California Gov. Gavin Newsom on Friday signed a “Right to Return” bill that requires hotel, event center, airport hospitality and janitorial employers to first rehire workers laid off during the pandemic when jobs become available.
California Senate Bill 93 takes effect immediately, but one employment lawyer foresees some restaurants and other hospitality employers struggling with the bill’s requirements.
Alden Parker, co-chair of Fisher Phillips’ Hospitality practice group in Sacramento, Calif., and regional managing partner for the firm, in a phone interview said the bill will not sunset until Dec. 31, 2024, and erects hurdles for staffing and adds penalties of as much as $600 a day per employee for failure to comply with the law.
While stand-alone restaurants are not addressed in the new regulations, SB 93 would impact any restaurants or bars that are connected, such as through contracts or leases, to an event center, hotel, private clubs or airport. The bill requires each laid-off employee be giving five business days to reject an offer when the jobs come available.
To qualify, workers had to have been employed for more than six months in the 12 months preceding Jan. 1, 2020, and had to have been laid off for non-disciplinary reasons related to the COVID-19 pandemic.
But the legislation poses challenges for hospitality employers, Parker said.
“It seems awfully unfair to those employers to keep them on the hook to potentially add people all the way through Dec. 31, 2024, and have to track those that were laid off during this time,” Parker said. “That's certainly a concern of having to go through the mechanics each and every time.”
Parker added that “it just seems like we're overcorrecting for an issue that I actually think the economy is going to solve on its on its own.”
But the penalties for violations are stiff, Parker said.
“There’s a penalty of $100 for each employee who wasn't provided with this opportunity, and it's $100 per employee per day,” he said. “There is also a potential liquidated damages provision of $500 per employee for each day for the employees to prove that their rights were violated under this act.
Currently, the penalties are to be levied by the California labor commissioner, he said.
“I think employers are going to feel compelled to go ahead and offer these jobs over and over again simply to try and avoid the risk,” Parker said, “And the issue here is that it's going to slow down rehiring and add to longer periods of unemployment.”
Newsom had earlier rejected a similar bill, saying it was too onerous.
“As we progress toward fully reopening our economy, it is important we maintain our focus on equity,” Newsom said in a statement Friday. “SB 93 keeps us moving in the right direction by assuring hospitality and other workers displaced by the pandemic are prioritized to return to their workplace.”
The Service Employees International Union California told the Los Angeles Times that the new law will benefit workers who are predominantly women and people of color by ensuring they are “first in line when their jobs come back as businesses reopen and that they can’t be retaliated against or passed up for younger employees.”
A number of local California communities had already approved “Right of Recall” protections, including Santa Monica, the city and county of Los Angeles, Pasadena, Glendale and Long Beach.
Contact Ron Ruggless at Ronald.Ruggless@informa.com
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