New employment related laws were recently enacted by the state of California effective January 1, 2027.  Employers should take note of these new laws and how they impact their workplace, as well as update their policies and employee handbooks accordingly

Wage and Hour Legislation

Effective January 1,2027, California minimum wage will increase to $17.40.  Other cities and unincorporated areas have additional higher minimum wage requirements. Click here to review these increases which was included in our August newsletter. As a result of this increase. the minimum salary for exempt employees will increase to $72,384.00.

No Robo Bosses Act

This law prohibits employers from relying solely on automated decision systems (ADS) which is a computational process created through the use of data analytics or by AI. If ADS is used for discipline or termination decisions, the new law requires a human reviewer to independently corroborate the ADS output.  Moreover, if the decision to discipline or terminate primary relies upon the ADS output, the employer must disclose this to the employee and confirm that a human reviewed the ADS and corroborated the ADS output.  The employee can also request a copy of the output relied upon.

Cal-WARN AI Notice

Cal-Warn requires employers with 75 employees, who lay off 50 or more employees over the prior 12 months to provide at least 60 days’ notice of the layoff to the impacted employees. A new law now provides that if such a covered mass lay off is caused in whole or in part by substantial part by AI or other automated technology/automating jobs, the Cal-Warn notice must include additional disclosures regarding use of such technology.    

Workplace Surveillance

AB 1883 bans the use of “workplace surveillance tool[s]” that use AI to either: (1) recognize, or make inferences or predictions about, an individual’s emotional state; or (2) collect neural data. “Workplace surveillance tools” are defined in the law as “any system, application, instrument, or device that collects” information about employees’ activities, communications, biometrics, or behaviors in a way other than direct observation by a human. Such tools include video or audio surveillance, time-tracking, geolocation tools, or others that use “a photo-optical system.” Additionally, the law bans the collection of employees’ “neural data,” meaning information that measures employees’ central or peripheral nervous systems.

Requirement of Anti-hate Speech Training

This law will require employers to include anti-hate speech training as part of all mandatory sexual harassment training that employers must already provide under California law. Beginning January 1, 2028, employers will be required to include guidance on recognizing, reporting and confronting hate speech, which is defined as speech that vilifies, humiliates or incites hatred against people based on a protected characteristic.

Menopause Protections

This new law adds menopause, perimenopause, post-menopause and related medical conditions as protected characteristics under the California Fair Employment and Housing Act (FEHA).  Employers should update their employee handbooks to reflect this additional defined term.

Changes to definition of sex discrimination

This new law adopts a uniform definition of sex discrimination for all state law purposes. The new definition encompasses discrimination based on actual or perceived:

• Assigned sex or gender category;
• Degree of conformity to sex or gender stereotypes;
• Gender, including gender identity, gender expression and access to or use of gender-affirming and related health care;
• Pregnancy or related medical conditions;
• Decision-making, access to care, or potential or actual use of a drug, device, product or service relating to pregnancy or related medical conditions;
• Sexual orientation; and
• Variations in sex characteristics, including intersex traits or differences in sex development.

Changes to Pay Data Reporting Law   

California’s revised pay data reporting law which raises penalties for an employer’s repeated failure to submit pay and demographic information required under California’s pay data reporting law. The law imposes a $200 fine (per employee) for a second violation, which increases up to $1,000 per employee for each subsequent violation.

Expansion of Bereavement Leave Rights

This new law added new rights to employees who wish to take bereavement leave.  The law added “designated person” to the definition of “family member.” “Designated person” means any individual related to the employee by blood or whose association is equivalent to a family relationship. Based upon this change in law, employees may now identify their designated person at the time they request bereavement leave. However, employees are limited to one designated person per 12-month period for bereavement leave. As such, employers should update their bereavement leave policies and employee handbooks to reflect the expanded definitions of “family member” and “designated person.”

Should you have any questions regarding these new employment laws, and/or would like assistance in updating your organization’s employee handbook, contact Scott Liner at [email protected].

Is your employee handbook ready for 2027?
Contact Chase Law Group for help updating your policies.
Call 310.545.7700.

WWW.CHASELAWMB.COM

_{Please note that this article is for informational purposes only and should not be considered legal advice and does constitute an attorney-client relationship. It is recommended to consult with an attorney and your insurance carrier directly for specific guidance pertaining to your business and its practices.}