The California Chamber of Commerce is inviting members of the business community to join the opposition to a bill that could expose employers to lawsuits for workplace decisions many years after the fact.

CalChamber-opposed AB 793 (Jones; D-Sacramento) imposes an unfair and unreasonable litigation burden on employers by establishing a virtually unlimited statute of limitations for many types of workplace lawsuits. AB 793 is scheduled to be heard in the Assembly Judiciary Committee on April 21.

Contact Laurie Lively at laurie.lively@calchamber.com if you would like your company to be added to the opposition coalition letter.

AB 793 revises the statute of limitations law for any workplace claim or lawsuit relating to compensation so that the statute of limitations is renewed each time an employee’s compensation is “affected,” including each time it is paid. AB 793 is not limited to any particular statute, and thus would apply to any California law having an impact on employers, including but not limited to the Labor Code and the Fair Employment and Housing Act.

AB 793 could in effect eliminate the statute of limitations for lawsuits challenging any California employer decision that affects pay or benefits. This would encompass a broad array of workplace decisions, including hiring, job evaluations and promotions. For example, if an employee believes that he or she was denied a pay increase at the time of an annual performance evaluation, each paycheck affected by that one decision would restart the statute of limitations, regardless of whether 10, 15 or 20 years had transpired.

AB 793 is far more expansive than federal law. Although AB 793 is modeled after the federal Lilly Ledbetter Fair Pay Act of 2009, enacted this year, there are major differences. One difference is that AB 793 applies to any California statute, while the federal law was limited to certain statutes. In addition, California’s labor and employment laws are more expansive than federal laws. Thus, application of the federal “Ledbetter” law to California’s statutory framework will result in far greater liability exposure for California employers.

The bill also violates the public policy behind statutes of limitations — which is to ensure that a defendant is not faced with stale claims that cannot be defended due to the passage of time and the dissipation of fresh and available evidence. In addition, statutes of limitation encourage employees and employers to address the alleged wrongdoing when it first takes place.

Finally, AB 793 is not limited to prospective claims and therefore appears to retroactively apply to pending cases and could breathe life into stale claims not yet filed.

If passed, AB 793 would further destroy the balance between employer and employee interests that should be maintained when the Legislature creates workplace laws. Disrupting this balance harms both employers and employees when the weight and cost of too much litigation causes employers to reduce workforces, close their doors or relocate to states with less hostile legal systems.

Again, contact Laurie Lively at laurie.lively@calchamber.com if you would like your company to be added to the opposition coalition letter.