In this podcast celebrating Hispanic Heritage Month, Shareholder and Global Practice Leader Peter Susser talks with Juan Carlos Varela, Shareholder of Littler’s Miami and Caracas offices, about becoming Littler’s first international attorney, extending a labor and employment law practice beyond the United States, and how that helped him achieve the American dream.

Are you wondering about the CPRA’s enforcement framework and enforcement risk? California is about to launch the first-ever U.S. administrative agency dedicated exclusively to enforcing a privacy law and conducting compliance audits. Is your organization prepared? In this podcast, Littler’s Privacy Practice Group Co-Chair, Philip Gordon explains the CPRA’s regulatory framework and provides insights regarding enforcement risk.

Oct. 14 is the annual deadline for employers that offer prescription drug benefits to notify Medicare-eligible employees and dependents of whether coverage under the employer’s plan is equivalent with Medicare Part D. Model notices are available online.

California Governor Gavin Newsom just signed into effect a first-in-the-nation law that specifically targets warehouse distribution centers with complicated restrictions that regulate the use of production quotas. While much of the media attention surrounding AB 701 has focused on high-profile online retailers, the broad scope of the bill signed yesterday means it will potentially apply to many employers across a wide range of industries that utilize warehousing operations and distribution centers. This new law contains a multitude of legal risks and goes into effect on January 1, 2022. If AB 701 applies to your operations, you will need to start preparing now. What do employers need to know about this significant new law?

Which Employers Does AB 701 Target?

The first step to examine is which businesses will be impacted by the new law. AB 701 targets employers that utilize “warehouse distribution centers” and that meet certain employee population thresholds.

What Is a Warehouse Distribution Center?

In summary, AB 701 broadly applies to establishments that are primarily engaged in operating merchandise warehousing and storage facilities, that sell durable and/or nondurable goods to other businesses, or that are primarily engaged in selling merchandise using non-store means, such as through the Internet or catalogs.

Rather than provide a clear definition, AB 701 cites four NAICS Codes to define a “warehouse distribution center”:

  • 493110 – General Warehousing and Storage;
  • 423 – Merchant Wholesalers, Durable Goods;
  • 424 – Merchant Wholesalers, Nondurable Goods; and
  • 454110 – Electronic Shopping and Mail-Order Houses.

It then requires employers to determine if their warehouse and/or distribution centers fit into those NAICS Codes. You should carefully review each applicable NAICS Code definition to determine if AB 701 applies to your business. The law specifically exempts establishments that qualify as Farm Product Warehousing and Storage under NAICS Code 493130.

Note that under AB 701 it is irrelevant which NAICS Code you or another entity has assigned to your establishment. If any of these definitions could apply to your establishment, your warehouse and/or distribution center qualifies.

Do You Meet the Employee Population Threshold?

If your establishment qualifies as a warehouse distribution center, you then need to determine if you meet the employee population threshold.

AB 701 applies to employers that employ or exercise control over the wages, hours, or working conditions of 100 or more employees at a single warehouse distribution center, or 1,000 or more employees at one or more distribution warehouse centers in California.

Employers must include in the population count workers who are provided through third parties, such as staffing agencies, if the employers exercise control over those workers’ wages, hours, or working conditions. They must also include in the count all employees of the “commonly controlled group” who work at distribution warehouse centers in California.

AB 701’s New Requirements

Qualified employers who use quotas must carefully follow—and quickly implement—AB 701’s new requirements.

Regulating Quotas

Employers may implement quotas for their nonexempt warehouse employees, but those quotas now have specific restrictions. Under AB 701, a “quota” is a work standard assigned to an employee that the employee must complete within a defined time period or face an adverse employment action. A work standard is a requirement that the employee perform a specified productivity speed, perform a quantified number of tasks, or handle or produce a quantified amount of material.

Employers cannot require quotas that prevent compliance with meal or rest periods, use of bathroom facilities (including the time to travel to and from such facilities), or occupational health and safety laws. Additionally, the time employees spend complying with occupational health and safety laws must be considered as on task and productive for purposes of any quota — although meal and rest breaks are not considered productive time unless employees remain on call.

Written Descriptions of Quotas

Starting January 1, 2022, AB 701 requires employers to provide to each new hire a written description of applicable quotas. A compliant written description must include each work standard, the defined time period the work standard must be completed in, and any potential adverse employment actions if the quota is not met.

AB 701 also requires employers to give written descriptions of quotas to all current employees by January 31, 2022. Employers who do not already provide compliant written descriptions of quotas must act quickly to meet this deadline.

Taking Adverse Actions Against Employees Who Do Not Meet Quotas

AB 701 allows employers to take adverse actions against employees who do not meet their quotas. Still, you cannot do so if the quotas prevent compliance with meal or rest periods or occupational health and safety laws. Additionally, you cannot take adverse actions against an employee for failing to meet a quota unless the employee received the quota in writing as required by the law and discussed above.

Request for Records

Current or former employees who believe that a quota violated their right to meal or rest periods or any occupational health and safety laws can request a written description of each quota that applies to them and their work speed data over the previous 90 days. Employers must provide this information no later than 21 calendar days from the date of the request. Former employees may only make one such request. The law does not limit the number of requests current employees can make.

