California New Employment Laws 2025
As California wraps up its legislative season, employers in our state have less than three months to prepare for a wave of new employment-related legislation. It is therefore a good time for you to review your employment policies, practices, and procedures to ensure compliance with the new changes noted below, all of which are effective January 1, 2025, unless otherwise noted.
Broadened Discrimination Protections: Embracing Overlapping Identities
California’s new SB 1137 takes workplace discrimination protection to the next level by recognizing how multiple aspects of a person’s identity can overlap. It expands protections under the Fair Employment and Housing Act (FEHA) to cover:
Any combination of protected characteristics (like race, gender, or age).
Situations where someone is perceived to have one or more of the protected characteristics.
Cases where someone is connected to a person who is perceived to have one or more protected traits.
What Employers Should Do:
Work with counsel to update employee handbooks and policies to reflect these broader protections.
Train managers to spot and understand how these overlapping protections play out in the real world, especially when it comes to accommodations and other workplace considerations.
This new law is about keeping up with how real life works—people don’t fit into single boxes, and the law now reflects this reality.
Employers Can No Longer Require Employees to Use Paid Vacation Time Before Receiving Paid State Family Leave Benefits
Paid Family Leave (PFL) provides wage replacement when employees take time off to care for a sick family member, bond with a new child, or support military family members. Currently, employers can require employees to use up to two weeks of accrued vacation or paid time off before they can receive PFL benefits. Effective January 1, 2025, employers can no longer force employees to use any accrued or available vacation or paid time off before receiving PFL benefits from the state or from an approved employer-sponsored plan.
What Employers Should Do:
Review and update leave policies, including vacation and paid time off, to comply with the new law.
Assess if/how this change will impact the coordination of leave benefits and continued health coverage during approved leave.
Consult with counsel to fully understand the impact of this new law and ensure smooth implementation of any necessary policy adjustments.
With this change, employees can now access PFL benefits directly, without burning through their vacation time first.
New Limits on Driver’s License Requirements in Hiring
SB 1100 restricts employers from requiring that a job applicant have a valid driver’s license unless two conditions are met: (i) driving is a reasonable part of the job duties, and (ii) there are no reasonable alternative transportation options (such as ride-hailing, taxi, carpooling, bicycling, or walking) that are comparable in terms of time and cost.
What Employers Should Do:
Review job descriptions to determine which roles require driving.
Update hiring materials, such as job applications, announcements, and advertisements, to ensure compliance with the new restrictions.
Employers now need to carefully monitor when they ask for a driver’s license and ensure that they do so only when driving is essential to the role for which a license is required.
Please note that when driving is an essential part of the job function, it is good practice to require that the applicant both have a valid driver’s license and a clean record that would enable the company to secure insurance for the applicant.
New Limits on Mandatory Meetings: Californa Worker Freedom from Employer Intimidation Act
SB 399 prevents employers from forcing employees to attend employer-sponsored meetings that discuss religious or political matters under threat of discharge, discipline, or some other adverse employment action (such as discrimination and retaliation). “Political matters” includes anything related to political elections, political parties, legislation, regulation, and/or decisions to join or support political or labor organizations.
There are some narrow exceptions to this law, and employers may still communicate with employees about subjects that are legally required or necessary to perform duties. Violations can lead to civil lawsuits, penalties, or enforcement actions by the Labor Commissioner.
What Employers Should Do:
Review and update handbooks and policies to align with this new law.
Train managers to ensure they understand the restrictions and requirements.
Consult with legal counsel to ensure that any workplace meetings on sensitive topics are clearly voluntary, and clearly communicate and have documentation showing the voluntary nature of such meetings.
Consider this another reason why employers should tread carefully when discussing religious or political matters (including communications about union/labor organizations) with employees—the key is the voluntary nature of employee participation.
