News
December 5, 2014

Retail Workers Bill of Rights To Impact San Francisco Employers

Arnold & Porter Advisory

As retail stores throughout the city prepared for Black Friday sales in late November, the San Francisco Board of Supervisors unanimously passed a one-of-a-kind ordinance designed to protect employees from erratic work schedules.  If signed by Mayor Ed Lee?which is almost certain?the ordinance, known as the Retail Workers Bill of Rights, will likely become operative in Summer 2015.  The new law will have a significant impact on San Francisco's chain retail employers, defined as retail employers with 20 or more employees within San Francisco and 11 or more locations nationwide.

Scheduling Requirements and "Predictability Pay"

The Retail Workers Bill of Rights requires San Francisco's chain retailers to post employees' schedules at least two weeks in advance.  It also requires employers to provide advance notice of any changes to employees' schedules. 

Employers who make scheduling changes on fewer than seven days' notice will be subject to "predictability pay" to employees affected by the change.  In addition to the employees' regular pay for working the shift, employers will be required to pay:

  • one hour of pay for each shift change made with more than 24 hours' notice and fewer than seven days' notice; or
  • between two and four hours pay, depending on the duration of the shift, for each shift change made with less than 24 hours' notice. 

And, employees who are "on-call" but who are not actually called to work will also be entitled to between two and four hours of pay, depending on the length of the on-call shift. 

There are a limited number of exceptions to "predictability pay."  For example, an employer is not subject to predictability pay if it is short-staffed due to the unexpected illness of another employee, or if the employers' operations are unable to begin or continue due to certain emergencies or Acts of God.

The Retail Workers Bill of Rights also requires that employers provide new employees with a written, good-faith estimate of their expected minimum number of shifts per month, including the days and hours of those shifts.

Equal Treatment for Part-Time Employees

Under the new ordinance, chain retail employers will also be obligated to offer part-time employees the same starting hourly wage as full-time employees "who hold jobs that require equal skill, effort, and responsibility, and that are performed under similar working conditions …"  Part-time employees must also have access to the same paid and unpaid time off and be eligible for the same promotions afforded to full-time employees in the same job classification.  Employers may pro-rate this time, however, and will not be forced to contravene existing seniority or merit systems.

Existing Employees Get Priority for Additional Hours of Work

Another critical provision of the ordinance requires employers to offer current part-time employees any additional, available, hours of work before hiring new employees, contractors, or temporary workers to do the job.  This offer must be in writing.

Retaliation Prohibited

Unsurprisingly, the Retail Workers Bill of Rights also contains an anti-retaliation provision, prohibiting employers from interfering with or restraining any employee's exercise or attempt to exercise any rights under the ordinance.  This includes, but is not limited to, requests for a modification of an initial proposed work schedule, the right to file a complaint with and cooperate in an investigation by the Office of Labor Standards Enforcement, and the right to oppose any policy, practice, or act that is unlawful under the ordinance.

Enforcement

The ordinance will be enforced by San Francisco's Office of Labor Standards Enforcement ("OLSE"), which may conduct investigations and impose civil penalties.  In addition, the City Attorney may also bring a civil action for legal or equitable relief, including lost wages, civil penalties, reinstatement of employment, and attorneys' fees and costs.

Best Practices

Though hailed as groundbreaking, the Retail Workers Bill of Rights will not be without challenges for retail employers.  For example, many employers rely on computer software to create work schedules.  To avoid "predictability pay" and other civil penalties, employers are advised to coordinate with their software providers to ensure that their software is compliant with the new ordinance.

Employers may also consider revisiting their existing policies concerning time off from work.  Because the ordinance requires that employers post schedules at least two weeks in advance, employers will want to ensure that employees are required to provide ample notice of any predictable time off or other scheduling conflicts. 

Employers impacted by this ordinance are also advised to maintain copies of all schedules for a minimum of three years, in accordance with the law's recordkeeping requirements.

The ordinance provides that the OLSE may adopt rules or regulations to implement the ordinance.  Although it is unlikely such regulations will be issued soon, if at all, the OLSE's guidance will help clarify ambiguous or undefined language in the Retail Workers Bill of Rights.  

The City of San Francisco is often at the forefront of employment law trends, so employers can expect to see similar legislation crop up in other cities.  Lawmakers in Milwaukee, New York, and Santa Clara are already looking at similar bills.  Congress has also taken note of the Retail Workers Bill of Rights, meaning similar federal protections could be just around the corner. 

Employers who have questions about their rights and obligations under this ordinance are encouraged to speak with an employment attorney.

 

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