This is an ongoing series looking at the nine California Labor Rules to Ignore at Your Own Peril. Today we’ll discuss Offer Letters for Hourly Employees.
While offer letters are always good practice when hiring salaried employees, a new California law makes this the best way to comply with notification laws for hourly employees, as well. Labor Code §2810.5 requires a Notice of Pay Details be given to all employees within seven days of hiring or changes occur to those details. This is a new regulation as of 2012, and has many organizations scrambling, since they did not provide offer letters to hourly or non-exempt employees.
The notification must include:
1. the employee’s pay rate,
2. meal/lodging allowance, if any,
3. the employer’s payday,
4. the employer’s name and any “doing business as” names used by the company,
5. the employer’s full contact information,
6. the employer’s worker’s compensation insurer’s full contact information, and
7. other information the Labor Commissioner deems “material and necessary.”
Other information may be included, such as termination clauses, work hours, and expense reimbursement policies. The letter can also include or refer to the entire employee policy manual or other documents which must be signed upon hiring. It should be noted that, while many national and multinational companies include non-compete agreements, including them in the offer letter does not change the fact that non-compete covenants are illegal in California.
The most efficient way to ensure that these letters are generated and signed is by having them automatically generated as part of the hiring/new payroll process. Offer letters which are customized by job classification and other criteria may then be generated to comply with all legal requirements and employment terms. Should any future change in details be legally significant, it will trigger the generation of a new notification as per the labor code.
Because payroll services are inflexible when it comes to new and custom reports, an in-house system built by PACIFIC DATA Marketing is an alternative which can address new laws such as these when they first take effect, rather than months later. Anticipating this need, we already provide the service of offer-letter generation for both salaried and hourly employees, and can easily customize them to address any number of specific employment relationships.
If you’re looking for the peace of mind which comes from having an automatic system to address these legal requirements, contact us to arrange for a consultation.