Midyear Pulse Check: California Employment Laws, Effective January 1, 2026
- Simone McClellan, PHR, SHRM-CP
- Jul 1
- 10 min read
Updated: Jul 24
Please note: The information provided regarding employment laws affecting the workplace is intended for general guidance only and does not serve as, nor replace, professional legal advice. Neither Simone McClellan, PHR, SHRM-CP, nor Tritrix HR Solutions is an attorney, law office, or provides legal advice. Legal advice should be sought from a licensed attorney.
This blog post is not intended to create a consultant-client relationship and the receipt of it (by reading, viewing, etc.) does not constitute professional consulting advice nor does it establish a consultant-client relationship.
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Highlights and Takeaways
Five (5) legislative changes and their respective subcategories have emerged at the forefront, so far:
SB 294 Workplace Know Your Rights Act: Requires employers to provide a new, stand-alone written notice of labor, immigration, and constitutional rights to all employees by February 1, 2026, and annually thereafter. It also requires establishing emergency contact procedures by March 30, 2026
AB 692 Employment: contracts in restraint of trade (Stay-or-Pay Contracts): Generally, prohibits employment contracts that require workers to pay back training costs if they leave within a certain timeframe
Wage and hour changes:
SB 3 Minimum Wage Adjustment (Department of Industrial Relations (DIR) Announcement): The statewide minimum wage increases to $16.90 per hour; exempt employee salary thresholds are now $70,304/year
SB 464 Employer pay data: Expanded pay data reporting requirements
SB 642 Equal Pay Act Enhancements: Refines "pay scale" definitions for job postings, strengthens pay transparency, and updates language to prohibit pay differentials based on gender, rather than just "opposite sex"
SB 648 Employment: gratuities: enforcement: Stricter enforcement of gratuity violations
AB 406 Employment: unlawful discrimination: victims of violence (also known as Crime Victim Leave): Expands leave entitlements for employees who are victims of crime
SB 513 Personnel Records: Personnel records must now include specific education and training records
As the holiday season of 2025 is well behind us and the 2026 calendar year is in its third quarter (Q3), it may be a good time for a pulse check on the laws from the 2025-2026 Regular Session of the California State Legislature (First Year), which became effective January 1, 2026, unless otherwise stated.
Kindly note, this blog has been drafted as a listicle for ease of readability and convenience and is not exhaustive. For any in-depth employment law scenarios that my apply to your specific situation, it is recommended to seek legal advice from a licensed attorney.
For clarification:
The two-year cycle for the 2025-2026 Regular Session of the California State Legislature started December 2, 2024 and ends November 30, 2026.
AB stands for Assembly Bill. Each bill is followed by a number that represents the sequence in which it was introduced during the California two-year legislative session (e.g., AB 123).
SB stands for Senate Bill. Each bill is followed by a number that represents the sequence in which it was introduced during the California two-year legislative session (e.g., SB 456).
Let’s start the list!
CALIFORNIA ASSEMBLY BILLS (AB)
AB 288 Employment: labor organization and unfair practices:
Expands the Public Employment Relations Board (PERB) jurisdiction to enforce federal labor laws in California’s private sector. It allows PERB to intervene in unfair labor practices and union elections if the NLRB fails to act.
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AB 406 Employment: unlawful discrimination: victims of violence (also known as Crime Victim Leave):
While the main provisions became effective January 1, 2026, AB 406 amends and expands upon the protections of AB 2499, which was effective the year prior on January 1, 2025. AB 406 prohibits employers from discharging, discriminating, or retaliating against employees who take time off to attend judicial proceedings related to a crime. It covers acts like stalking, domestic violence, and serious felonies.
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AB 692 Employment: contracts in restraint of trade:
Prohibits employers from using "stay-or-pay" contracts that force employees to repay training, education, or separation-related costs upon leaving a job. The law voids such provisions as illegal, non-compete style restraints, except for specific, narrow exemptions like qualified apprenticeship programs or, in some cases, voluntary, non-penalizing training reimbursement.
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AB 751 Rest periods: petroleum facilities: safety-sensitive positions (2025-2026 Regular Session):
Permanently extends the exemption from mandatory rest periods for employees in safety-sensitive positions at petroleum facilities and certain refineries, removing the previous January 1, 2026, sunset date. It applies to workers required to monitor, carry communication devices, and respond to emergencies.
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AB 1340 Transportation network company drivers: labor relations (also known as Transportation Network Company Drivers Labor Relations Act):
Grants rideshare drivers (Uber/Lyft) the right to form organizations, bargain collectively, and engage in concerted activities while maintaining independent contractor status under Prop 22.
CALIFORNIA SENATE BILLS (SB)
SB 3 Minimum Wage Adjustment (SB 3, Minimum wage: in-home supportive services: paid sick leave):
California's statewide minimum wage increases to $16.90 per hour for all employers, regardless of headcount. The increase raises the minimum exempt salary threshold to $70,304 annually. Specialized, higher rates apply to fast-food and health-care workers. Employers must adhere to the highest applicable rate (city, county, or state). It was enacted to provide an alternative to the "Fair Wage Act of 2016" ballot initiative.
