California employment law changes for 2026 reshape workplace notices, pay rules, leave rights, layoffs, labor standards, and employer compliance duties. See how new state laws affect employees, contractors, websites, personnel records, union issues, and business policies across California.
By Brad Nakase, Attorney
Email | Call (800) 484-4610
Have a quick question? We answered nearly 2000 FAQs.
California’s employer requirements were greatly expanded and reformed by over a dozen measures enacted by Governor Gavin Newsom in 2025. The majority of these new California employment laws take effect in 2026. Certain parts continue into 2027 and beyond.
They also create new supplementary workplace rights notifications, increase leave and rehiring safeguards, expand personnel records and pay reporting standards, and modify wage and hour, freelance contractor, online presence, and labor relations regulations.
An overview of the major developments that will impact California employers in 2026 is discussed here.
1. Know Your Rights Act Notices in the Workplace: SB 294
Employers are required to give workers a formal Workplace Know Your Rights Act Notice every year beginning on 1st February 2026. The Labor Commissioner will produce a template notice by 1st January 2026, and instructional videos by 1st July 2026.
Content of the Required Notice
The notice must explicitly outline the rights of employees with regard to:
2. Revised Notice Standards for Mass Layoffs, Terminations, or Relocations under the WARN Act 2026: SB 617
Under the Cal-WARN (California Worker Adjustment and Retraining Notification Act), companies that execute mass layoffs, terminations, or relocations must include additional data in their written notice to employees beginning of 1st January 2026. Employers must provide details on the statewide CalFresh food assistance program, as well as whether they intend to coordinate assistance through the regional workforce board or another organization.
Existing Law
Employers are required by law to give affected employees, the Employment Development Department, the chief elected official of each county and city government, and the local workforce development board, where the mass layoff, termination, or relocation occurs, written notice sixty days before the change.
3. New SB 617 Notification Requirements for Terminations, Relocations, or Mass Layoffs
The written notice requirements for employers under Cal-WARN were modified by Governor Newsom (Labor Code sections 1401). Employers must give the details in written notices of mass layoffs, relocations, or terminations (starting 1st January 2026):
Employers must set up services within thirty days of the date of the written notice if they decide to engage with the local workforce development board or a different organization.
4. Gratuities & Tips: SB 648
This alters Labor Code section 351 to grant the Labor Commissioner the authority to look into employee gratuity complaints, issue penalties, or bring a civil lawsuit against a company for withheld, late, or taken gratuities. Employees can now submit grievances with the Labor Commissioner & have an additional opportunity to pursue delayed or unpaid tips, even though it has been illegal to collect employee tips or operate an unfair or unreasonable tip pool.
In addition to paying back the gratuity, an employer faces a civil fine of one hundred dollars for the first infraction and two hundred fifty dollars for each consecutive infraction for every worker whose tips were collected.
5. California Strengthens Employee Mobility with AB 692
As a component of the state’s ongoing efforts to safeguard employee mobility, AB 692 forbids numerous “stay-or-pay” arrangements as of 1st January 2026. With the exception of specific tuition and advance discretionary bonus payments, this new rule under California employment laws prohibits typical agreements that oblige an employee to compensate employers for charges like relocation costs and work-related courses of study if the job ends before a predetermined time.
Prohibitions Under AB 692
It is illegal for any employer to demand that an employee sign a contract that accomplishes one or more of the following as a requirement of employment:
Repayment of tuition and exceptions for upfront discretionary bonuses
In some situations, contracts referring to the recovery of fees for a transferable certificate and advance discretionary payments (such as sign-on bonuses or relocation help) that are not dependent on employment performance are allowed.
Fines
The Bill creates a personal right of action for injunctive relief, reasonable attorneys’ fees and legal expenses for the employee, and monetary compensation equal to the worker’s real losses or $5,000, whichever is larger.
6. AB 858: Extension of Displaced Service Workers’ Rehiring Protections
Through 1st January 2027, AB 858 expands the Labor Code section 2810.8 re-employing protections for private clubs, hotels with fifty or more rooms, event centers, building services contractors, and airport hospitality & service providers.
