2020
Business Law
Key Statutory Developments

California’s Mini-CFPB

Consumer-finance businesses will soon face a new California state regulatory agency with novel and expanded enforcement powers, even as two major federal regulatory agencies have been fighting in the Supreme Court to save their longstanding enforcement powers.

On September 25, 2020, Governor Gavin Newsom signed the California Consumer Financial Protection Law (CCFPL), which renames California’s existing Department of Business Oversight (DBO)  the Department of Financial Protection and Innovation (DFPI). The CCFPL provides this “mini-CFPB” with robust powers and abilities paralleling the CFPB’s, most of them effective January 1, 2021.

Both of the old federal marshals, the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB), have a history of complex enforcement actions in concert with state agencies, such as “Operation Game of Loans” (against student loan consolidators) and “Operation Corrupt Collector” (against debt collectors). The DFPI is sure to be a powerful actor in such combined efforts going forward, and businesses should pay close attention as the DFPI develops regulations under its broad powers.

More analysis on this and related topics from CEB:
Current Awareness Articles
The New Sheriff in Town: California’s Mini-CFPB
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Debt Collection Practice in California

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Key Developments in Business Law 2020
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The Endless Dynamex Saga: AB 2257

In the latest legislative move in the wake of the California Supreme Court’s decision in Dynamex Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903, which introduced the ABC test for the purpose of determining employee status, AB 2257 repealed Labor Code section 2750.3 and replaced it with Labor Code sections 2775 through 2787. AB 2257 became effective on Sept. 4 as urgency legislation. The bill retained the ABC test, but recast the descriptions of certain previously exempted occupations and included even more exemptions. The most significant aspect of AB 2257, and undoubtedly the one that will be the focus of future litigation, are the various exemptions from the ABC test that appear in Labor Code sections 2776 through 2784, including exemptions based on the relationship between specified parties, exemptions for specified persons or entities, specified persons and occupations in the performing arts, and contracts for professional services.

More analysis on this and related topics from CEB:
Current Awareness Articles
The Never-Ending Story: Details on the Latest Legislative Developments in the Aftermath of Dynamex
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Advising California Employers and Employees
California Wage and Hour Law and Litigation

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Key Developments in Employment Law 2020
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Employers’ Annual Pay Data Report: SB 973

On or before March 31, 2021, and on or before March 31 each subsequent year, private employers with 100 or more employees and who are required to file an annual Employer Information Report (EEO-1) under federal law must submit a pay data report to the Department of Fair Employment and Housing (DFEH). The law requires collection of “Component 2”-type pay data for California employers by race and gender that was halted on the federal level in the EEO-1.

More analysis on this and related topics from CEB:
Current Awareness Articles
Five New Laws With the Most Impact on California Employers
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Advising California Employers and Employees

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Key Developments in Employment Law 2020
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California Family Rights Act (CFRA) Expansion: SB 1383

Effective Jan. 1, 2021, SB 1383 significantly expands the CFRA by extending its applicability to employers with 5 or more employees, compared to 50 or more employees currently. In addition, the new law expands the family members for whom an employee can take leave to include care of grandparents, grandchildren, siblings, and domestic partners with a serious health condition, in addition to existing leave to care for a child, parent, or spouse. This law will have a significant impact on small employers who have not previously been subject to the CFRA.

More analysis on this and related topics from CEB:
Current Awareness Articles
Five New Laws With the Most Impact on California Employers
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Employee Leave Laws: Compliance and Litigation

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Key Developments in Employment Law 2020
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Workers’ Compensation, COVID-19: SB 1159

Effective immediately, this bill codifies the governor’s May 6 Executive Order N-62-20. It will be automatically repealed Jan. 1, 2023. Applicable to employees who test positive during an “outbreak” at the employee’s “specific place of employment,” and applicable to employers with five or more employees, this bill applies to all dates of injury on or after July 6, 2020. Employees may be awarded full hospital, surgical, and medical treatment; disability indemnity (only after exhausting any COVID-specific paid sick leave); and death benefits. An employee’s COVID-19 illness or death is presumed to arise out of and in the course of the employment if the employee tests positive within 14 days of performing labor or services at the place of employment.

More analysis on this and related topics from CEB:
Current Awareness Articles
Five New Laws With the Most Impact on California Employers
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California Workers’ Compensation Practice

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Key Developments in Employment Law 2020
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California Supplemental Paid Sick Leave: AB 1867

On Sept. 9, Governor Newsom signed AB 1867 into law, providing supplemental paid sick leave for California employees and codifying provisions of Executive Order N-51-20 that had already provided paid sick leave for “food sector workers.” California employers should take time to review the new law to ensure compliance, even if they were covered under the prior executive order. The new law creates obligations for employers to provide COVID-19 supplemental paid sick leave to non-food sector employees starting no later than Sept. 19, 2020.

More analysis on this and related topics from CEB:
Current Awareness Articles
Five New Laws With the Most Impact on California Employers
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Employee Leave Laws: Compliance and Litigation

CLE
Key Developments in Employment Law 2020
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California Voters Choose Privacy: CCPA

California’s Proposition 24 won handily Election Night, with an estimated 56% of voters approving its passage. The ballot measure enacts the California Privacy Rights Act of 2020 (CPRA), which amends the California Consumer Privacy Act of 2018 (CCPA). Among other things, the CPRA extends the business-to-business and employee limitations from Jan. 1, 2021, to Jan. 1, 2023. It expands the consumer’s right to opt out from a business’s “sale” of the consumer’s information to a right to opt out of the “sale or sharing” of that information. Another provision expands the CCPA’s existing limited private right of action to include breaches that expose a consumer’s email address and password or security question that would permit access to the email account. It also creates a new category of “sensitive personal information” to include certain financial, biometric, racial, ethnic, sexual, and genetic information as well as precise geolocation data and the contents of mail and email. The Act also creates additional consumer privacy rights, including the right to correct inaccurate personal information.

More analysis on this and related topics from CEB:
Current Awareness Articles
California Voters Approve the California Privacy Rights Act
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Privacy Compliance and Litigation in California

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Key Developments in Business Law 2020
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The Debt Collection Licensing Act: SB 908

The debt collection segment is poised for explosive growth due to the financial disruption brought by COVID-19, and California is trying to get ahead of the game. Earlier this year, Gov. Gavin Newsom signed an executive order preventing debt collectors from garnishing COVID-19 government stimulus and relief payments to individuals. And on Sept. 25, the governor signed into law SB 908, the Debt Collection Licensing Act (DCLA) (Stats. 2020, ch. 163). The DCLA does not replace but rather supplements the existing federal Fair Debt Collection Practices Act (FDCPA) (15 U.S.C. §§ 1692–1692p), California Rosenthal Fair Debt Collection Practices Act (Rosenthal Act) (Civ. Code, §§ 1788–1788.33), and California’s Fair Debt Buying Practices Act (FDBPA) (Civ. Code, §§ 1788.50–1788.64). In addition to a new licensing requirement, the DCLA permits the DBO to order violators to pay ancillary relief in the form of refunds, restitution, disgorgement, and damages.

More analysis on this and related topics from CEB:
Current Awareness Articles
New California Law Licenses Debt Collectors
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Debt Collection Practice in California

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Key Developments in Business Law 2020
This CEB program is available via a CEB Passport, Course Pass, or Compliance Package.