California Governor Gavin Newsom signed a number of new laws that may affect California employers. This summary doesn’t review all of the new state laws that effect employers, but instead, looks at the most significant in terms of scope and impact of employers with business operations in California.
All of these laws are effective January 1, 2025 unless otherwise indicated.
- AB 224. Under the ABC Test for determining independent contractor status as set out by the California Supreme Court in Dynamex Operations W. Inc. v. Superior Court (2018), there’s a presumption that a worker who performs services for a hiring entity is an employee and not an independent contractor.
- AB 1815. This new legislation removes the term “historically” from the definitions of race, thus defining race to include traits associated with race, including, but not limited to, hair texture and protective hairstyles (such as braids and twists), and would add those definitions for “race” and “protective hairstyles” to the Unruh Civil Rights Act.
- AB 2011. This new law expands the small employer family leave mediation pilot program to include resolution of alleged violations of reproductive loss leave requirements. Employees can’t file a civil action until mediation is finished or deemed to be unsuccessful, and the statute of limitations on the employee’s claim is paused during that time.
- AB 2123. Existing law authorizes an employer to require an employee to take up to two weeks of earned but unused vacation before, and as a condition of, the employee’s initial receipt of these benefits during any 12-month period in which the employee is eligible for these benefits. This bill would make that authorization and related provisions inapplicable to any disability commencing on or after January 1, 2025.
- AB 2288 and SB 92 deal with PAGA reforms, which went into effective June 19, 2024). We discussed this in an earlier post.
- AB 2319. The Act requires hospital and alternative birth centers to provide annual, evidence-based implicit bias training to care staff. The training is designed to speak to unconscious biases that may impact the quality of care provided to pregnant women of color. The initial basic training for the implicit bias program must be done by June 1, 2025, for current health care providers, and within six months of their start date for new health care providers, unless they fall within an exemption. There’s also a requirement that employers provide the Attorney General with proof of compliance with training, beginning February 1, 2026.
- AB 2499. This bill transfers certain requirements regarding jury duty, court duty and time off for victims of crime from the Labor Code to the Fair Employment and Housing Act (FEHA). The legislation also provides a prohibition for employers with 25 or more employees on discriminating or retaliating against an employee for taking time off for various reasons related to a family member’s being the victim of a qualifying act of violence.
- SB 399. The new law prohibits covered employers from subjecting, or threatening to subject, an employee to termination of employment, discrimination, retaliation, or any other adverse action because he or she doesn’t attend an employer-sponsored meeting or affirmatively declines to participate in, receive, or listen to any communications with the employer to communicate its opinion about religious or political matters.
- SB 988 is the Freelance Worker Protection Act, which our firm discussed in a blog last month.
- SB 1090. This law amends the existing law to require employers, for purposes of unemployment compensation disability benefits, to issue the initial payment for those benefits within 14 days of receipt of the claimant’s properly completed first disability claim or as soon as eligibility begins, whichever is later. The law also provides that workers can file a claim for disability benefits or paid family leave up to 30 days in advance of the first compensable day with respect to the claim, applies the same initial payment issuance schedule applicable to unemployment compensation disability benefits to the paid family leave program, and repeals the requirement that eligible workers receive benefits generally in accordance with unemployment and disability compensation law.
- SB 1100. The Fair Employment and Housing Act (FEHA) prohibits employment and housing discrimination, including discrimination based on national origin. This has been defined to include discrimination on the basis of possessing a driver’s license granted according to existing law that requires the DMV to issue an original driver’s license to an individual who’s unable to submit satisfactory proof that the applicant’s presence in the U.S. is authorized under federal law. The law makes it illegal for an employer to include a statement in a job advertisement, posting, application or other material that an applicant must have a driver’s license unless the employer: (i) reasonably expects the duties of the job to require driving; and (ii) reasonably believes that satisfying that job function using an alternative form of transportation wouldn’t be comparable in travel time or cost to the employer.
- SB 1340. This law states that while the FEHA is aimed at regulating discrimination in employment and housing, it doesn’t restrict the application of the Unruh Civil Rights Act. That law prohibits businesses from operating with discriminatory practices. In addition, SB 1340 also says that nothing in the act limits or restricts efforts by any city, county or other political subdivisions of the state to enforce a local law that is at least as protective as FEHA.
Finally, note that the minimum wage in California is increasing to $16.50/hour on January 1st for all employers, no matter the number of workers an employer has. Recently, California voters rejected a measure that would have raised minimum wage to nation-high $18 per hour. In addition, many cities and local governments in California have enacted minimum wage ordinances that go above the state minimum wage.
Takeaway
Employers that operate in California should understand these new laws and the way in which they may impact their businesses.
Contact us to discuss any compliance questions and to determine if your present employment policies should be updated or whether new employment policies should be drafted.