In November 2022, the City of Los Angeles passed the Retail Fair Workweek Ordinance. The ordinance will take effect on April 1, 2023. The ordinance establishes the requirements for retail companies in handling the scheduling and supply of work schedules to employees. Covered employees are any person who works in the City of Los Angeles for at least two hours per week for a covered employer and is entitled to the minimum wage as provided in the California labor code and wage orders, unless the worker is a bona fide independent contractor.
Prior to the effective date, the City of Los Angeles Office of Wage Standards has posted Frequently Asked Questions (FAQs) to assist with compliance with the ordinance.
Here are items to take note of from frequently asked questions:
Who is a covered employer?
Under the ordinance, a covered employer is a business that identifies as a retail business in the North American Industry Classification System (NAICS), has at least 300 employees worldwide, and exercises control over wages, hours or working conditions of any employee. The FAQs clarify that a retail business is any business whose primary NAICS code falls within categories and subcategories 44 through 45 of retail. If a company has more than one single line of business, the FAQs indicate that the Office of Wage Standards will consider the code that corresponds to the company’s primary business, for example, the activity from which it derives the largest percentage of its revenues. Total revenue.
What information is required for a good faith estimate?
Covered employers are required to provide new employees and current employees with good faith estimates of the employee’s work schedule. According to the FAQ, such estimates should include:
- The estimated number of hours the employee is expected to work each week and a notice of rights under the ordinance prior to hire.
- The days of the week the employee is expected to work, or the days of the week the employee is not expected to work.
- The times or shifts the employee can expect to work, including start and end times, at least 14 days in advance.
- The places where the employee is expected to work.
- Whether the employee can expect to work any shift on call.
- A good faith written estimate of future schedules within 10 days of the employee’s request.
For shifts that are not separated by 10 hours, does the premium payment apply to all hours or only to those that are not separated by at least 10 hours?
Under the ordinance, an employer will not schedule an employee to work a shift that begins less than 10 hours after the employee’s last shift without written consent. Covered employers will be required to pay an employee a time and a half premium for each shift that is not separated by at least 10 hours.
If an employee agrees in writing to work shifts that are not separated by at least 10 hours, the employer must compensate the employee a premium for all hours of the second shift.
If overtime premium is paid for a shift, is predictability pay due?
Under the ordinance, employers will be required to provide predictability pay when a covered employee has agreed to a change in their work schedule after the prior notice requirements set forth in the ordinance.
The employee is entitled to one additional hour of pay at his or her regular rate for each change to a scheduled date, time, or location that does not result in a loss of time for the employee or does not result in additional work time in excess of 15 minutes. . An employee is entitled to one-half of the employee’s regular rate of pay for time the employee does not work if the employer reduced the stated employee’s work time by at least 15 minutes.
However, for any hour for which the employer pays an overtime premium under California Labor Code section 510, the employer need not provide predictable pay.
The Office of Wage Standards will also publish rules and regulations and a required publication for the ordinance.