Before employing new employees, subject employers are required to provide their laid-off workers with details regarding job vacancies that become open and to offer opportunities to those dismissed on the basis of a seniority preference scheme, following predetermined schedules and processes.
A “laid-off employee” is an employee who has worked for the company for six months or longer and whose latest separation from full-time employment by the company took place on or after 4th March 2020, and was caused by a COVID-19 pandemic-related reason, such as a public health order or a decrease in force, among others.
All employment opportunities that become open for which laid-off workers are qualified must be offered in written form, by mail delivery or hand, and, to the degree that the employer has such information, by email or text message within 5 business days of the position being established. After receiving the offer, a laid-off employee must have at least 5 business days to accept or reject it.
1. Adds Education and Training Records to Personnel File Requests: SB 513
SB 513 modifies Labor Code section 1198.5 to incorporate training and education records in the list of personnel documents that employers are required to provide to employees for review.
Existing Law
Employers in California are currently required by law to permit both current and former workers to view and obtain copies of employee records related to their performance or any grievances they may have. Employers are required to keep personnel files for a minimum of three years upon separation and to reply to written inquiries within thirty days (or up to thirty-five days by mutually written agreement). Violations are considered infractions under the Labor Code and may result in a $750 fine, injunctive relief, and legal fees.
New Conditions Under SB 513
According to SB 513, training and education records are now considered “personnel documents relevant to the worker’s performance” and must be provided upon request from an employee according to section 1198.5. Employers who keep such records are required to make sure they include the following details:
2. SB 642: Modifications to California’s Equal Pay Statutes
The SB 642 (Pay Equity Enforcement Act), which goes into effect on 1st January 2026, substantially modifies California’s Equal Pay and Pay Transparency laws by expanding important definitions, expanding the statute of limitations to 3 years, with a right to recover for the full duration of a violation, up to a maximum of six years, and defining classifications of prohibited conduct under the act.
California’s Pay Transparency Law’s New Definition of “Pay Scale”
Employers are required by California’s Pay Transparency Law, which is written in Labor Code section 432.3, to give workers “pay scale” information and to proactively include pay scale details in job advertising if they employ fifteen or more people.
The wage or salary range that the company anticipated paying “for the employment” was formerly included in the definition of “pay scale.” The revised definition also mandates that employers give a “good faith assessment” of the pay or wage band upon hire. This implies that instead of providing a projection for the entire position, firms are now required to reveal what they realistically anticipate paying a fresh hire on day one.
Extended Meaning of “Sex” & “Wages”
California’s Equal Pay Law is in Labor Code section 1197.5. Companies aren’t allowed to discriminate according to gender. They must pay workers the same salary for doing essentially the same work. Employers were formerly forbidden under Section 1197.5 from paying a worker less than a worker of the “opposite sex.”
The law is amended by SB 642 to forbid pay disparities between employees of “another sex,” which now includes non-binary genders. This means that when performing essentially equivalent work, employees with diverse identities of gender or gender expressions—regardless of whether they are stereotypically linked to the individual’s assigned sex at birth—must be paid similarly to those of other genders.
Additionally, SB 642 greatly expands the definition of “wages” to encompass all types of compensation. This includes bonuses, shares, stock options, housekeeping or gas allowances, lodging, & payment for travel expenses. Employers are now required to make sure that all forms of pay, not only salaries or hourly rates, are paid equally to men and women. Except when there is a legitimate basis for the difference or a business requirement. SB 642 clarifies that this broad definition of wages is exclusive to section 1197.5 & does not extend to any other part of the Labor Code.
All job posts made on or after 1st January 2026 must include the necessary pay scale information, according to covered firms. Additionally, employers should update their pay rules and regulations according to California employment laws to forbid pay disparities between employees of different sexes and to guarantee that all kinds of compensation—not only salaries and hourly rates—are paid equally to both sexes.
3. SB 464: Expansions of Employer Compensation Data Reporting
Expanded Demographic Requirements and Different Employer Pay Data Collection for 2026–2027
Every year, the Civil Rights Division must receive pay data reporting from private employers with at least 100 staff members on the payroll or from employers using labor contractors that hired 100 or more workers.