Notably, the law allows current or former employees to make written or oral requests. Additionally, a request for records under AB 701 does not include qualitative performance assessments, personnel records, or itemized wage statements. Employees who want that information must use procedures already in place through other Labor Code sections.

Enforcing AB 701

AB 701 also introduces many enforcement mechanisms.

Retaliation Claims, Injunctions, and PAGA Claims Are Available to Employees

The law creates new opportunities for employees to enforce the law. Of course, in doing so, the law creates new avenues for plaintiffs’ attorneys to line their pockets. First, the law presumes retaliation if employers take adverse action against employees who, in the previous 90 days, have 1) requested for the first time in the calendar year their quota and/or work speed data or 2) complained to their employers or government agencies about an alleged violation of AB 701.

Second, the law allows current and former employees to bring an action for injunctive relief for any alleged violations of AB 701. It also allows those employees to recover costs and attorneys’ fees if they prevail.

Third, the law allows plaintiffs to include AB 701 violations in PAGA actions. With that said, the law also allows employers to cure any alleged violations before plaintiffs file a lawsuit. But that may be cold comfort for employers already facing frequent PAGA shakedowns.

New State Actions

The law also creates new requirements for government agencies. The Labor Commissioner must coordinate with other government agencies to educate employees, track injury data, and enforce AB 701. The Labor Commissioner can also use already available enforcement mechanisms to enforce AB 701.

Additionally, the law requires Cal/OSHA and the Division of Workers’ Compensation to notify the Labor Commissioner if a worksite or employer has an annual employee injury rate of at least 1.5 times higher than the industry average.

What Employers Should Do Now

If AB 701 applies to you, act now to ensure compliance before the law goes into effect on January 1, 2022.

  1. Evaluate your current quotas. Although you likely already do this, ensure any quotas do not prevent employees from taking compliant meal and rest periods, using the bathroom, or complying with health and safety laws.
  2. If you utilize quotas, make sure that you create and produce written quotas for each employee. Current employees must receive compliant written descriptions of quotas by January 31, 2022. Additionally, new employees must receive compliant written descriptions of quotas at the time of hire.
  3. Create a process for data requests. Ensure that you have processes in place — and that you communicate those processes — for employees to request their data in writing or orally. Also ensure that you have processes in place to provide that data within 21 days of the request.
  4. Pause before taking adverse actions. The unlawful retaliation presumption creates significant risks for employers who want to discipline, terminate, or take any other adverse action against their nonexempt warehouse employees. Of course, employers should always ensure that their reasons for taking an adverse action are proper and well-documented. But, with this new presumption, employers should be even more careful.

We will monitor developments related to this new law and provide updates as warranted, so make sure that you are subscribed to Fisher Phillips’ Insights to get the most up-to-date information direct to your inbox. If you have further questions on how to comply with AB 701, contact your Fisher Phillips attorney, the author of this Insight, or any attorney in any one of our six California offices.

​The ability to give feedback is a superpower. Little nuggets of feedback can change lives. But the word

Employers should consider how they will navigate the legal and operational challenges related to required vaccination and testing, such as vaccination tracking and management; health and religious accommodations; and wage and hour implications.

On the heels of the FDA’s full approval of the Pfizer vaccine, several major U.S. cities are requiring vaccines for entry to restaurants, shops, and entertainment facilities – and some businesses are instituting their own vaccine requirements for guests. Those restaurants, hotels, and other businesses being forced to comply with another law have questions about how to best handle this potentially touchy situation, but even those businesses introducing their own guest vaccine mandate on their own need guidance in this area. This article provides businesses tips on how to comply with or roll out vaccinated-only mandates and avoid some legal pitfalls in doing so.

Tip No. 1: Understand the Law in Your Local Jurisdiction

While some U.S. cities like New York City, San Francisco, New Orleans and Honolulu require proof of vaccination to enter indoor dining, fitness, or entertainment venues, other states like Florida have prohibited business owners from implementing vaccinated-only policies and excluding unvaccinated patrons. It is key that you review and understand the law in the locality where you operate so you can comply.

For example, in New York, guests over the age of 12 must show proof of having received at least one dose of a COVID-19 vaccine, and businesses will be required to hang specific posters describing the mandate near entrances. Businesses that don’t comply can look forward to fines as enforcement begins on Sept. 13. In San Francisco, on the other hand, guests over the age of 12 must be fully vaccinated to go inside the same kind of establishments. Some cities, like New Orleans, will provide businesses with greater flexibility by permitting evidence of a negative COVID-19 PCR test taken no more than 72 hours before entry in lieu of proof of vaccination. Because these rules are rapidly changing month over month, companies operating in multiple states should consult a local Fisher Phillips attorney to determine how best to navigate their particular situation.

Tip No. 2: Prepare for the Public Pushback

Operating any business during a global pandemic is difficult. Add various (and everchanging) legal mandates directed at requiring compliance from a politically polarized public and it may start to seem impossible. But it is possible; here are some tips:

  • Train Your Staff

Your staff and public-facing employees will be handling compliance with the mandates. It is crucial to train your employees on how to politely inform patrons of the requirements in your jurisdiction (either proof of vaccination and/or proof of a negative PCR test) if they wish to enter your premises.

