Growing concern about warehouse employers use of work quotas, including quotas for how quickly warehouse workers must complete tasks, or what percentage of workers shift must be “time on task”, has driven three states to pass laws limiting warehouse centers quotas. The laws also require written disclosure of quota data to employees, prohibit using non-disclosed quotas against employees and protect against retaliation. 

Quotas affecting warehouse workers in California, New York, and Washington (when the WA law goes into effect in 2024) must be disclosed to workers. Quotas must also be limited to not prevent workers from taking rest breaks, meal breaks, bathrooms breaks, or prevent compliance with health and safety standards. 

Concern for warehouse workers has mounted after news stories and journalist investigations regarding increasing amounts of warehouse injuries, such as heat injures of warehouse workers. For information on the warehouse quota laws, see below.  If you have been injured or have questions about quotas, retaliation, health and safety compliance, or other employment matters, please contact our employment lawyers at info@schneiderwallace.com, 1-800-689-0024 or 1-415-421-7100. We offer free and private legal consultations. 

CA Warehouse Quota Law – Assembly Bill 701 

Effective January 1st, 2022, California’s Warehouse Quota Law introduces new regulation for warehouse distribution center’s use of quotas. The legislation is aimed to ensure fair working conditions and to protect employees from potential health and safety violations. 

Provisions of AB 701: 

1. Locations: The law covers warehouse distribution centers as defined by the North American Industry Classification System (NAICS) codes. Included: General Warehousing and Storage, Durable Goods Merchant Wholesalers, Nondurable Goods Merchant Wholesalers, and Electronic Shopping and Mail-Order Houses. Excluded: Farm Product Warehousing and Storage. 
2. Employers:  The law covers employers with 100 or more employees in a single warehouse or 1,000 warehouse employees in California. Included in staff totals are staffing agency hires if they are under control of the warehouse operator. 
3. Disclosure: As of January 1st 2022, employers must provide written descriptions of all quota systems to employees. The details should describe the task and timeframe of quotas and potential repercussions of not meeting a quota. All new hires must receive disclosures at time of employment. 
4. Repercussions or Adverse Employment Action:  Any employer action that negatively impacts employment, including negative reviews, are considered repercussions. Reduction in pay, reduction in hours, termination, and negative reviews are all adverse employment actions. 
5. Quota Limitations:  Quotas cannot make it harder for employees to take meal breaks, rest breaks, use the bathroom, or comply with health and safety regulations or standards. Quotas that impact these are illegal. 
6. Employee Rights: Employees can request copies of their data for the last 90 days, the quotas they are subject to and records on their performance. Employers have 21 days to comply. 
7. No Retaliation: Employers are not to retaliate against request for data, and employers are not to retaliate against employees who fail to meet an undisclosed quota. A penalty of $750 will be applied to employers who do not meet the required data disclosure requests in a timely fashion. 

How does the California law define a quota? 

A quota in the California law is a “work standard under which an employee is assigned or required to perform at a specified productivity speed, or perform a quantified number of tasks, or to handle or produce a quantified amount of material, within a defined time period and under which the employee may suffer an adverse employment action if they fail to complete the performance standard.” 

Examples from the California Department of Industrial Relations include the number of packages an employee must process in a specific time, clearing a conveyor belt based on belt speed (the belt speed sets the quota), clearing all incoming inventory in a shift, and filling a set number of containers in a shift. 

Washington Warehouse Quota Law – House Bill 1762 

The Washington Warehouse Quota Law, House Bill 1762, will go into effect on July 1st, 2024. 

Provisions of House Bill 1762: 

