California’s 2023-2024 legislative session just concluded, and California employers will want to be aware of the following new employment laws that take effect January 1, 2025, unless otherwise noted:
Social Compliance Audits. Effective January 1, 2025, AB 3234 adds sections 1250-1251 to the Labor Code and requires employers to post on their internet website a report detailing their compliance with child labor laws if the employer has voluntarily subjected itself to a “social compliance audit” (which is defined to mean a voluntary, nongovernmental inspection or assessment of an employer’s operations or practices to evaluate whether the operations or practices are in compliance with state and federal labor laws, including, but not limited to, wage and hour and health and safety regulations, including those regarding child labor). The required internet posting is limited to findings related to child labor law compliance. The detailed reporting requirements are set forth in the statute (Labor Code 1251).
Local Enforcement of Non-Discrimination Laws. Under SB 1340, effective January 1, 2025, cities and counties will be able to enforce local non-discrimination laws that cover employment discrimination (as well as discrimination by businesses) that is also covered by FEHA and the Unruh Civil Rights Act. More specifically, if a complainant has filed a complaint with the Civil Rights Department (formerly the DFEH) and the Department has issued a right to sue notice, a city or county may undertake local enforcement action pursuant to a similar local law so long as that action is within the time period for the complainant to bring an action. If a city or county pursues local enforcement, the statute of limitations for the complainant to file a lawsuit is tolled during the period of local enforcement.
CROWN Act Amendment. Effective January 1, 2025, AB 1815 amends FEHA very slightly. In current form, FEHA defines “race” to include traits “historically” associated with race, including hair texture and protective hair styles. The amendment deletes the word “historically” as a modifier to “associated with race” because that term was considered vague.
Los Angeles County Fair Chance Ordinance. Los Angeles County’s Fair Chance Ordinance took effect September 3, 2024. The County has begun to publish compliance resources on its website, including the required Poster, Frequently Asked Questions, and a Fact Sheet. The County states that sample forms (notices, individualized assessment, adverse action forms) and “Rules and Regulations” are “coming soon.”
Captive Audience Meetings. Governor Newsom has signed SB 399 into law, effective January 1, 2025. This new law adds section 1137 to the Labor Code and prohibits employers from subjecting or threatening to subject an employee to discharge, discrimination, retaliation, or any other adverse action because the employee declines to attend an employer-sponsored meeting or affirmatively declines to participate in, receive, or listen to any communications with the employer or its agents or representatives, the purpose of which is to communicate the employer’s opinion about religious or political matters. “Political matters” includes the decision to join or support a labor organization. An employee who is working at the time of the meeting and elects not to attend the meeting must continue to be paid while the meeting is held.
Freelance Worker Protection Act. SB 988, which takes effect January 1, 2025, requires independent contractor agreements to be in writing and contain the following information:
(1) The name and mailing address of each party.
(2) An itemized list of all services to be provided by the freelance worker, including the value of those services and the rate and method of compensation.
(3) The date on which the hiring party shall pay the contracted compensation or the mechanism by which the date shall be determined.
(4) The date by which a freelance worker shall submit a list of services rendered under the contract to the hiring party to meet the hiring party’s internal processing deadlines for purposes of timely payment of compensation.
Written agreements must be retained for at least 4 years. If the hiring entity fails to pay the contractor within the time provided for in the contract, the contractor can recover damages of up to two times the amount owed for the work. If the hiring entity fails to provide a written contract, the rate of pay owed is the amount the contractor reasonably understood to be owed for the work. The contractor may also recover a penalty of $1,000.
Amendment of FEHA to Prohibit “Combined” Discrimination. Governor Newsom has signed SB 1137 into law, effective January 1, 2025. This new law amends FEHA to prohibit discrimination toward an employee based not only a single protected trait but also based on a combination of protected traits (or perceived protected traits).
Requiring a Driver’s License. Effective January 1, 2025, SB 1100 amends FEHA to make it an unlawful employment practice 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 (1) the employer reasonably expects driving to be one of the job functions for the position; and (2) the employer reasonably believes that satisfying the job function using an alternative form of transportation would not be comparable in travel time or cost to the employer.
Time Off for Jury Duty, Victims of Crime. Effective January 1, 2025, AB 2499 makes existing requirements to provide time off for jury duty and for victims of crime (employers with 25+ employees) part of FEHA instead of the Labor Code. It also expands California crime victim leave by expanding the definitions of qualifying acts of violence for which leave may be taken to includes things like being subjected to a threat of violence and by expanding the types of family members for whom leave may be taken. The new law also amends California’s statewide sick leave law (Labor Code 246.5) to allow employees to use paid sick leave if they or a family member are victims of crime or a qualifying act of violence. The state will issue updated posters reflecting these revised rights for victims and for uses of paid sick leave.
California Paid Family Leave EDD Benefit. AB 2123, which takes effect January 1, 2025, amends the paid family leave insurance program to eliminate the ability of employers to require that an employee use up to two weeks of accrued vacation prior to becoming eligible to access wage replacement benefits through the paid family leave insurance program.
Extension of PAGA Exemption for Construction Industry. Governor Newsom has signed AB 1034 into law, extending the PAGA exemption for construction industry employees covered by collective bargaining agreements that meet certain requirements to 2038.Healthcare Worker Minimum Wage Increases. Last year, California passed a law providing increases in the minimum wage for healthcare employees. The increases were supposed to take effect earlier this year but they were delayed as part of state budget negotiations. Yesterday, it was announced that the increases will take effect beginning October 16, 2024.