Legal Concerns Due to COVID-19 in California





Employers should prepare for an increase in litigation and proceed with diligent attention to compliance with employment practices required prior to the COVID-19 pandemic and new requirements arising out of the pandemic. Following is a review of some of those practices.

Exempt Employee Pay and Status Requirements

In response to the pandemic, many employers furloughed and laid off employees. A practice employed by some employers has been to ask exempt employees to work reduced schedules (e.g., working every other week, working less days each week, working less hours each day).

Work During Time Off

In some instances, exempt employees are asked to perform some work during time off. In other instances, employees unilaterally decide to perform some work during time off to ensure responsibilities are met without interruption. Employers must be mindful of the requirement that an exempt employee receive a full week of pay if the employee works any part of a work week – any part at all! A failure to provide timely payment can also result in penalties, and they can add up quickly! Thus, it is vital to ensure that no work is performed by an exempt employee in a work week during which the employee is supposed to be on furlough. Employees should be aware that working while furloughed can also impact unemployment benefits.

Reduced Salaries

With less or no revenue for months, some employers may have reduced or considered reducing the salaries of exempt workers. It is essential that the salaries of these workers continue to meet the minimum required thresholds, however, for an employer to continue to classify and treat these employees as exempt.

Exempt Job Duties

Another common practice undertaken by employers during the pandemic has been to expand the job duties of exempt employees to ensure work typically performed by workers who were furloughed or laid off still gets done. Employers should be reminded of job duty tests that must be met for exempt employees to be classified as exempt (e.g., more than 50 percent of the employee’s time must be spent performing exempt duties). It is important that employers ensure that modified and/or additional duties do not reduce the overall duties to be performed by the employee below the “more than 50%” threshold, for this could jeopardize the employee’s exempt status. In addition, as a result of an employer laying off or furloughing employees, individuals classified as exempt under the executive exemption may no longer be customarily and regularly directing the work of two or more other employees. Changes may be required and those employees may need to be reclassified and treated as nonexempt employees.

Overtime Calculations – Hazard Pay, Bonuses and Incremental Pay Increases

Some employers have provided nonexempt employees with hazard pay, bonuses or incremental pay increases to reward workers reporting to work during the pandemic. It is important for employers to consider the implications these pay increases might have with respect to overtime pay, as various forms of additional pay that may be provided to a nonexempt employee must be included in the calculation of any overtime pay.

Remote Work

Stay-at-home orders forced many employers seeking to continue operations to rework how their employees work. Many employees are now working from home. The fact that an employee is working from home does not change an employer’s responsibilities to comply with employment laws, including laws relating to wages, proper record maintenance, workers’ compensation coverage and other required benefits.

Employers must also comply with local ordinances that cover individuals performing work within certain geographic parameters. For example, employees working from home may be entitled to higher hourly wages and increased paid sick leave as a result of their home being located within an area covered by a city ordinance. Failure to provide wages in compliance with these ordinances could lead to claims for unpaid wages, penalties and more.

Employers must also be certain to reimburse employees for expenses incurred in the performance of work at home. California Labor Code Section 2802 requires that an employer indemnify an employee “for all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties…”

Employees must also comply with notice requirements applicable to remote workers.

Documentation and Recordkeeping Requirements

With new laws come new requirements related to documentation and maintenance of records. It’s important to know what documents are required, which documents must be provided, which ones cannot be requested and for how long records must be kept.

COVID-19 Screening

To prevent the spread of the Coronavirus, employers are screening employees for COVID-19 symptoms prior to employees entering the worksite. Employers should be aware that time spent by employees awaiting screening and during the screening should be treated as compensable time. Claims for unpaid work time and penalties could be just around the corner! The likelihood of claims being filed under the Private Attorneys General Act (PAGA) through which an employee can file claims on behalf of other employees significantly increases the risks of noncompliance, too.


Employers must also be aware of the potential for claims of discrimination. Although COVID-19 is not necessarily a covered disability because it is transitory in nature, an employer could still be held liable for discrimination if it fails to engage in the interactive process required by laws enacted to prevent disability discrimination. Employers must not overlook this obligation. The law leaves no room for automatic assumptions or denials.

Age, race and gender discrimination claims may also be filed by individuals who have lost employment.

Workers’ Compensation, Negligence, Gross Negligence, Retaliation, Wrongful Termination and More

Employers should also be attentive to preventing other potential claims, including:

  • workers’ compensation claims if employees become infected with COVID-19;
  • claims alleging negligence of gross negligence, and failure to take necessary steps to protect employees and customers from exposure to COVID-19; and
  • claims of retaliation and wrongful termination by employees who refuse to report to work because of fear of exposure to COVID-19 at the workplace.

The List Goes on . . . So, Buckle Up your Legal Seatbelt

The Road to the Courthouse is Winding and It’s Getting More and More Crowded!

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