The Ninth Circuit has affirmed a preliminary injunction preventing California from enforcing Senate Bill 399, the state’s “captive audience” law.
The decision gives employers an important, but provisional, development in the ongoing debate over workplace meetings about political, labor organization, and religious issues. It does not finally invalidate SB 399, and employers should treat the ruling as an incomplete resolution of the law’s risks.
SB 399, effective January 1, 2025, prohibited an employer from taking or threatening adverse action against an employee who declines to attend an employer-sponsored meeting, or receive or listen to employer communications, when the purpose is to communicate the employer’s opinion about religious or political matters.
The law defines political matters broadly to include elections, political parties, legislation, regulation, and support for political or labor organizations. Religious matters include religious affiliation and practice and support for religious organizations. Employees who opt out of a meeting while working must continue to be paid. The statute authorizes Labor Commissioner enforcement and gives employees a private right of action, with potential civil penalties, damages, punitive damages, and injunctive relief.
In California Chamber of Commerce v. Bonta, three business associations challenged the statute before it took effect. The district court preliminarily barred California from enforcing SB 399, and the state appealed. The Ninth Circuit held that at least one association had standing because its members planned to hold “all-hands” meetings to discuss the legislation and faced a credible risk of enforcement.
On the merits, the panel concluded that the associations were likely to succeed on their First Amendment claim. SB 399 regulates meetings based on the subjects discussed and the employer’s viewpoint, so the court applied strict scrutiny. California argued that employees may be a “captive audience” because they depend on their jobs and may feel pressure to attend. The panel found that rationale insufficient to justify a content-based restriction on private employers’ speech in private workplaces. It explained that prior captive-audience cases involved government acting as a property owner or content-neutral limits on the time, place, or manner of speech, which were not comparable restrictions on private speech. The panel further found that neither the Supreme Court nor the Ninth Circuit had relied on captive-audience theory to establish a compelling interest sufficient to sustain content-based restrictions on non-governmental speech in a non-governmental setting.
The Ninth Circuit affirmed the preliminary injunction because California did not challenge the district court’s conclusion that the remaining injunction factors were satisfied. The ruling is not a final judgment that SB 399 is unconstitutional. It addresses likelihood of success at the preliminary-injunction stage. The panel also did not decide whether the National Labor Relations Act preempts the statute.
For employers, the practical effect is significant but should be approached carefully. The injunction bars the state defendants from enforcing SB 399 while the case continues. The opinion discussed the statute’s private right of action and the threat of employee enforcement, but the appealed injunction was framed as barring California from enforcing the law.
This decision is distinct from a prior NLRB decision in 2024 in which the Board majority held that captive-audience meetings violate Section 8(a)(1) of the NLRA because they reasonably tend to interfere with and coerce employees in exercising their Section 7 rights concerning unionization. Private sector employers should continue to be sensitive to this decision and monitor developments at the NLRB regarding the NLRB’s prohibition against captive audience meetings.