A Look at New California Labor and Employment Laws for 2025

The California Legislature has enacted several new laws that will impact the workplace in 2025. This Holland & Knight alert provides a brief summary of select employment laws that go into effect Jan. 1, 2025, unless stated otherwise.

• Minimum Wage Increases. As of Jan. 1, 2025, the California state minimum wage will increase to $16.50 per hour for all employers, regardless of employee headcount. This also means that as of Jan. 1, 2025, exempt employees in California must be paid a minimum annual salary of $68,640.
  
  "Living wage ordinances" in various locales within the state have been enacted, so local standards should be confirmed to ensure compliance with all governing wage requirements.
  
  Covered exempt computer professional employees must be paid a minimum of $56.97 per hour, or $118,657.43 in annual salary.

• AB 2499 (Paid Sick Day Use by Victims of Violence). AB 2499 expands the workplace protections for employees who are victims of crime or abuse. The law, as amended, requires employers to provide time off for victims of "qualifying acts of violence," which includes domestic violence, sexual assault, stalking, or any act, conduct or pattern of conduct that includes 1) bodily injury or death to another, 2) brandishing, exhibiting, or drawing a firearm or other dangerous weapon, or 3) a perceived or actual threat to use force against another to cause physical injury or death. A qualifying act of violence permits time off regardless of whether anyone is arrested for, prosecuted for or convicted of any crime.
  
  Under the new law, employers are prohibited from retaliating or discriminating against employees who utilize time off under this section or participate in the legal process. The amendment also provides leave to any employee who has a family member, including children, parents, grandparents, grandchildren, siblings, spouses, domestic partners or other designated person who is a victim of a qualifying act of violence.

• SB 399 (Required Attendance at Meetings to Convey Employer's Religious or Political Opinions Prohibited). SB 399, known as the California Worker Freedom from Employer Intimidation Act, prohibits covered employers from discharging, discriminating, retaliating or taking any other adverse employment action against any employee who declines to attend, participate in, receive or listen to an employer-sponsored meeting set up to communicate the employer's opinion about religious or political matters. "Religious matters" means matters related to religious affiliation and practice and the decision to join or support any religious organization or association. "Political matters" means matters relating to elections for political office, political parties, legislation, regulation and the decision to join or support any political part or political or labor organization. An employer violating this act is subject to a $500 civil penalty per employee for each violation, Labor Commissioner enforcement actions, civil actions for temporary and injunctive relief, and damages including punitive damages.
• AB 1034, AB 2288, SB 92 (Private Attorneys General Act (PAGA) Reforms). In June 2024, Gov. Gavin Newsom's administration worked with legislators to pass various largely employer-friendly reforms to PAGA to avoid a ballot proposition on eliminating PAGA. Perhaps most significant, PAGA plaintiffs must now personally experience each Labor Code violation upon which the plaintiff seeks PAGA penalties in the prior year. A PAGA plaintiff now cannot assert a laundry list of PAGA violations against an employer on behalf of other employees if the plaintiff did not, in fact, suffer those violations within the statutory period. Courts also now have discretion, by statute, to limit the scope of PAGA claims heard for manageability purposes. The PAGA reforms also expand cure opportunities for employers, which, if not totally eliminating liability, may significantly cap or reduce liability. Certain employers may also request a mandatory early stay and evaluation with the court to determine if early resolution is feasible. The statutes contain a number of other procedural and substantive changes to PAGA.
• AB 2123 (Paid Family Leave). AB 2123 will eliminate an employer's ability to require an employee to use accrued paid time off (PTO) before using California Paid Family Leave (PFL). PFL is a state-run program providing benefits to individuals taking time off to care for a seriously ill child, spouse, parent or domestic partner, bond with a new minor child, or assist military family members under active duty. Previously, employers could require employees to take up to two weeks of accrued vacation before accessing PFL benefits. As of Jan. 1, 2025, this option will be eliminated.
• SB 1137 (Combinations of Protected Characteristics). SB 1137 amends California's antidiscrimination laws, the Fair Employment and Housing Act (FEHA), Unruh Civil Rights Act and relevant provisions of the Education Code to clarify that the law prohibits discrimination on the basis not just of individual protected traits, but also on the basis of the intersectionality (combination) of two or more protected traits.
  
  SB 1137 codifies the U.S. Court of Appeals for the Ninth Circuit ruling in Lam v. University of Hawai'i (9th Cir. 1994) 40 F.3d 1551, which recognized that discrimination and harassment may be predicated upon the unique combination of protected characteristics.

