New California FEHA Regulations ‘Clarify’ Definition of Employer

The Fair Employment and Housing Act (FEHA) now has a new counting method for the five-employee threshold.

Heads up, employers — new Fair Employment and Housing Act (FEHA) regulations are now effective. In June 2019, the Fair Employment and Housing Council (FEHC) approved new regulations, which primarily seek to “clarify” the definition of employer that will determine when to apply the FEHA including the FEHA’s harassment prevention training requirements.

Definition of Employer

The FEHA applies to employers “regularly employing five or more persons,” but the FEHC determined it needed to clarify the definition of “employer” in order to avoid “unintended gaps” in applying the FEHA. Therefore, the new regulations redefine what “regularly employing” means and who counts towards the “five or more persons” requirement.

The old regulations said that “regularly employing” meant employing five or more individuals each working day in any 20 consecutive calendar weeks. The new regulations remove the 20 consecutive week criteria and now state that “regularly employing” means employing five or more individuals:

  • “For any part of the day on which the unlawful conduct allegedly occurred;” or
  • On a “regular basis.”

According to the regulations, “’regular basis’ refers to the nature of a business that is recurring, rather than constant.”

To illustrate, the regulation provides an example of an industry with a three-month season, stating that if an employer employs five or more individuals during that season, then the employer “regularly employs” the requisite number of employees to be covered by the act. In other words, seasonal employers may be covered by the FEHA even if they do not have five employees working throughout the year, so long as five or more employees are on the payroll during the season.

Although intended to clarify things, this new “regular basis” concept seems more likely to lead to disputes over what the term means, when the nature of a business is “recurring, rather than constant” and what constitutes a “season.”

The new regulations clarify that part-time employees count towards the five-employee threshold, including individuals who work partial days and fewer than each day of the work week.  

Additionally, the new regulations state that the new method of achieving the five-employee threshold also apply for establishing coverage under the California Family Rights Act (CFRA), the New Parent Leave Act (NPLA) and FEHA’s harassment training requirements.

Harassment Training Requirements Changes

The FEHA imposes harassment prevention training requirements for employers with five or more employees. The new regulations now state that for counting purposes only, “employees” include paid and unpaid interns and “persons performing services pursuant to a contract,” i.e., independent contractors.

In a training FAQ, the FEHC confirms that this “counting purposes only” change means they only count toward the training threshold and does not expand the definition of “employee” beyond that. In other words, employers do not need to start training their independent contractors, volunteers or unpaid interns; however, this is always a good best practice.

Employers, especially small employers and seasonal employers, should consult with legal counsel to determine the implications of and their obligations under the newly revised FEHA regulations.

James W. Ward, Employment Law Subject Matter Expert/Legal Writer and Editor

CalChamber members can read more about California’s Fair Employment and Housing Act in the HR Library. Not a member? See what CalChamber can do for you.

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