Prepare staff to alert a designated manager to handle non-compliant patrons and ensure that a designated manager is prepared to calmly and effectively deescalate the situation.

  • Provide Notice to Patrons

While you may assume everyone knows of any government-required mandate or your businesses’ own requirement, it is important for you to provide as much notice as possible to customers concerning the local vaccination mandate prior to their arrival. Doing so can help reduce confusion and prevent an uncomfortable situation. Personal service providers (such as spas and salons) and hospitality businesses (such as hotels and restaurants) should provide notice of the policy when confirming reservations. A simple message to visitors and guests is best, not only confirming the reservation but highlighting your efforts to keep them and your staff safe by sharing your policy of requiring proof of vaccination for indoor entry.

You can also post notices on your public-facing website, apps, and social media platforms to notify visitors of the vaccination mandate ahead of time. Another common strategy is posting conspicuous signs in prominent places at your entrances. The notices should include a statement that you have the right to refuse entry or service to anyone not complying with your new vaccination policy for indoor activities, particularly where required by local law.

  • Communicate Clearly and Calmly to Non-Compliant Patrons

Your establishment is bound to encounter non-compliant guests as so many people have strong feelings regarding vaccination mandates. The first step in such an unfortunate situation is to ensure that staff have a prepared in advance, scripted request for patrons who do not comply. If the patron does not respond positively, the employee should notify the designated manager to handle the situation.

The designated manager should share either the legal requirements of the jurisdiction and/or your businesses’ policies. The manager should then inform the guest that they will not be permitted indoors if they continue to refuse to comply. Consider offering to-go or outdoor dining service if possible. If the guest does not cooperate, the manager should inform them that they are welcome to return if they comply with the policy or when the need for proof of vaccination is gone. Where possible, your manager should offer to reschedule an appointment or reservation.

If the situation escalates, the manager should know to call on the business’ security personnel or local authorities in the same manner you would handle a trespassing situation. Regardless of how the situation concludes, the manager should immediately document the incident in objective, non-emotional terms. They should be instructed to provide the documentation to key personnel (human resources, legal, etc.) as soon as possible, and your business should retain the report in the event you are required to later demonstrate what happened.

Tip No. 3: Prepare for Accommodation Questions

It’s also likely that your business will encounter guests who claim they should be exempt from the government mandate or your business policy because of a medical or religious reason. Be prepared to deal with both situations.

  • What happens when a patron claims they cannot be vaccinated because of a disability?

Title III of the Americans With Disabilities Act prohibits places of public accommodation from applying eligibility criteria that screen out or tend to screen out a person with a disability, or any class of people with disabilities, unless they qualify as legitimate safety requirements necessary for the safe operation of the facility. While the Department of Justice has not issued any guidance for vaccination mandates by public accommodations, it is unlikely that a vaccine requirement would qualify as an ADA-eligibility criterion. Furthermore, given the significant data on the effectiveness of the COVID-19 vaccine reducing transmissibility and severe disease, there is a strong argument that unvaccinated individuals pose a significant risk of harm to others indoors. 

With that said, businesses are still required under the ADA to make reasonable modifications to procedures to provide individuals with disabilities with access to their goods, services, and facilities, unless such modifications would present a direct threat to the health and safety of others, or fundamentally alter the business. The modifications will vary from business to business and locality to locality. For example, New York recommends offering unvaccinated guests an opportunity to order take-out or join a virtual exercise class. Meanwhile, San Francisco suggests businesses seat unvaccinated customers in an outdoor area or try to connect guests with similar services in the area that host outdoor options. If your businesses can determine workable modifications for unvaccinated guests in advance, it should post details on its website.

  • What about patrons who claim they cannot be vaccinated because of their religious beliefs?

Title II of the Civil Rights Act of 1964 prohibits discrimination in public accommodations such as restaurants and hotels on the basis of race, color, religion or national origin. The law is less clear when it comes to vaccine or mask mandates. The current consensus among courts suggests businesses are not unlawfully discriminating by generally enforcing a government-mandated vaccination requirement, and this standard seems likely to also apply to business-created mandates. Further, at least two courts have decided that businesses need not accommodate religious beliefs to comply with Title II. This may change as appeals work their way through the courts, so it is important to be aware of the developing law in your area.

No matter how such appeals turn out, businesses should keep a record of accommodation requests, resolutions, and compliance efforts to show they are doing their best to satisfy the requirements of local and federal laws.


We encourage businesses to consult with a local Fisher Phillips attorney to determine how to limit your exposure in complying with the new rules or rolling out your own vaccine policies for guests. We will monitor these developments and provide updates as necessary. Make sure you are subscribed to Fisher Phillips’ Insight system to get the most up-to-date information. If you have questions, visit our Vaccine Resource Center for Employers or contact your Fisher Phillips attorney, the authors of this Insight, or any attorney in our Hospitality Industry Practice Group.

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