California’s pay data reporting rules are now more burdensome.

Senate Bill 464, signed into law on October 13, 2025, enhances existing pay reporting requirements to address wage disparities. It introduces strict changes for private employers, effective in 2026 and 2027, including stricter penalties and reporting on new job categories.

Current Reporting Rules

Private employers with 100 or more employees, including many workers employed through labor contractors, must submit annual pay data reports to the California Civil Rights Department (CRD) for a “snapshot” period. These reports cover:

  • Employee counts by race, ethnicity, and sex across 10 job categories (aligned with EEO-1 reporting);
  • Employee earnings within the U.S. Bureau of Labor Statistics pay bands, including hours worked;
  • Mean and median hourly pay rates by race, ethnicity, and sex.

Non-compliance risks penalties of $100 per employee ($200 for repeats), at the court’s discretion.

2026: Mandatory Penalties & Data Storage Requirements

Starting in 2026, penalties will become mandatory upon CRD request. For example, a 500-employee firm that failed to submit a report would face $50,000 to $100,000 in fines. However, if the violation is due to a labor contractor failing to provide the required data, courts may shift part of the penalty to them.  For 2026, reports are due by May 12 (the second Wednesday in May).

In addition, SB 464 requires that employers store demographic data separately from personnel records.

2027: New Job Categories

In 2027, the 10 job categories expand to 23, based on the Standard Occupational Classification System, like “Chief executives,” “Computer and mathematical occupations,” and “Life, physical, and social science occupations” (the full list is available here).

For example, janitors fall under “Building and grounds cleaning and maintenance occupations,” administrative assistants under “Office and administrative support occupations,” and nurses under “Health care practitioners and technical occupations.” Employers must reassign roles to these categories.

Act Now

Employers should start planning now:

  • Coordinate with vendors to ensure complete data for the May 12, 2026, deadline; 
  • Begin evaluating roles for reassignment into the 23 categories for the 2027 reporting cycle, and;
  • Align reassignments with any other reporting that may be impacted (EEO-1s).

If you have questions about California’s amended pay data reporting requirements and how these changes may apply to your organization, contact a Jackson Lewis attorney for guidance.

Recently, California’s Governor signed Senate Bill (SB) 590, which expands eligibility for benefits under the state paid family leave program to include individuals who take time off to care for a seriously ill designated person.

In 2022, the state passed Assembly Bill (AB) 1041, which allowed employees to take leave to care for a “designated person,” defined as any individual related by blood or whose association with the employee is equivalent to a family relationship. However, the state benefits did not change to cover these types of leaves.  SB 590 specifically codifies and defines a “designated person” under Section 3302 of the Unemployment Insurance Code.

Commencing July 1, 2028, benefits under the state-paid family leave program will be available to employees caring for a designated person. When requesting family temporary disability insurance benefits to care for a designated person, the worker must both identify the individual and attest under penalty of perjury to the nature of the relationship, including either how the designated person is related by blood or how the worker’s association with the designated person is the equivalent of a family relationship.

If you have questions about SB 590 or related issues, contact a Jackson Lewis attorney to discuss.

Governor Newsom has signed Assembly Bill (AB) 692, which adds Section 16608 to the Business and Professions Code and Section 926 to the Labor Code, making it unlawful to include in any employment contract or require a worker to execute, as a condition of employment, a contract that includes terms that require a worker to  “pay an employer, training provider, or debt collector for a debt if the worker’s employment or work relationship with a specific employer terminates,” with limited exceptions.

The bill will apply to contracts entered into on or after January 1, 2026.

The law applies to all employers in California.

Under the law, it will be unlawful to include terms that impose penalties or fees, or require employees to pay debts, authorize debt collection, if the employment relationship ends.

There are some allowances for contracts for repayment under the law:

  • A contract entered under a loan repayment assistance program or loan forgiveness program provided by a federal, state, or local government agency.
  • A contract related to the repayment of the cost of tuition for a transferable credential, provided that the contract (a) is separate from the employment contract, (b) does not make obtaining the transferrable credential a condition of employment, (c) specifies a repayment amount not exceeding the cost of the credential to the employer, (d) provides for prorated repayment without acceleration; and (e) does not require repayment if terminated unless the worker is terminated for misconduct.
  • A contract related to enrollment in an apprenticeship program approved by the Division of Apprenticeship Standards.
  • A contract for the receipt of a discretionary or unearned monetary payment at the outset of employment, including a financial bonus, not tied to specific job performance, provided that (a) the terms of repayment are separate from the employment contract; (b) the employee is notified of their right to consult an attorney about the agreement and provided not less than five business days to do so; (c) repayment is prorated based on the remaining term of any retention period which must not be more than two years, without interest accrual; (d) the worker may defer receipt of the payment to the end of the retention period without repayment obligations; and (e) separation is either at the employee’s sole discretion or due to employee misconduct.
  • A contract related to the lease, financing, or purchase of residential property.