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SB 53 Artificial intelligence models: large developers (also known as Transparency in Frontier Artificial Intelligence Act (TFAIA)):
It establishes a comprehensive framework for AI safety, focusing on accountability and transparency for the largest AI developers.
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SB 261 Division of Labor Standards Enforcement: Wage Claim Judgments (also known as Penalties for Unpaid Wage Judgments):
Employers failing to pay a Labor Commissioner judgment within 180 days face penalties up to 3 times the amount owed, mandatory attorney fees for employees, and liability for successor employers. Penalties under the new statutory section are in addition to, and not in lieu of, other penalties and/or fines available under law.
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SB 294 Workplace Know Your Rights Act:
Requires employers to provide a new, stand-alone written notice of labor, immigration, and constitutional rights, which includes wages, unionization, and law enforcement interactions, to all employees by February 1, 2026, and annually thereafter. It also requires establishing emergency contact procedures by March 30, 2026. ==
SB 464 Employer pay data:
Enforces stricter pay data reporting for employers with 100+ employees to submit detailed annual pay reports to the Civil Rights Department. Non-compliance mandatory fines are $100–$200 per employee. SB 464 requires separate storage of demographic data, and expands to 23 job categories by 2027.
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SB 477 California Fair Employment and Housing Act (FEHA): enforcement procedures:
Amends FEHA to enhance the Civil Rights Department's (CRD) authority. It defines "group or class complaint" as any pattern or practice complaint, expands tolling of deadlines during investigations or appeals, and extends the time to file civil actions after case closures.
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SB 513 Personnel records:
Expands the definition of “personnel records” to include education and training records. Employers must make these specific records available to current and former employees for inspection and copying, alongside traditional performance documents, to verify employee skills and certifications.
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SB 590 Paid family leave: eligibility: care for designated persons (also known as Paid Family Leave to Care for Chosen or Extended Family Act):
Expands Paid Family Leave (PFL) by redefining "family member" to include a "designated person" — someone related by blood or having the equivalent of a family relationship —effective July 1, 2028. It enables wage-replacement benefits for caring for non-traditional family, requiring employees to identify the person and attest to the relationship under penalty of perjury.
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SB 642 Employment: payment of wages (also known as Pay Equity Enforcement Act):
It expands the definition of "wages" to include all compensation, updates pay scale requirements for job postings, and extends the statute of limitations for pay discrimination claims. The act is designed to increase transparency and close wage gaps, applying to both internal and external job postings. SB 642 updates language to prohibit pay differentials based on gender, rather than just "opposite sex”.
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SB 648 Employment: gratuities: enforcement (also known as Labor Commissioner Authority to Issue Citations for Tip Theft):
Reinforces that tips are the sole property of the employee and provides a more direct administrative process for recovering stolen tips. SB 648 introduces specific civil penalties, including fines of $100 per employee per pay period for an initial violation and $250 for each subsequent violation, all in addition to the actual tips and wages owed. Willful violations can incur penalties up to $1,000. The California Labor Commissioner will have new, express authority to investigate, issue a citation or file a civil action for gratuities that are unlawfully taken or withheld.
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SB 809 Employees and independent contractors: construction trucking:
Clarifies that owning a vehicle (personal/commercial) does not automatically make a worker an independent contractor. The statute also specifies that an employer's Labor Code Section 2802 reimbursement obligation includes use of a vehicle owned by an employee and used by that employee in the discharge of their duties
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SB 847 Workers’ compensation: uninsured employer: transfer of real property:
Amends the Labor Code to help injured workers recover compensation from illegally uninsured employers. It authorizes the state to place liens on property transferred by uninsured employers to avoid paying claims.
Image via Canva.com
Midyear Pulse Check:
Action Items for Employers
2026 is in full swing… how are your action items for employers progressing?
Update Handbooks: Revise policies to reflect new leave, pay, and reporting obligations
Update Job Postings: Ensure salary ranges meet the refined definition of "pay scale" under SB 642
Update Onboarding Materials: Ensure necessary and/or mandatory notices and forms are included to comply with the 2026 effective dates
Review Contracts: Audit training repayment agreements ("stay-or-pay") to comply with AB 692
Check Workplace Rights Notice: Was it issued by Feb. 1, 2026?
Training Managers: Have managers been trained on new, strict compliance timelines to mitigate litigation risk?
Thank you for reading and taking time to invest in your human resources journey. Our aim is to provide insights that drive conversations that shape the future of work.
About the Author: Simone McClellan, PHR, SHRM-CP, is the Chief Solutionist and HR Consultant at Tritrix HR Solutions, a California-based, USA entity. She has 10+ years of human resources (HR) experience and holds both the Professional in Human Resources (PHR) and the SHRM-Certified Professional (SHRM-CP) certifications. Simone specializes in helping people navigate the complexities of HR compliance obligations and employee experience to elevate people's work purpose and build stronger workforces. Discover more at www.tritrixhr.com.
Tritrix HR Solutions a California-based, USA, entity providing external human resources (HR) consulting services for individuals and small businesses throughout California works with individuals and companies on a diverse genre of HR topics. Our mission is to navigate every individual and organization through the complexities of human resources by providing practical and actionable solutions that connect people with meaningful purpose.
Works Cited:
California Legislative Information
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