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Published on Tuesday, December 13, 2016

San Jose Passes First of Its Kind HR Law

Author: Heather Nezich

A new ordinance was recently passed in San Jose, CA that is unlike anything else in the U.S. to date.  It states that San Jose employers must offer additional work hours to part-time staff before hiring new employees.  It’s called the Opportunity to Work ordinance.

The ordinance is expected to take effect on March 8, 2017.  It will apply to any employer conducting business within San Jose city limits that have 36 or more employees.  The only exception is that work hours do not have to be offered to existing employees if it would require overtime or premium pay.

Employers affected by this local ordinance must display posters visible to employees describing the policy.  They’ll also have to create and retain records proving that any hours worked by a new hire were first offered to existing employees.  If they were not, a detailed explanation will be required.  There are some hardship exemptions available if employers can prove that they’ve made a good faith effort to comply.  But they would have to prove that compliance would be “impracticable, impossible or futile” – likely, a hard case to make.

Initially non-compliance will not result in any financial penalties; however, subsequent violations could result in fines up to $50 per day per employee.  Administrative proceedings could cost upwards of $2,500 per day per violation and up to $100,000 for serious violations.

The ordinance was created to help part-time employees qualify for benefits, which most employers only offer to full-time staff.  In addition, it’s meant to help boost pay for part-timers who have a desire to work more. According to Maria Noel Fernandez, director of community organizing for the Working Partnerships USA branch, the proposal would benefit about 64,000 San Joseans who work part-time. However, this could have a serious impact on business who tend to maintain part-time staff in order to keep benefit costs down.  When the ordinance was initially proposed, City Councilman Johnny Khamis had stated that he was worried that the proposal, combined with expected new drives to raise the sales tax and the minimum wage to $15 an hour, would scare off businesses wishing to move or expand to San Jose.  “We may be undoing a lot of the work we’ve done to attract new business,” Khamis said. “If it was just this one thing, it might not be so egregious.”

California has a reputation for creating HR laws that eventually find their way across the country.  Employers should keep an eye on how this plays out and how businesses react to it and are affected by it.


Source: hrmorning.com; mercurynews.com


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