USA – CALIFORNIA Law and Practice Contributed by: William C. Martucci, Laura M. Booth, Ashley N. Harrison and Carrie A. McAtee, Shook, Hardy & Bacon LLP
employer. California state law specifically recognises a union’s right to enter into a CBA as long as that agreement is not against public policy. The process of negotiating and formalising a CBA is governed by the NLRA.
nation for cause will be governed by the employee’s respective agreement. 7.4 Termination Agreements Termination agreements, or severance agreements, are generally permitted under California law with a few caveats. Severance agreements cannot waive rights afforded by California’s FEHA or certain federal rights (eg, rights set forth by the Age Discrimination in Employment Act). Under California Government Code, Section 12964.5, employers are prohibited from including provisions that restrict employees from disclosing information about unlawful acts in the workplace, such as harass - ment or discrimination. If a severance agreement con - tains a non-disparagement or confidentiality clause, then it must include language substantially similar to: “Nothing in this agreement prevents you from discuss - ing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination or any other conduct that you have reason to believe is unlawful.” Severance agreements must notify employees of their right to consult an attorney and provide a reasonable time period of at least five business days to review the agreement. Under federal law, if an employee is over 40, an employee must be provided at least 21 days to review and eight days to revoke, in order to waive age discrimination claims pursuant to the ADEA and Older Workers Benefit Protection Act (OWBPA). Employees may voluntarily waive these review periods and sign agreements earlier, but such a waiver must not be induced by fraud, misrepresentation, or threats. 7.5 Protected Categories of Employee There is no category of employee that is protected from termination in California. However, California rec - ognises a number of protected classes for employ - ees under FEHA and the California Family Rights Act (CFRA). Employers may not terminate an employee based on protected characteristics. The common pro - tected categories for employees in California are race, religion, colour, national origin, ancestry, physical dis - ability, mental disability, medical condition, marital status, sex, age, and sexual orientation.
7. Termination 7.1 Grounds for Termination
What constitutes grounds for termination in Califor - nia varies depending on the type of employment held by the worker. Most California employees are at-will employees and may be terminated without cause for any non-discriminatory reason under California Labor Code, Section 2922. For employees subject to a CBA, the employer must comply with the bargaining agreement when terminating an employee, which may include notice periods, improvement plans, a tiered warning system, etc. And, for employees that have an employment agreement – whether written, oral, or implied – the employer may have to show “good cause” in order to terminate employment. 7.2 Notice Periods California does not have mandatory notice provi - sions for terminating at-will employees. Employees who have employment agreements or are subject to CBAs may be entitled to notice before termina - tion, which would be governed under their respective agreements. For large-scale layoffs, California’s Worker Adjust - ment and Retraining Notification (WARN) Act requires employers with 75 or more employees to provide 60 days’ notice before conducting mass layoffs, plant closures, or relocations affecting 50 or more employ - ees. This state law supplements the federal WARN Act by applying to smaller layoffs and employers than those covered by federal law. The California WARN Act applies even to temporary layoffs lasting less than
six months, as interpreted by courts. 7.3 Dismissal for (Serious) Cause
California does not require cause for terminating at- will employees. If the employee has a contract or is subject to a collective bargaining agreement, termi -
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