A private company with more than 100 workers is required by law to submit a yearly pay data statement to the Civil Rights Department. This report must include the number of workers by ethnicity, race, and sex in ten designated job categories; the number of workers by ethnicity, race, and sex whose salary falls within federal wage bands; the mean and median hourly rate for workers with any mix of those characteristics within every job category; and the aggregate number of hours performed by each worker counted in every paycheck band in the “Reporting Year,” as specified.
Employers & labor contractors are required to keep demographic pay data apart from worker personnel files as of January 1, 2026. Additionally, a business will be required to report employee demographic data in 23 Standard Occupational Classifications groups beginning with the 2026 reporting, slated for May 2027 (up from the present EEO-1 classifications by ethnicity, race, and sex).
Stricter civil fines (up to one hundred dollars per worker for the first failure to file and a maximum of $200 per worker for each consecutive failure) are imposed on employers who neglect to submit a pay data report upon request from the CRD & labor contractors who neglect to supply pay data to employers.
1. Paid Family Leave for Specified Individuals: SB 590
SB 590 employees will be eligible for state Paid Family Leave (PFL) benefits starting on 1st July 2028, if they take time off to care for a very sick “designated person.”
In accordance with the California Family Rights legislation, a “designated person” is described as “any care beneficiary connected by blood or whose connection with the worker corresponds to the same as that of a family relationship.”
The first time an employee files a claim for temporary disability insurance (family) benefits, they must recognize the named individual and, under penalty of perjury, confirm how they are related to the designated person by blood or comparable means of a family relationship.
2. AB 406: Safeguards for Survivors of Violence at Work
AB 406 broadens the protections for crime victim accommodations and time off. It forbids employers from firing or discriminating in any way against a worker who is a victim or a victim’s family member for taking time off to attend court proceedings with respect to that crime.
1. Rest Periods for Workers (Safety-Sensitive) at Petroleum Facilities: AB 751
Labor Code section 226.75 is amended by AB 751. It extends rest period exemptions in perpetuity for certain employees who work in safety-sensitive jobs at petroleum facilities and refineries. The worker must carry and maintain a communication tool, respond to situations of emergency, or stay on employer property to monitor the premises and attend to emergencies.
When an employee’s situation prevents them from taking a break, their employer must compensate them for the missed rest period with one hour of compensation at their normal rate of pay.
2. Exemptions from ABC Independent Contractor Test for Commercial Fishers & Manicurists: AB 1514
The exemptions from the ABC employee vs independent contractor employee classification test (and the ruling in Dynamex Operations West versus Superior Court (2018)) for registered manicurists and commercial fishermen working on American vessels are extended by AB 1514 until 1st January 2029 and 1st January 2031, respectively. The more accommodating G. Borello & Sons vs Department of Industrial Relations (1989) criterion for independent contractors will be used to evaluate workers who are eligible for the exemption.
Web browsers have to enable users to opt out (AB 566)
As of 1st January 2027, companies that run websites in California are required by the latest California Opt Me Out Act law to incorporate web browser features for customers that allow the browser to routinely transmit an opt-out option preference message to website owners (a signal that conveys the customer’s decision to opt out of the purchase and sharing of the customer’s personal information is known as an opt-out preference signal).
According to the new rule under California employment laws, it must be simple for someone with common sense to find and set up. In a bid to give consumers more control over their personal data, California is the very first state to enact such legislation under California employment laws.
Website owners should make sure that the websites they own are configured to accept opt-out choice signals, including the ones that browsers might send out automatically in the near future.
The California Privacy Protection Agency is now able to create California employment laws related to these obligations. Website operators should assess their rules and practices now with the goal of being compliant and steering clear of any legal issues.
1. PERB’s Authority Expansion: AB 288
With effect from 1st January 2026, AB 288 broadens the jurisdiction of the California PERB (Public Employment Relations Board), which presently regulates collective bargaining within the public sector. It permits PERB to hear specific cases involving ULPs (unfair labor practices) involving workers in the private sector and perform other actions that are typically the sole purview of the NLRB (National Labor Relations Board).
