The beginning of 2016 is the perfect time for employers to review their policies and practices to ensure compliance with new laws. We have summarized the top five things California employers should know for 2016.

1. Minimum Wage: As of January 1, 2016, minimum wage increased to $10 per hour. All employees must be earning at least $10 per hour to comply with the new minimum wage requirements.

2. Handbook Review: The start of the new year is the perfect time to review your handbook. Is your handbook five years old (or worse)? Did you pull the current one off the internet? Pilfer it from a former company? A good handbook can protect you from litigation. Make sure yours is up-to-date.

3. Commission Agreements: California law requires companies to have written commission agreements with employees receiving commission compensation. Even if it wasn’t the law, it is a great idea. We’ve litigated several cases involving poor (or no) commission agreements that have made companies thousands of dollars.

4. Independent Contractors: Make sure those individuals your paying by 1099 are actually independent contractors. If they are, make sure you have a good independent contractor agreement. A bad agreement—or no agreement—puts you at risk of claims by these workers that they should have been treated as employees.

5. Fair Pay Act: Currently, the Act prevents an employer from paying an employee a wage rate less than those paid to members of the opposite sex for equal work. Now, this law will change the requirement from equal work to substantially similar work, making this standard one of the strictest in the country.

We all know it isn’t easy doing business in California, but following these new laws and having these agreements in place can protect you substantially.


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