Staying legal in '06: new law adds flex time for show biz; minimum wage hike defeated, but ...

As 2006 gets under way, California businesses face only a handful of new bills, although a couple could hit them hard in the pocketbook.

Among the new laws is one allowing employers to issue an employee's final paycheck through direct deposit and an agreement allowing employers in the motion picture and broadcast industries more flexibility in scheduling meal periods for union workers. There's also a new law requiting cosmetics manufacturers to list toxic chemicals in their products.

Dozens of other bills that had concerned business groups, such as increasing the minimum wage or new health care mandates, either failed in the Legislature or were vetoed by Gov. Arnold Schwarzenegger.

"Most of the bills we were most concerned about were not ultimately successful," said Michael Shaw, assistant state director of the National Federation of Independent Business.

Some of these bills may come back in this year's session--first among them is the one to increase the minimum wage. Labor groups are readying a minimum wage initiative to negate the threat of a Schwarzenegger veto.

The new law with arguably the biggest impact on employers is 2004's AB 1825 by former Assemblywoman Sarah Reyes, which required all organizations with 50 or more employees to put managers through sexual harassment training by Jan. 1 of this year and once every two years thereafter.

Of the bills passed in 2005, a ban on junk faxes attracted the most attention. SB 833, by Sen. Debra Bowen, D-Redondo Beach, requires the sender of fax advertisements to get the written permission of the recipient before sending the fax. Unlike federal law, there is no exemption for advertisers who have existing business relationships with the recipient. This would include, for example, a vendor sending out a fax to clients about its latest specials.

The Bowen law does contain an exemption for tax-exempt non-profits and trade associations that send information to their members. Nonetheless, business groups had opposed the law.

The junk fax ban did not go into effect on Jan. 1. In November, the U.S. Chamber of Commerce and Xpedite Systems Inc., a Delaware-based broadcast fax company, filed suit to stop the law, and on Dec. 21, a federal judge in Sacramento ordered the law put on hold at least through Jan. 31. A hearing is set for Jan. 23.

Business groups supported another law, AB 1093, by Barbara Matthews, D-Tracy, that allows employers more flexibility in making final payments to workers who are leaving.

Until now, employers have had to cut a check for that final payment and present a hard copy of that check to the employee. Under AB 1093, employers have the option to use direct deposit, as long as the employee had been paid regularly via direct deposit.

Employers in the entertainment industry now have increased flexibility in scheduling meal and rest periods, thanks to AB 1734, by Paul Koretz, D-Los Angeles. This law allows for the insertion of a clause in a collective bargaining agreement that allows for the rescheduling of the meal period or, if that's not possible, additional compensation for the employee.

Meanwhile, the cosmetics industry is being hit with a new disclosure mandate. Under SB 484, by Sen. Carole Migden, D-San Francisco, all cosmetics manufacturers selling their products in California must provide state regulators with a list of all chemicals in their products identified as causing cancer or reproductive problems. The master fist is to be maintined by state regulators.

The bill was opposed by the industry.

"The concern here is that the list of chemicals is arbitrary to begin with," said Gino DiCaro, communications director for the California Manufacturers and Technology Association. "Every time the list changes manufacturers have to change all their labels and notifications."