The law allows for private rights of action, including minimum damages of $5,000 per worker, injunctive relief, and attorneys’ fees and costs.

If you have questions about compliance with AB 692 or related issues, contact a Jackson Lewis attorney.

On October 12, 2025, Governor Newsom signed Senate Bill (SB) 294, which requires employers in California to provide a stand-alone written notice of worker rights to each new employee when hired, and annually to all current employees. It also tasks the Labor Commissioner with developing and annually updating a template notice and related educational materials for California employees and employers.

This bill takes effect on January 1, 2026, and requires a template notice to be available on or before that date, which includes information on many areas of workers’ rights under state and federal law. Employers have until February 1, 2026, to provide the notice to employees and thereafter provide it annually.  

Under the law, employers must also allow employees to designate an emergency contact to be notified if the employee is arrested or detained at work or during work hours, and the employer has actual knowledge of the event. This part of the law must be implemented with all current employees by March 30, 2026.

The Labor Commissioner and public prosecutors are authorized to enforce the law. Employers who fail to comply may face civil penalties of up to $500 per employee for each violation, and up to $10,000 per employee for certain violations (e.g., failure to notify emergency contacts). Employees, the Labor Commissioner, or public prosecutors may recover penalties, but employers are not subject to duplicative penalties.

If you have questions about compliance with SB 294 or related issues, please contact a Jackson Lewis attorney to discuss.

Governor Newsom signed Senate Bill (SB) 513, which expands the scope of personnel documents employers must allow current and former employees to inspect.

Previously, under the California labor code, employers were required to allow current and former employees to inspect and receive a copy of personnel records the employer maintains relating to the employee’s performance or to any grievance concerning the employee. Under the amendment to the law, employers must also allow employees to inspect records pertaining to education or training that the employee received.

Such records must include all of the following:

  • The name of the employee
  • The name of the training provider
  • The duration and date of the training
  • The core competencies of the training, including skills in equipment or software
  • The resulting certification or qualification.

This law takes effect January 1, 2026.

If you have questions about SB 513 or related issues, contact a Jackson Lewis attorney to discuss.

On October 8, 2025, Governor Newsom signed Senate Bill (SB) 642, which revised California’s Equal Pay Act.

Revisions to the Act will take effect January 1, 2026.

Under the amendment:

  • The definition of “pay scale” is revised to mean “a good faith estimate of the salary or hourly wage range  the employer reasonably expects to pay for the position upon hire.”
  • The definition of “sex” is aligned with other portions of the Fair Employment and Housing Act.
  • The definition of “wages” and “wage rates” is revised to include “all forms of pay, including but not limited to, salary, overtime pay, bonuses, stock, stock options, profit sharing and bonus plans, life insurance, vacation and holiday pay, cleaning and gasoline allowances, hotel accommodations, reimbursement for travel expenses, and benefits.”  
  • The right to obtain relief is limited to a total of six years.
  • There is new guidance on what constitutes a cause of action for violations of the California Equal Pay Act.

If you have questions about SB 642 or related issues, contact a Jackson Lewis attorney to discuss.

California’s Governor signed Senate Bill (SB) 53, which creates a comprehensive regulatory framework for advanced AI. The law takes effect January 1, 2026.

SB 53 is designed to govern what it calls “frontier” AI models, which are large, cutting-edge systems built by major developers with substantial resources. The central aim of the law is to balance these competing realities: encouraging innovation while protecting public safety and property from catastrophic risks.

Overview

Although SB 53 is directed at the developers of advanced AI systems, the law’s requirements will inevitably affect the businesses that depend on these technologies.

Under the law, developers must now publish a “frontier AI framework” that explains their risk management practices. They are also required to release transparency reports before introducing new or substantially updated models. These reports must contain detailed risk assessments, strategies for mitigation, and independent third-party evaluations.

In addition, the law imposes strict incident reporting obligations. If a developer discovers a “critical safety incident,” it must be reported within fifteen days. If the incident presents an imminent risk of death or serious injury, the report must be submitted within twenty-four hours. For employers, this means that AI vendors may need to temporarily adjust or even suspend services to comply with these requirements, potentially affecting continuity of business operations.

The legislation also imposes serious financial consequences for non-compliance. Any violation can result in civil penalties of up to one million dollars per instance, enforced by the Attorney General. Businesses that rely on AI providers should therefore be prepared for the possibility that vendors who fail to meet these standards could face enforcement actions that disrupt their services.

