In 2025, California enacted a series of new employment statutes that expand employer notice duties, tighten recordkeeping and pay transparency requirements, broaden certain leave and rehiring protections, and add new compliance considerations for tips, worker mobility agreements, and labor relations. Most changes take effect in 2026, with several provisions extending into 2027 and beyond.
Below is a practical, employer-facing summary (with action steps) you can adapt for policies, handbooks, offer letters, HR workflows, and manager training.
1) Required Employee Notices and Workplace Communications
SB 294: “Workplace Know Your Rights Act” annual notice and emergency contact rules
Key requirements (2026):
- Annual written notice to employees beginning February 1, 2026, covering core rights areas (including workers’ compensation, certain immigration-related protections, organizing/concerted activity rights, and constitutional rights in workplace law-enforcement interactions). The Labor Commissioner issued a model notice and plans supporting materials.
- Emergency contact designation and notification obligations tied to arrest/detention scenarios also begin in 2026.
Action items:
- Build the annual distribution into your HR calendar (onboarding plus a recurring annual cycle).
- Confirm you can provide the notice in the language used for work-related communications for that employee.
- Update onboarding packets to include emergency contact designation and internal procedures for any required notifications.
SB 617: Expanded Cal-WARN notice content (mass layoff, relocation, termination)
Effective January 1, 2026, Cal-WARN notices must include additional information, including whether you will coordinate services through the local workforce development board (or another entity), plus CalFresh information and specified contact details. If coordination is elected, it must occur within 30 days of the WARN notice.
Action items:
- Update your Cal-WARN templates now so they are compliant before any reduction-in-force planning becomes time-sensitive.
- Identify the correct local workforce development board contacts for each California location where you operate.
2) Compensation Practices: Tips, Pay Transparency, and Equal Pay
SB 648: Stronger enforcement tools for tip violations
SB 648 enhances enforcement by empowering the Labor Commissioner to investigate tip complaints and pursue citations or civil actions related to unlawfully taken or withheld gratuities.
Action items (especially important for hospitality and restaurants):
- Audit tip pool eligibility (exclude managers/supervisors) and confirm the distribution method is reasonable.
- Confirm credit card tips are remitted timely and in full, and ensure payroll timelines align with statutory requirements.
SB 642: Significant changes to pay transparency and equal pay enforcement
Effective January 1, 2026, SB 642:
- Revises “pay scale” to a good-faith estimate of what the employer reasonably expects to pay upon hire, not just a broad range for the role.
- Expands equal pay protections to address disparities involving an employee of “another sex,” including non-binary genders, and broadens “wages” for Equal Pay Act purposes to include more forms of compensation.
- Extends the limitations and recovery framework for Equal Pay Act claims (including a longer recovery lookback tied to the duration of the violation, subject to statutory caps).
Action items:
- Update job postings and internal pay scale disclosures to reflect “upon hire” estimates.
- Expand pay equity audits beyond base pay to include bonuses, allowances, and other compensation elements implicated by SB 642.
SB 464: Pay data reporting changes and data segregation
SB 464 strengthens pay data reporting by requiring, among other things, that demographic data collected for pay reporting be stored separately from personnel records starting January 1, 2026, and it moves toward more granular occupational classification reporting beginning with the 2026 reporting year due in May 2027.
Action items:
- Coordinate HRIS, payroll, and legal to ensure demographic data is segregated from personnel files in a defensible way.
- Confirm your pay data reporting vendor (if any) is ready for the expanded classifications and submission requirements.
3) Hiring, Offer Letters, and “Stay-or-Pay” Agreements
AB 692: Restrictions on “stay-or-pay” repayment provisions
Effective January 1, 2026, AB 692 restricts many arrangements that require repayment of employment-related costs when employment ends, with narrow exceptions (often requiring careful drafting). The statute also authorizes employee claims for the greater of actual damages or a specified statutory amount, plus attorneys’ fees and injunctive relief.
Action items:
- Review offer letters and side agreements for any repayment language tied to separation (training costs, relocation, “forgivable loans,” sign-on bonuses, etc.).
- If you rely on any exception structure, treat it as a high-scrutiny drafting project and align it with payroll and accounting practices.
4) Rehiring and Recall Obligations for Certain Hospitality and Service Employers
AB 858: Extended COVID-era recall/rehiring protections
AB 858 extends specified rehiring protections for covered hospitality and service industries (including hotels meeting the statutory thresholds and other covered employers) through January 1, 2027, continuing seniority-based recall and written offer procedures.
Action items:
- Confirm whether your properties fall within the covered categories and thresholds.
- Ensure you have a reliable roster of eligible laid-off employees and a compliant process for written offers, response deadlines, and documentation.
5) Personnel Records and Training Documentation
SB 513: Personnel file access expanded to education and training records
Effective January 1, 2026, personnel records subject to inspection requests include specified education and training records maintained by the employer.
