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SB 497 – Enhances Protections For Employees And Applicants Who Engage In Certain Protected Activity
Under existing law, the Labor Code prohibits certain employers from retaliating against an employee or applicant because the employee or applicant engaged in certain protected activity.
Under existing law, Labor Code Section 98.6 prohibits an employer from discharging an employee or in any manner discriminating, retaliating, or taking any adverse action against any employee or applicant for employment because the employee or applicant, as applicable, engaged in certain protected activity, including certain whistleblower activity under Labor Code Section 1102.5. Under existing law, Labor Code Section 1197.5 generally prohibits employers from discharging, or in any manner discriminating or retaliating against, any employee because the employee invoked or assisted in any enforcement of California’s Equal Pay Act.
Effective January 1, 2024, Senate Bill 497 (SB 497) creates a rebuttable presumption in favor of an employee or applicant’s claim if the employer engaged in retaliation or other conduct prohibited by these laws within 90 days of the time the employee or applicant engaged in the relevant protected activity. As a result, SB 497 makes it easier for employees and applicants to establish a prima facie case of retaliation.
Under existing law, Labor Code Section 1102.5 generally prohibits an employer from retaliating against an employee for engaging in certain whistleblower related activity, as specified, if the employee has reasonable cause to believe that the information discloses a violation of state or federal statute, or a violation of or noncompliance with a local, state, or federal rule or regulation, regardless of whether disclosing the information is part of the employee’s job duties. Section 1102.5 also generally prohibits employers from retaliating against an employee for refusing to participate in an activity that would result in a violation of state or federal statute, or a violation of or noncompliance with a local, state, or federal rule or regulation.
SB 497 modifies an employer’s penalties for a violation of Section 1102.5 to include a civil penalty not exceeding $10,000 per employee for each violation, which is awarded to the employee who was retaliated against. SB 497 requires the Labor Commissioner, in assessing this penalty, to consider the nature and seriousness of the violation based on the evidence obtained during the course of the investigation, which shall include, but is not limited to, the type of violation, the economic or mental harm suffered, and the chilling effect on the exercise of employment rights in the workplace.
(SB 497 amends Sections 98.6, 1102.5, and 1197.5 of the Labor Code.)