Effective March 13, 2017, San Jose, California’s Opportunity to Work Ordinance (Ordinance) requires certain employers to offer additional work hours to existing qualified employees before hiring new employees, subcontractors, or temporary staffing.
Covered Employers: The ordinance generally applies to employers with 36 or more non-exempt employees that are either subject to the city’s business license tax or have a place of business in the city that is exempt under state law from that business license tax.
Chains and Franchisees: For a chain business that is not owned by a franchisee, the number of employees is determined by the combined total number of employees at every location of that chain business, regardless of whether it is located within San Jose.
For a franchisee, the number of employees is determined by the combined total number of employees at every location owned by that franchisee and operated under the same franchisee, regardless of whether it is located within San Jose.
Hardship Exemption: Employers can seek a hardship exemption from the ordinance with the Office of Equality Assurance (OEA). The OEA will develop guidelines for such exemptions.
Covered Employees: The law applies to non-exempt employees who, in a calendar week, perform at least two hours of work within San Jose and qualify as an employee entitled to minimum wage under California’s minimum wage law, including temporary and seasonal employees. Employees who are exempt from California’s overtime requirements are not covered by the law and do not count toward the 36-employee threshold.
Requirements: Before hiring additional employees, subcontractors, or temporary services, employers must offer additional work hours to existing employees who, in the employer’s good faith and reasonable judgment, have the skills and experience to perform the work. The offer should be in writing. Employers must also use a transparent and nondiscriminatory process to distribute the hours or work among those existing employees.Employers are not required to offer additional hours if it would result in overtime pay or other premium pay under any law or collective bargaining agreement.
Notice: Covered employers are required to prominently post a notice at the workplace informing employees of their rights. The notice must be posted in any language spoken by at least five percent of the employees at the workplace or job site. The English, Spanish, Vietnamese, and Cantonese versions of the notice are available here.
Recordkeeping: Employers must retain the following records for at least four years:
• Work schedules and employment and payroll records pertaining to current and former employees;
• Copies of written offers to current and former part-time employees for additional work hours; and
• Any other records the OEA may require that employers maintain to demonstrate compliance.
Recommendations: Covered employers should review the entire Ordinance carefully to understand its requirements and ensure compliance. Employers should also review the Frequently Asked Questions and Suggested Steps for Employers, both of which can be found on the city’s webpage. Anyone involved in the scheduling of employees should also be trained on the Ordinance’s requirements, and employers should contact their HR Business Partners if they have any questions.