Action items:
- Confirm training records capture the statutorily relevant fields (trainer, dates/duration, competencies, resulting certifications, etc.).
- Update your response protocol for personnel file requests to ensure complete production within statutory timeframes and to reduce penalty exposure.
6) Leaves of Absence and Victim-Protection Rules
AB 406: Expanded protections for victims of violence and related proceedings
Effective January 1, 2026, AB 406 expands protections for employees (and certain family members) who take time off to attend judicial proceedings related to qualifying crimes, prohibiting retaliation or discrimination for taking protected time off.
Action items:
- Update leave policies, manager training, and HR intake scripts to recognize protected requests and prevent retaliation claims.
- Ensure documentation and confidentiality practices align with the statute’s protections.
SB 590: Paid Family Leave for “designated persons” (later effective date)
Beginning July 1, 2028, SB 590 expands eligibility for California Paid Family Leave benefits to care for a seriously ill “designated person,” as defined.
Action item: Track this for medium-term planning, especially for policy definitions and leave administration vendors.
7) Wage and Hour and Worker Classification Updates
AB 751: Rest period rules for certain safety-sensitive petroleum/refinery positions
AB 751 extends certain rest period exemptions indefinitely for covered safety-sensitive roles, while preserving premium pay obligations when rest periods cannot be provided under the statute.
AB 1514: ABC test exemptions extended for manicurists and commercial fishers
AB 1514 extends specified ABC test exemptions for licensed manicurists and certain commercial fishers, shifting the analysis to the Borello standard for those exempt categories through the extended dates.
8) Website and Privacy Compliance
AB 566: “Opt Me Out Act” browser opt-out preference signals
Effective January 1, 2027, AB 566 requires browsers to offer an easy-to-configure mechanism that can automatically send opt-out preference signals to websites (with implementing authority and public guidance from the California Privacy Protection Agency).
Action items (now, not in 2027):
- Inventory your website privacy infrastructure and confirm it can recognize and honor opt-out preference signals as they become more common.
- Coordinate legal, IT, and marketing on a compliance roadmap that aligns with CCPA/CPRA obligations.
9) Labor Relations: Private-Sector Overlap Issues and Gig-Driver Organizing
AB 288: PERB authority expansion and current litigation posture
AB 288 attempts to expand PERB’s role into certain areas traditionally handled by the NLRB. As of early January 2026, there have been significant legal challenges and a federal court order that has limited or paused aspects of enforcement, creating a fast-changing compliance landscape.
Action item: Treat this as “watch closely.” If you have active union activity or ULP risk, coordinate strategy with labor counsel because federal preemption and enforcement posture are central.
AB 1340: Transportation Network Company Drivers Labor Relations Act
Effective January 1, 2026, AB 1340 creates a unionization and bargaining framework for certain non-employee gig drivers, administered by PERB, including periodic reporting by covered platforms.
10) Training and Other Risk Areas
SB 303: Bias mitigation training safe harbor concept
SB 303 clarifies that an employee’s good-faith self-assessment or acknowledgment of personal bias during employer-provided bias mitigation training does not, by itself, constitute unlawful discrimination under FEHA.
AB 250: Two-year revival window for certain adult sexual assault claims involving “cover-ups”
AB 250 creates a revival window allowing certain otherwise time-barred claims to be filed between January 1, 2026 and December 31, 2027, focused on cases involving alleged institutional cover-ups, and generally excluding public entities.
Action items:
- Review document retention, complaint intake, and investigations protocols.
- Reassess confidentiality practices and legacy agreements in light of evolving public-policy limits.
Practical Compliance Checklist for 2026
Most California employers should prioritize:
- SB 294 rollout: annual rights notice distribution, language compliance, and emergency contact workflows.
- Offer letter and agreement cleanup: remove or restructure “stay-or-pay” repayment provisions to align with AB 692.
- Personnel file process updates: ensure training/education records are maintained and producible under SB 513.
- Pay transparency and pay equity audit: update pay scale practices and broaden compensation equity review under SB 642.
- Pay data reporting readiness: implement demographic data segregation and prepare for upcoming classification/reporting expansions under SB 464.
- Hospitality operators: confirm recall/rehire compliance timelines and documentation under AB 858.
- Tip practices (if applicable): tighten tip handling and tip pool controls under SB 648 enforcement changes.
- Leave and retaliation training: update policies and manager training for AB 406.
- Labor relations watchlist: track AB 288 litigation and enforcement developments.
- Privacy roadmap: plan ahead for AB 566’s 2027 browser opt-out preference signals.
This article is for informational purposes only and does not constitute legal advice. Because employment laws and their interpretations change frequently, consult counsel regarding your specific facts and compliance obligations.