• AB 1815 (Hairstyles and Traits Associated with Race-Protected Characteristics). AB 1815 expands the definition of "race" in the CROWN Act, anti-discrimination provisions of the California Fair Employment Housing Act. Under the new law, "race" is inclusive of traits associated with race, including hair texture or protective hairstyles such as braids, locs and twists. Existing law defined "race" to include only traits "historically" associated with race.
• SB 1100 (Restricting Questions About Driver's Licenses to Prevent Discrimination). SB 1100 makes it an unlawful employment practice for an employer to include statements about the need for a driver's license in job advertisements, postings, applications and similar employment material. Employers may require that an applicant must have a driver's license only if 1) the employer reasonably expects driving to be one of the job functions of the position and 2) the employer reasonably believes that using an alternative form of transportation (such as taxis, carpools, bicycles and walking) would not be comparable in travel time or cost to the employer.
• AB 2299 (Whistleblower Rights Posting). AB 2299 requires the state's Labor Commissioner to develop a model list of employee rights and responsibilities under existing whistleblower laws. Currently, employers are required to post certain workplace notices, including a list of employees' rights and protections under whistleblower laws. Beginning Jan. 1, 2025, employers will be required to post a specific notice drafted by the Labor Commissioner outlining employee rights and responsibilities under whistleblower laws. The new bill simply codifies the requirement for the Labor Commissioner to develop a model notice that complies with employers' existing posting requirements so that employers posting the model notice shall be deemed in compliance with the law.
• SB 1870 (Workers' Compensation Legal Advice Notice). AB 1870 amends Section 3550 of the Labor Code to require provision of information regarding an injured employee's ability to obtain legal consultation. Current law generally requires employers to post a notice in a conspicuous location that includes information such as to whom injuries should be reported, the rights of an employee to select and change a treating physician, certain employee protections against discrimination and other specific information. Beginning Jan. 1, 2025, the notice must also include information concerning an injured employee’s ability to consult a licensed attorney to advise them of their rights under workers' compensations laws.
• AB 2011 (Small Employer Mediation Program Expanded to Include Reproductive Loss Leave Claims). The small employer family leave mediation program, which covers employers with five to 19 employees, requires employees to request a mediation with the California Civil Rights Department (CRD) prior to filing claims in court for violations of the California Family Rights Act (CFRA) and California's bereavement leave law. AB 2011 expands the mediation program to include claims under Californias reproductive loss leave law.
• SB 988 (Freelance Worker Protection Act). SB 988 continues to expand recognition that solo proprietors can be independent contractors despite AB 5. Hiring parties will now be required to enter into written contracts with freelancers, defined as single persons or single person organizations (whether or not incorporated or using a trade name) hired as a bona fide independent contractor to provide services valued in excess of an aggregate of $250. Contracts must list the name and mailing address of each party, an itemized list of services to be provided, value of those services, rate and method of compensation, the date payment shall be due or determined, and the date for the contractor's submission of services rendered to process payment. Additionally, after performance has commenced, hiring parties cannot condition timely payment on the contractor's acceptance of reduced payment or furnishing additional services or consideration. Contractors are protected against retaliation under the new statute and may bring a private action to enforce their rights. Public prosecutors may also enforce the law.
• AB 2049 (Summary Judgment Filing Deadlines). Employment litigators should note the change to extend the notice period for motions for summary judgments. The new statute changes the deadline for a party to notice and file a motion for summary judgment or adjudication to at least 81 days prior to the hearing on the motion. Oppositions will now be due at least 20 days before the hearing. Replies will now be due at least 11 days before the hearing. Parties will also only be permitted to file one summary judgment motion (not applicable to summary adjudication motions) absent leave of court.
• AB 2754 (Successor Liability for Customers of Port Drayage Motor Carriers). Employers connected to the port drayage motor carrier's industry should note this change. Existing law prohibits a person or entity from entering into an employment contract or agreement with a construction, farm labor, garment, janitorial, security guard or warehouse contractor if the person or entity knows or should know that the contract or agreement does not include sufficient funds for the contractor to comply with all applicable local, state and federal laws or regulations related to the job specified in the contract. Although a person or entity (the customer) can take steps to limit their exposure in these situations, violations can still be established if the customer knew or shown have known that the contract did not provide sufficient funds. AB 2754 now extends this law to the customers of port drayage motor carriers. Effective Jan. 1, 2025, customers of port drayage services may share civil legal responsibility and civil liability to port drayage drivers for misclassification of drivers as independent contractors. Employers may want to consider revising existing contracts and preparing new driver contracts to ensure compliance with California’s Labor Code.

For more information or questions on the new California labor and employment laws and their potential impact on employers and employees, please contact the authors.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem, and it should not be substituted for legal advice, which relies on a specific factual analysis. Moreover, the laws of each jurisdiction are different and are constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular fact situation, we urge you to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.