What Laws Apply When Hiring More Employees?


Hiring More Employees Equals More Regulations

While growing your business and your team can be an exciting time, it can also be pretty stressful. As a fastgrowing law firm, we’ve had first hand experience and would like to share with our fellow growing business in San Diego. Here’s some helpful legal advice and things to know when hiring both your 5th and 15th employees.

What Laws Apply When Hiring Your Fifth Employee in California?

After a business in California hires a fifth employee, the business must then comply with multiple administrative regulations. First, a business with five or more employees falls under the purview of the California Fair Employment and Housing Act (FEHA).1 The FEHA prohibits California employers from discriminating against qualified individuals on the basis of a physical disability, mental disability, or medical condition. Under this act, employees working for employers with five or more employees are entitled to four months of pregnancy disability, with benefit continuation. In addition, more leave may be available under the Fair Employment and Housing Act as an accommodation, if the employee is disabled by pregnancy and needs more than four months off. Also, eligible employees, those who have worked for the employer for 1,250 hours in the last year, are entitled to up to 12 weeks of baby bonding leave following the birth or adoption of a child, with such time being available to both the mother and the father of the child.  

Another requirement imposed on employers with five or more employees is that they may not consider the criminal history of a prospective employee until a conditional offer of employment has been made.2 Employers must thus remove any questions on an employment application that requires disclosure of an applicant’s conviction history. In addition, employers may not consider as part of a background check: (1) arrests not followed by a conviction; (2) a referral to or participation in a pretrial or posttrial diversion program; or, (3) convictions that have been sealed, dismissed, expunged, or statutorily eradicated pursuant to law. Furthermore, California businesses with five or more employees must adhere to the California Secure Choice Retirement Savings Trust Act.3 The act requires all private employers who do not offer their employees an employer-sponsored retirement program to participate in the program provided by the act.  

Starting January 1, 2020, employers with five or more employees must provide 2 hours of sexual harassment training for supervisors and 1 hour of training to non-supervisors.4Employees must be retrained once every two years and the initial training must occur within the first six months of hiring or promotion to a supervisory position. Businesses with five or more employees will also need to update their employee manuals with the training requirements, anti-harassment policies, hang updated posters, and hand out the California sexual harassment brochure to employees.  

What Laws Apply After Hiring Your 15th Employee?

Once a business has fifteen or more employees, it is immediately subjected to certain federal employment laws. The two primary federal acts applicable to businesses with fifteen or more employees are the Americans with Disabilities Act (ADA) and Title VII of the Civil Rights Act. These two acts deal with discrimination, with the ADA pertaining to disabilities and Title VII addressing discrimination based on sex, race, religion, and national origin.  

A person has a disability for the purposes of the ADA if: he or she has a physical or mental impairment that substantially limits major life activities; has a record of such impairment; or is regarded as having a condition people would mistakenly perceive as limiting, such as disfigurement.5 For employers, the ADA requires the providing of reasonable accommodations to enable an otherwise qualified person with a disability to do his or her job. A reasonable accommodation is any change in the work environment (or in the way things are usually done) to help an individual with a disability apply for a job or perform the duties of a job. However, an employer does not have to provide a reasonable accommodation if it imposes an undue hardship on the employer, nor is an employer required to lower quality or production standards to make an accommodation.  

Another Federal act that employers of fifteen or more employees must comply with is the Pregnancy Discrimination Act. This act amended Title VII of the Civil Rights Act to “prohibit sex discrimination on the basis of pregnancy.”6Pregnancy is considered to be a temporary disability, meaning the treatment of pregnant employees falls under the same guidelines as disabled employees under the ADA. Therefore, treating a pregnant employee in a way that would violate disability standards is also a violation of the Pregnancy Discrimination Act.  

Lastly, employers with 15 or more employees are required to comply with the Genetic Information Nondiscrimination Act (GINA). Under this act, employers are prohibited from discriminating against employees or applicants based on their genetic information.7 The genetic information protected by the law includes family health history, the results of genetic tests, the use of genetic counseling and other genetic services, and participation in genetic research.  

While California has strong anti-discrimination regulations for employers with five or more employees, obtaining fifteen or more employees will place a business under the umbrella of Federal discrimination laws, thus awarding more protections to employees. All of the federal discrimination laws are enforced by the Equal Employment Opportunity Commission while the California laws are governed by the Department of Fair Employment and Housing.  

 At Slate Law Group, our employment law practice provides assistance to both San Diego employers and employees. Since California and Federal employment law is constantly changing, it is imperative to consult an attorney regarding your business’s practices. Consulting with an experienced attorney will ensure that all regulations are satisfied to best serve the interests of your business.

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