A vestige of the pandemic, California hospitality workers laid off due to COVID have continuing and dramatically expanded comeback rights under SB 723.  See: What’s New in 2024: Extended Comeback Rights: Hospitality Workers to Receive Longer Rehire Protection (November 10, 2023).  Such rights extend not only to workers formerly employed by hotels, clubs, event centers, and airport-related hospitality providers, but also to janitorial and security guard companies.

The law imposes new – and very stringent — burdens on employers hiring after any layoff (thus, even a termination of a single person) since March 4, 2020 for “a lack of business, reduction in force, or other economic, nondisciplinary reason.” Unless management can provide adequate evidence otherwise, that separation will be presumed to be “due to a reason related to the COVID-19 pandemic.”

If that presumption holds, then for any job opening in 2024 and through 2025, “[w]ithin five business days of establishing [the] position, [the hospitality industries] employer shall offer its laid-off employees in writing, either by hand or to their last known physical address, and by email and text message to the extent the employer possesses such information, all job positions that become available … for which the laid-off employees are qualified. A laid-off employee is qualified for a position if the employee held the same or similar position at the enterprise at the time of the employee’s most recent layoff with the employer.”

[A “laid-off employee” is “any employee who was employed by the employer for 6 months or more and whose most recent separation from active employment by the employer occurred on or after March 4, 2020.”]

“The employer shall offer positions to laid-off employees in an order of preference … If more than one employee is entitled to preference for a position, the employer shall offer the position to the laid-off employee with the greatest length of service based on the employee’s date of hire for the enterprise.

“A laid-off employee who is offered a position pursuant to this section shall be given at least five business days, from the date of receipt, in which to accept or decline the offer. A “business day” is any day except Saturday, Sunday, or any official state holiday. An employer may make simultaneous, conditional offers of employment to laid-off employees, with a final offer of employment conditioned on application of the [required] preference system …”  Emphasis supplied.

Violations can be costly.  Employers are subject to a $100 penalty per employee and $500 in damages per employee per day the violation is not cured.

Take-Aways: 

Employers in the above hospitality industries must be especially careful on their hiring procedures, minimally over the coming two years.  Best practices include thorough documentation of the basis for any employee layoff since the law’s March 4, 2020 pandemic start date – whether in any part for COVID or, alternatively, purely for other reasons. For any COVID-based layoff or for lack of such documentation otherwise, management must take care to follow such employee’s “rehiring” notice and acceptance rights summarized above and as contained in the full details of the new law.

For further information, please contact Tim Bowles, Cindy Bamforth or Helena Kobrin.

See also:

• New Year, New Leaf – Workplace Policy Handbook & Forms for 2024 (January 5, 2024)
• Friday, February 23, 2024 – Annual Seminar for Employers Covering Employment Legal Essentials and New Workplace Laws (December 29, 2023)
• Former Workers Get First Shot: 3.3 Million Reasons to Hire Back Pre-Pandemic Hospitality Employees (March 11, 2022)
• Comeback Trail: Hotels, Security Services and Others Must Offer Openings to Pandemic-Affected Former Staff (December 10, 2021)

Helena Kobrin
Timothy Bowles
February 2, 2024