Cal/OSHA Now Covers Household Domestic Services
Historically, household domestic services were not considered "places of employment," meaning they were excluded from Cal/OSHA's safety regulations. Now, Cal/OSHA will oversee workplace safety for most household domestic services, effective July 1, 2025, with a few exceptions:
Publicly funded domestic services, including those with a shared cost arrangement.
Family daycare homes, as defined by law.
Private individuals who employ workers in their own homes for typical household tasks such as cleaning, cooking, or caregiving.
What Employers Should Do:
For those employing domestic workers outside the above-listed exceptions, be ready to comply with Cal/OSHA’s safety regulations starting in July 2025.
This change extends workplace safety rules into the home in many circumstances, ensuring protections for domestic workers.
New Rules for Voluntary Social Compliance Audits
AB 3234 requires California employers that conduct voluntary social compliance audits (such as reviews of their operations to check compliance with labor laws like wage, hour, and safety regulations) must now publicly share their results. Specifically, if these audits include any review of compliance with child labor laws, the employer is required to post a clear and visible link on their website to a report detailing the findings.
What Employers Should Do:
If conducting a social compliance audit, ensure the audit report meets the standards set forth in this new law.
Consult with counsel to make sure reporting requirements, especially related to child labor compliance, are correctly followed.
New Protections for Freelance Workers
SB 988, the Freelance Worker Protection Act, sets new rules for businesses hiring independent contractors for services worth $250 or more. Under the new law, these engagements must include a written agreement with key terms such as the names of all parties, an itemized list of services, compensation terms, and payment deadlines.
Employers must pay freelancers by the agreed-upon date, and no later than 30 days after services are completed. The law also protects freelancers from discrimination and retaliation and allows them to sue for damages for violations—up to $1,000 for failure to provide a written contract and up to twice the amount of unpaid wages.
What Employers Should Do:
Review and update independent contractor agreements to ensure they meet the new requirements.
Train managers and payroll staff on the new rules, especially regarding payment deadlines.
This law gives freelance workers more security but also aligns their rights more closely with the rights of employees. This requires employers to be more vigilant when hiring independent contractors and making sure their contracts and payment practices are airtight.
PAGA Exemption Extension for Unionized Construction Employers
AB 1034 extends to January 1, 2038, the current law that exempts unionized construction workers from lawsuits under California’s Private Attorneys General Act (PAGA). However, there is a catch: this extension only applies if the applicable collective bargaining agreement (CBA) includes specific terms, such as an explicit waiver of PAGA rights.
What Construction Industry Employers Should Do:
Review CBAs with legal experts to ensure they meet the conditions for the PAGA exemption.
Confirm that contracts include the required language to benefit from the extended exemption.
This extension offers employers of unionized construction workers some relief, but only if their CBAs are compliant.
Expanded Protections for Jury Duty, Court, and Victim Leave
AB 2499 boosts time-off protections for employees, making it easier for them to take leave when they or their family members are impacted by crime. The law expands the list of crimes that qualify for protected leave and allows employees to take time off to support certain family member victims, not just for themselves.
Some key updates include:
Employees can use vacation, paid time off, sick leave, or other available leave for these absences.
The law shifts from using the term “crime or abuse” to “qualifying acts of violence,” which includes domestic violence, sexual assault, stalking, and threats involving weapons or bodily harm.
Employers can limit time off to 12 weeks for employees directly impacted and up to 10 days when helping family members, with exceptions for situations like the death of a family member.
Employees can now file civil lawsuits for violations, giving them more legal power if denied leave.
What Employers Should Do:
Review and update leave policies to align with the new law.
Train managers to recognize situations where employees may need protected leave.
Consult with counsel to understand the revised terminology and notification rules before updating policies
These changes provide stronger protections for employees, ensuring they have the support their need for themselves and their families during tough times.
If you have any questions or need assistance revising your handbooks and policies to comply with these new laws, please reach out to us. We are here to help you navigate these changes and ensure your business is compliant with California’s increasingly employee friendly legislative landscape.