The Functions of AB 288
If the NLRB does not act within the required timeframes, AB 288 gives private-sector employees and labor unions the authority to submit their grievances to PERB. In particular, employees could ask PERB to:
To put it briefly, the measure aims to establish a separate state enforcement procedure for rights that are currently protected under the NLRA (National Labor Relations Act).
The Significance of This for California Employers
In summary, California’s attempt to increase state authority over labor relations practices in the private economy with AB 288 is audacious yet legally risky.
2. The Transportation Network Company Drivers Labor Relations Act: AB 1340
This Act goes into effect on 1st January 2026. It gives some gig drivers in California the ability to form a union, engage in coordinated activities, & negotiate collectively without being considered workers. PERB is responsible for enforcing the Act’s requirements. It includes handling labor disputes, deciding cases involving unfair practices, & supervising elections.
What Does AB 1340 Cover?
A TNC is a California-based business that links drivers and passengers utilizing personal automobiles using an app. According to the premise that they possess unionization rights under federal law, drivers who are considered workers according to federal law or NLRB (National Labor Relations Board) rulings are not covered by AB 1340. Only self-sufficient, non-employee drivers are covered under the statute.
What Is Required by AB 1340?
The Act is a reflection of California’s efforts to strike a balance between worker protections and the particular difficulties associated with app-platform-based employment, especially following the controversial enactment of Prop 22, which legally designated TNC drivers as self-employed workers.
A compilation of drivers who accomplished at least twenty rides in the previous six months shall be provided by covered TNCs to PERB on a quarterly basis beginning on 1st January 2026. Each driver’s name, registration number, available contact details, date of joining, and ride count must be included in the list.
Using the information provided by the eligible TNC businesses, PERB will determine the median ride number and identify the “active” drivers—those who met or exceeded the 20-ride criteria during the previous six months. The right to form a union will be granted to active drivers.
The NLRA’s unionization procedure differs significantly from this one. By demonstrating to PERB that it receives only 10% approval among active drivers, a TNC driver association or union can start the union organizing process. After that, PERB has thirty days to confirm that the 10% requirement has been reached.
If the ten percent criterion is reached, TNCs are required to tell active drivers no later than 30 days that the union is attempting to represent them. PERB cannot give the union the list of qualified TNC drivers until it certifies that the limit of ten percent interest in the unionization process has been reached. To start an election, the driving group or union must then demonstrate that it has thirty percent support. Remote voting will be used to conduct the election.
However, there won’t be an election, and the driving group or union will be immediately certified if it can demonstrate that it has over fifty percent support.
1. SB 303: Training on Bias Mitigation
The Fair Employment & Housing Act is amended by SB 303, which states that an employee’s assessment, screening, admission, or confession of their own individual biases that was made in an honest manner and requested or mandated as a component of a bias reduction training doesn’t, by itself, amount to illegal discrimination.
“Bias mitigation training” refers to education, activities, and training that an employer offers to employees to help them comprehend, identify, or acknowledge the impact of unconscious and conscious thought processes.
2. Extended SOL for Allegations of Sexual Assault: AB 250
There will be a two-year 2026–2027 qualifying period that begins on 1st January 2026, for the filing of sexual assault complaints that would normally be prohibited by the relevant statute of limitations. The exposure of private (as opposed to public) employers is increased by this bill.
To resurrect a sexual assault claim, it must be demonstrated that: (a) one or more entities or individuals are legally liable for damages resulting from an alleged person’s sexual assault against the defendant; and (b) an entity or entities, such as their designated representatives, engaged in or tried to cover up a prior instance or claims of sexual harassment by an alleged perpetrator.
A “concerted attempt to bury evidence linked to a sexual offense that encourages people to remain silent” is referred to as a “cover-up.”
When combined, these new California employment laws carry a trend toward more worker rights. There is more openness and more regulation. They complicate already-existing requirements.
Employers in California should think about:
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