sign them prior to beginning work.

6. Provide invoices

After you’ve completed work, always invoice your clients, and ensure that the invoices match incoming payments.

7. Advertise your product or services

Even if you rely on word-of-mouth to obtain new customers, try listing your business with a business registry if advertising is out of your budget.  The purpose is to prove that your running your business with the intention making a profit, and advertising your product or services plays a large part in it.

In order to “act like a business” and deduct relates business expenses on your taxes, even the smallest side business must follow the above rules.  If you’re still a freelancer thinking about expanding to a full-fledged business, or want to be treated (taxes) as a business, then start right from the beginning and follow our tips to avoid issues years down the line.