California's New Employment Laws for 2025

Nathan Klein, Partner

January 15, 2025

With the new year, comes new laws. As always, the California legislature has been busy updating the rules and regulations that cover the workplace. Here are several key new laws for 2025 you should be aware of.

Minimum Wage Increase

The statewide minimum wage has risen to $16.50 per hour for all employers, regardless of size. This adjustment also affects the minimum salary threshold for exempt employees, which is now set at $68,640, annually. Employers should verify compliance with local ordinances, as some municipalities have established higher minimum wages.

Ban on Captive Audience Meetings

Senate Bill 399 prohibits employers from holding mandatory “captive audience meetings”, which are typically meetings wherein an employer is communicating its views and opinions about religious or political matters, including views on unionization. Employers are now prohibited from retaliating against employees who choose not to attend “captive audience meetings”. Employees who opt out must be compensated if they work during these meetings. In addition, penalties for violating SB 399 can include compensatory and punitive damages.

Updates to Independent Contractor Requirements

SB 988, known as the “Freelance Worker Protection Act” requires that hiring parties and workers enter into written contracts if the services are valued in excess of $250. Contracts should demonstrate the validity of the independent contractor relationship and should include specific details about the rate of pay, compensation method, services to be provided, the identity and mailing address of the contracting parties, among other items. The contractors now have rights to bring a potential retaliation claim under the statute and the statute can even be enforced by public prosecutors.

Expanded Leave Rights for Victims of Violence

New legislation broadens the categories of individuals eligible for leave if they or their family members are victims of domestic violence, sexual assault, or stalking. The categories now include, but are not necessarily limited to, victims of crime or abuse, which can include domestic violence, sexual assault, stalking, or any act, conduct, or pattern of conduct that includes bodily injury or death to another, brandishing, exhibiting, or drawing a firearm or dangerous weapon, or a perceived or actual threat to use force against another to cause physical injury or death. Employers should update their leave policies to reflect these changes and ensure compliance with notification and documentation requirements.

Sick Leave for Agricultural Workers

Agricultural workers are now entitled to use paid sick leave when environmental conditions prove too hazardous to work due to, smoke, heat, or flooding conditions created by a local or state emergency. Employers in the agricultural sector must adjust their policies to provide the mandated sick leave and ensure proper accrual and usage tracking.

Amendments to the Private Attorneys General Act (PAGA)

In a surprising turn of events, California passed amendments to PAGA that are mostly employer friendly. A rare win for the employers in the legislature. These recent amendments limit the PAGA claims an employee can raise to only those claims which they personally experienced. The court also has discretion to limit PAGA claims to address manageability concerns. There is also an opportunity for employers to proactively correct Labor Code violations to minimize penalties if corrected within 60 days of receiving the notice. Employers with less than 100 employees might also have the option of submitting a cure plan to the LWDA within 33 days to avoid penalties. Employers with more than 100 employees have the option of seeking an early evaluation conference with a neutral evaluator who can assist with settling disputed claims early in the case. If you receive a PAGA notice, act immediately to start minimizing your potential liability.

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January 15, 2025

California's New Employment Laws for 2025

Learn about the statewide minimum wage increase, the ban on captive audience meetings, updates to independent contractor requirements, expanded leave rights, new sick leave policies for agricultural workers, and significant amendments to PAGA. Ensure your business remains compliant and informed.

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