1. Locations: Warehouse distribution centers, including the NAICS codes 493 for warehouse and storage, 4423 for durable good merchant wholesalers, 424 for non-durable good merchant wholesalers, and 454110 for electronic shopping and mail-order houses. This matches California. 
2. Employers: Those who have 100 non-exempt employees in a single Washington warehouse location, or 1,000 in the state. All employees of agencies or affiliated companies are to be counted in these totals. 
3. Disclosures: All new hires must be given written information describing quotas and their use including potential repercussions. Changes to quotas should be shared with employees in written communications within two business days of the change. 
4. Quota Limitations:  Quotas cannot make it harder for employees to take meal breaks, rest breaks, use the bathroom, or comply with the Washington Industrial Safety and Health Act. Quotas should include reasonable travel time to rest break locations or bathrooms. 
5. Data Retention: Employers must maintain records of individual and aggregated employee performance. Data must be preserved for the duration of employment until six months post-employment. In cases of adverse action due to quota non-compliance, records must be retained for a minimum of three years. 
6. Employee Rights: Employees can request, free of charge, quota-related information, including personal and aggregated work speed data. Former employees can access this data up to three years post-separation. 
7. Protection and Enforcement: The law safeguards employees against retaliation for exercising their rights or raising concerns about quotas. A presumption of retaliation exists if adverse action is taken within 90 days of protected activity. The Washington Department of Labor & Industries is responsible for enforcing the law. Penalties for violations range from $1,000 for first-time offenses to $10,000 for repeat violations. 
8. Penalties: Employers face civil penalties, with repeat offenders incurring higher fines. Additionally employers may be required to compensate employees for rest or meal period violations. 

How does the Washington law define a quota? 

The Washington law defines a quota as: 

“a work performance standard, whether required or recommended, where: (a) an employee is assigned or required to perform at a specified productivity speed, or perform a quantified number of tasks, or to handle or produce a quantified amount of material, within a defined time period and under which the employee may suffer an adverse employment action if they fail to complete the performance standard; or (b) an employee’s actions are categorized between time performing tasks and not performing tasks, if the employee may suffer an adverse employment action if they fail to meet the performance standard.” 

New York Warehouse Worker Protection Act 

Similar to other states, New York passed the Warehouse Worker Protection Act which has taken effect as of June 19th, 2023. 

The act creates new legal requirements for New York employers in larger warehouse distribution centers, and grants New York warehouse employees new rights. 

Provisions of The Warehouse Worker Protection Act: 

1. Locations: Similar to the above laws, the law covers warehouses under NAICS codes for warehouse and storage, merchant wholesalers of durable and non-durable goods, electronic shopping and mail-order houses, and the NY law also includes couriers and express delivery service warehouses. Like the other states, the law excludes farm product warehousing and storage. 
2. Employers: The law covers warehouse centers with 100 or more non-exempt employees, or employers with 1,000 such employees in the state. All employees of agencies or affiliated companies are to be counted in these totals. Drivers and couriers to the facility are not to be counted. 
3. Disclosures: Written disclosure of quotas must be provided to employees including a description of potential adverse employment actions, which can include termination, reduced pay, reduced hours, or negative reviews. Employers must update written disclosure within 30 days. Employees are to provide updated disclosure to new employees at time of hire. 
4. Quota Limitations: Quotas cannot be used for adverse employment actions if not disclosed to employees. Quotas must not prohibit or delay use of restrooms, rest breaks, meal breaks, or health and safety standards. 
5. Employee Rights: Employees can request a copy of quotas and their personal data of quota performance at any time. Employers must provide the data within 14 days. The data is to include quota data from the last 90 days of an employees personal work speed. Former employees are allowed one request for this data. Written disclosures must be provided in a language the workers understands. 
6. No Retaliation: The law protects workers from requesting data about quotas, and complaints about quotas to the Department of Labor. Employers will be presumed to have retaliated without proof of no retaliation if they take adverse action against an employee within 90 days of a request for records or complaints to the Department of Labor. 
7. Record Retention: Employers are to hold data for three years to comply with employee or Department of Labor quota data requests. 

How does the New York law define a quota? 

The Warehouse Worker Protection Act defines a quota as: 

“A quota is a work standard that requires an employee to perform at a specified productivity speed, complete a quantified number of tasks, handle or produce a quantified amount of material within a defined time-period, or meet a similar type of performance standard for which an employee may be disciplined if they fail to complete it.   A quota also exists where an employee’s actions are categorized between time performing tasks and not performing tasks, and the failure to complete a task performance standard or recommendation may have an adverse impact on the employee’s employment or other conditions of employment.” 

Warehouse Worker Labor Lawyers 

Schneider Wallace Cottrell Konecky LLP is a well-respected national employment litigation law firm established in 1993. Our trial attorneys represent individual plaintiffs and classes in complex employment-related litigation. We often appear before in the federal and state courts to recover damages and to protect the right to work in a safe, harassment and discrimination-free environment while receiving all due wages and benefits.