New California Law Requires Rehiring of Laid-Off Employees in Certain Industries Until 2024!

On April 16, 2021, Governor Newsom signed into law California Labor Code Section 2810.8, which requires employers to offer laid-off or furloughed employees, who were laid off for a COVID-19 related reason, any position that becomes available for which they are qualified. Labor Code Section 2810.8 went into effect immediately. This new law places significant burdens on the employer to offer a position to an employee the employer may not want to bring back, as well as new record-keeping requirements, and carries stiff penalties for those that fail to comply. These new obligations remain in effect until December 31, 2024.

Eligible employees

  • Employee worked for the employer for six or more months in the year before January 1, 2020
  • Employee worked at least two hours per week
  • Whose most recent separation from active employee status with the employer was due to the COVID-19 pandemic, including a public health directive, government shutdown order, lack of business, a reduction in force, or other economic (non-disciplinary) reason associated with COVID-19.

The new bill only applies to certain industries. Even within those industries, it only applies to certain types and sizes of businesses.

Covered Employers

  • Hotels with 50 or more guest rooms
  • Private clubs with 50 or more guest/member lodging rooms
  • Event centers with 50,000 square feet/1,000 seats
  • Airport hospitality (preparation of food or beverages for aircraft crew or passengers)
  • Airport security (security, ticketing, and check-in functions)
  • Janitorial, building maintenance, and/or security services to office, retail, or commercial* buildings (*Note- “commercial” in this context likely includes multi-family residential units with 10 or more units.)

When a new position becomes available, a covered employer must take several steps to offer an eligible laid-off employee (or employees) the position.

Employer Obligations

  • Within five business days of the position being created/ becoming available, the employer must offer the position to any eligible laid-off employee if the employee is qualified for the position. (It is assumed the employee is qualified if they were doing the same or similar position before being laid off.)
  • The offer must be made in writing, which may be hand delivered or sent via U.S. Mail.
  • If the employer has the laid-off employee’s email or phone number, the employer must also make the offer via email and via text message.
  • The laid-off employee or employees have five business days to accept/ decline the position. (Note- if multiple laid-off employees qualify for the position, the employer may offer it to multiple laid-off employees but if multiple individuals accept, the employer must rehire the individual with the longest length of service based on the hire date before the layoff.)
  • If a covered employer does not offer an eligible laid-off employee a position due to the employee not being qualified, the employer must notify the laid-off employee in writing within 30 days of filling the position. The written notice must include:
    • a list of all employees hired for the position
    • their length of service with the employer
    • the employer’s explanation as to why the employer did not rehire the laid-off employee.

In addition to compliance, covered employers must maintain records of their laid-off/ furloughed employees for three years following the date of the employee’s layoff or furlough.

Recordkeeping Requirements

  • Full legal name of the laid-off employee
  • Job title at time of layoff
  • Date of hire
  • Last known physical address
  • Last known email address
  • Last known telephone number (so the employee can be contacted via text)
  • Any written layoff notices
  • All communications between the employer and the laid-off employee regarding employment offers made/ notices provided in compliance with Labor Code 2810.8’s requirements

The consequences for failing to comply with Labor Code Section 2810.8 are severe. If an employer is found to have violated this law, the laid-off employee can recover several types of monetary penalties and damages.

Consequences of Non-Compliance

  • Being forced to rehire/ reinstate the laid-off employee
  • Front and back pay
  • Value of the benefits the employee would have received (i.e., vacation, health insurance, and 401k contributions)
  • Interest on all the above
  • Civil penalties that can be pursued by the Labor Commissioner (then paid to the laid off employee or employees): $100 per affected individual; and $500 per employee per day for each day of violation, until the violation is cured.

In addition to taking all steps required for compliance with Labor Code Section 2810.8, there are several steps employers can take to avoid claims under this section:

Recommendations

  • Implement training for all hiring managers regarding obligations of Labor Code Section 2810.8
  • Prepare a list of all laid-off or furloughed employees by department, organized by seniority of hire date
  • Create a log for all attempts to contact the laid-off employee about a position, and maintain in employee personnel file
  • Develop a template conditional offer letter to laid-off employee(s), including that the hiring decision will be based on seniority
  • Prepare a template letter to send to laid-off employees who are not offered a position based on lack of qualification
  • Develop a written attestation that a laid-off employee can complete if they are offered a position and decline, and request not to be offered other or additional positions in the future.