SB 53 introduces several important legal definitions that determine when these rules apply. A “frontier model” is defined by the amount of computing power used in its training, while “catastrophic risk” refers to scenarios that could cause mass casualties or more than one billion dollars in property damage. The law also identifies “critical safety incidents” as failures or risks that could threaten life or cause serious harm. These definitions are critical because they establish the threshold at which developers, and by extension their customers, are subject to the most stringent requirements.

Whistleblower Protections

Another significant component of SB 53 is its treatment of whistleblowers. The law protects employees who raise concerns about catastrophic risks or violations. These protections include strong anti-retaliation measures, anonymous reporting options, and the ability for employees to seek injunctive relief in court. For employers, this provision highlights the need to create internal reporting systems that allow employees to express concerns about AI use safely and without fear of reprisal. Failing to do so may not only undermine compliance but also damage workplace trust.

Preemption

The law is written to ensure that its provisions apply consistently across California. It preempts local regulations that might otherwise conflict and includes clauses to ensure broad application and resilience against legal challenges. In practice, this means employers can expect uniform rules across the state rather than a patchwork of differing local ordinances.

If you have questions about compliance with SB 53 or related issues, contact a Jackson Lewis attorney to discuss.

Governor Newsom has signed Assembly Bill (AB) 858, which extends the sunset date of the recall and reinstatement rights of employees laid off as a result of the COVID-19 pandemic until January 1, 2027.

In 2021, Senate Bill (SB) 93 was passed, which required certain employers in the hospitality and service industries to rehire employees laid off due to the COVID-19 pandemic.

SB 93 applied to the following industries:

  • Hotels
  • Private clubs
  • Event Centers
  • Airport Hospitality Operations
  • Airport Service Providers
  • Building Services to office, retail, or other commercial buildings

In 2023, the expiration of the right of recall rights of employees in the hospitality and service industry was extended to December 31, 2025.

If you have questions about right of recall or related issues, contact a Jackson Lewis attorney to discuss.

On October 3, 2025, California’s Governor signed Assembly Bill (AB) 1340 which establishes the Transportation Network Company Drivers Labor Relations Act (Act) which provides drivers for certain gig drivers with the right to form, join and participate in the activities of driver organizations, to bargain through representatives of their own choosing, and to engage in concerted activities for the purposes of bargaining or other mutual aid protection.

Under AB 1340, the Public Employment Relations Board (PERB) is tasked with administering the Act, including overseeing elections and determining unfair practices.

The Act will take effect January 1, 2026.

The Act defines a transportation network company or TNC as an organization that provides prearranged transportation services for compensation using an online-enabled application or platform to connect passengers with drivers using a personal vehicle.

On January 1, 2026, and every three months thereafter, TNCs must submit to PERB a list of information for drivers who have completed at least 20 rides in California within the preceding six months, including their most recent email address, driver’s license number, phone number, mailing and local residence addresses, platform joining date, and number of rides completed. PERB will then, within two weeks, compile a list of drivers who have completed the median number of drives or more and deem those drivers as active TNC drivers.

TNC driver organizations can trigger an election by presenting PERB with a 10% showing of interest among active TNC drivers, and within 30 days PERB will determine if this showing meets the 10% threshold. If this showing of interest is met, within 30 days of PERB’s determination (and on the 15th of every January, April, July, and October, PERB will provide the drivers union with the list of active TNCs; moreover, within 30 days of PERB’s determination, the TNC must send a notice to its active TNC drivers that the union is trying to organize and represent TNC drivers.

Covered TNCs will be required to negotiate sector-wide agreements with certified driver organizations. These agreements must address issues like these agreement must address issues like appealing the deactivation of a driver, paid leave, safety standards, and grievance procedures. Importantly, agreements cannot reduce minimum driver guarantees or alter drivers’ independent contractor status.

If you have questions about AB 1340 or related issues, contact a Jackson Lewis Attorney to discuss.

A good development for employers from the district court. At the beginning of the year, Senate Bill (SB) 399 became effective, restricting employers from requiring participation in mandatory meetings addressing religious or political topics, including those concerning labor organizations. Shortly thereafter, several business groups filed a federal lawsuit challenging the constitutionality of SB 399 and seeking declaratory and injunctive relief.

Recently, the district court issued a preliminary injunction, temporarily prohibiting the enforcement of SB 399. The court determined that SB 399 is preempted by the National Labor Relations Act (NLRA) to the extent that it restricts employers from mandating attendance at meetings regarding unionization. Additionally, the court ruled that SB 399 constitutes a content-based regulation of speech, as it specifically targets employer communications on subjects such as religious or political matters.

Enforcement of SB 399 will remain suspended until litigation at the district court level concludes and may potentially be permanently enjoined based on the final outcome.

Jackson Lewis will continue to monitor developments in this case. For questions related to SB 399 or similar matters, please contact a Jackson Lewis attorney for further discussion.