The City of Los Angeles has enacted an ordinance that will require large employers in the retail sector to follow certain scheduling practices. The ordinance takes effect April 1, 2023.
The Details
Covered Employers
To be covered by the ordinance, an employer must be identified as a retail business in the North American Industry Classification System (NAICS) within the retail trade categories and subcategories 44 through 45, and employ at least 300 employees globally.
Covered Employees
To be covered by the ordinance, an employee must be entitled to the minimum wage under state law and perform at least two hours of work within the geographic boundaries of Los Angeles for a covered employer.
Good Faith Estimate
Before hiring an employee, a covered employer must provide the employee with a written good faith estimate of the employee’s work schedule.
The estimate must notify a new employee of their rights under the ordinance. In the alternative, the employer may provide the new employee with a copy of the poster required by the ordinance (see the Notice and Recordkeeping section below).
Employers must also provide a written good faith estimate of an employee’s work schedule within ten days of an employee's request.
If an employee’s actual work hours substantially deviate from the good faith estimate, an employer must have a documented, legitimate business reason, unknown at the time the estimate was provided, to substantiate the deviation.
Right to Request Schedule Changes
Covered employees have the right to request a preference for certain hours, times or locations of work. An employer may accept or decline the request, provided that the employer notifies the employee in writing of the reason for any denial.
Advance Notice of Schedule
Covered employers must provide written notice of the employees’ work schedule at least 14 calendar days before the start of the work period by any one of the following:
· Post the work schedule in a conspicuous and accessible location where employee notices are customarily posted and visible to all employees; or
· Transmit the work schedule by electronic means or another manner reasonably determined to provide actual notice to each employee.
Changes to the Work Schedule
Covered employers must provide written notice of any employer-initiated changes to the work schedule that occur after the advance notice required. An employee has a right to decline any hours, shifts or work location changes not included in the work schedule. If an employee voluntarily consents to work hours or shift changes not included in the work schedule, the consent must be in writing.
Right to Additional Hours
Before hiring a new employee or using a contractor, temporary service or staffing agency to perform work, the employer must first offer the work to current employees if:
· One or more of the current employees is qualified to do the work as reasonably determined by the employer; and
· The additional work hours would not result in the payment of a premium rate under state law.
An employer must make the offer to each current employee either in writing or by posting the offer in a conspicuous location in the workplace where notices to employees are customarily posted. The offer must be made at least 72-hours prior to hiring any new employee, using a contractor, temporary service or staffing agency. Upon receipt of the offer, an employee has 48-hours to accept the offer of additional hours in writing.
An employee who accepts additional hours pursuant to this section isn’t entitled to predictability pay (see below) for those additional hours, if it results in a schedule change from the work schedule.
Predictability Pay
When an employee has agreed to a change in their work schedule after the advance notice period, the employer must compensate the employee with one additional hour of pay at their regular rate for each change to a scheduled date, time or location that:
· Doesn’t result in a loss of time to the employee; or
· Does result in additional work time that exceeds 15 minutes.
An employer must compensate an employee at one-half of their regular rate of pay for the time the employee doesn’t work, if the employer reduces work time listed in the work schedule by at least 15 minutes.
Predictability pay isn’t required if:
· An employee initiates the requested work schedule change.
· An employee accepts a schedule change initiated by an employer due to an absence of another scheduled employee.
· An employee accepts an offer of additional hours as stated above.
· An employee’s hours are reduced due to the employee’s violation of any existing law or of the employer’s lawful policies and procedures.
· The employer’s operations are compromised pursuant to law or force majeure.
· Extra hours worked require the payment of an overtime premium under California Labor Code Section 510.
Rest Between Shifts
Employers are prohibited from scheduling an employee to work a shift that starts less than ten hours from the employee’s last shift without the employee’s written consent. An employer must pay a premium of time and a half for each shift not separated by at least ten hours.
Notice and Recordkeeping
Covered employers must post a notice published each year by the city, informing employees of their rights under the ordinance. Covered employers must post the notice in English, Spanish, Chinese (Cantonese and Mandarin), Hindi, Vietnamese, Tagalog, Korean, Japanese, Thai, Armenian, Russian and Farsi, and any other language spoken by at least five percent of the employees at the workplace or job site.
Covered employers must also retain all records required by the ordinance, for both current and former employees, for a period of three years. These records include:
· Work schedules for all employees;
· Copies of written offers to employees for additional work hours and written responses from employees;
· Written correspondence between the employer and employee regarding work schedule changes including, but not limited to, requests, approvals and denials;
· Good faith estimates of hours provided to new and existing employees; and
· Any other records the city may require to demonstrate compliance with the ordinance.
Retaliation Prohibited
Employers are prohibited from taking adverse action against any employee in retaliation for exercising rights protected under the ordinance. These rights include, but are not limited to, the right to file a complaint or inform any person about any alleged noncompliance with the ordinance; and the right to inform any person of their potential rights under the ordinance and to assist them in asserting such rights.
Next Steps
If you are a covered employer:
· Ensure compliance with the requirements of the ordinance by April 1, 2023.
· Train supervisors on the ordinance.
Please contact your dedicated service professional with any questions.