The latest California legislative session ended on October 13, 2025, with Governor Newsom signing nearly 800 bills into law. Over a dozen of these bills are employment related. Here’s a review of the key laws California employers should understand.
SB 513: Preservation of Training Records as “Personnel Records.”
SB 513 broadens employers’ record-keeping requirements concerning personnel files. Right now, Labor Code Section 1198.5 gives California employees the right to “inspect and receive” a copy of the “personnel records” that their employer maintains on their performance or grievances. The new law amends § 198.5 to define “personnel records relating to the employee’s performance” to include “education or training records.” In addition, the law provides the types of information an employer must keep regarding to “education or training records.” To that end, the law requires an employee’s education or training records to include: (i) the name of the employee; (ii) the name of the training provider; (iii) the date of the training and its duration; (iv) the core competencies of a training, including skills in equipment or software; and (v) the resulting certification or qualification. The new record-keeping requirement goes into effect on January 1, 2026.
SB 294: The Workplace Know Your Rights Act.
This new law requires employers to provide all current employees and new hires with a standalone notice concerning workers’ rights before February 1, 2026. The notice must contain:
- The right to workers’ compensation benefits, including disability pay and medical care for work-related injuries or illness, as well as the contact information for the Division of Workers’ Compensation.
- The right to notice of inspection by immigration agencies pursuant to § 90.2(a).
- Protection against unfair immigration-related practices against a person exercising protected rights.
- The right to organize a union or engage in concerted activity in the workplace.
- Constitutional rights when interacting with law enforcement at the workplace, including an employee’s right under the Fourth Amendment to the U.S. Constitution to be free from unreasonable searches and seizures and rights under the Fifth Amendment to due process and against self-incrimination.
The bill would prohibit an employer from discharging, threatening to discharge, demoting, suspending, or in any manner discriminating or retaliating against an employee for exercising or attempting to exercise their rights under the bill. Damages for violations include temporary or preliminary injunctive relief, punitive damages, and reasonable attorney’s fees and costs. The penalty is up to $500 per employee for each day the violation occurs for most infractions, and a maximum of $10,000 per employee for illegal discriminatory conduct.
AB 692: Elimination of “Stay or Pay” Provisions in Employment Contracts.
AB 692 would, for contracts entered into on or after January 1, 2026, make it unlawful to include in any employment contract, or to require a worker to execute as a condition of employment or a work relationship a contract that includes, specified contract terms. This includes a term that requires the 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. The bill would declare these contracts as contracts that restrain a person from engaging in a lawful profession, trade, or business, and as void and contrary to public policy, except as provided.
SB 648 Gives Labor Commissioner Power to Issue Citations for Tip Theft.
This bill amends Section 351 of the California Labor Code to expressly authorize the Labor Commissioner to enforce that section through a civil action orthrough the issuance of a citation in accordance with Labor Code § 1197.1. Section 351 protects an employee’s right to their tips and gratuities. That law states that tips and gratuities are the “sole” property of the employee and prevents employers from collecting any portion of that tip or gratuity. The statute also prohibits employers from counting an employee’s tips and gratuities as a “credit” against their wages or deducting the cost of credit card processing fees from the amount of a tip or gratuity paid by credit card. This law becomes effective on January 1, 2026.
SB 809: Independent Contractors and Employee Vehicle Business Expenses.
This bill provides that mere ownership of a vehicle—including a personal vehicle or a commercial vehicle—used by an individual to provide labor or services for remuneration doesn’t make that person an independent contractor. The bill creates the Construction Trucking Employer Amnesty Program and requires employers to indemnify their employee for all necessary expenses or losses for the use of a vehicle owned by an employee and used by that employee in the discharge of their duties.
SB 642: The Pay Equity Enforcement Act.
SB 642, commonly known as the “Pay Equity Enforcement Act,” amends California’s Equal Pay Act and related pay disclosure provisions of the Labor Code. This bill changes the definition of “pay scale” to mean an estimate of this expected wage range that an employer reasonably expects to pay for the position upon hire and is made in good faith. SB 642 also prohibits an employer from paying employees at wage rates less than the rates paid to employees of another sex instead of the opposite sex, and would require a civil action to recover wages to be initiated within three years of the last date the cause of action happens. The bill provides that an employee is entitled to obtain relief for the entire period of time in which a violation of its provisions exists, not to exceed six years. Finally, the bill details that a cause of action happens: (i) when an alleged unlawful compensation decision or practice is adopted; (ii) when an individual becomes subject to the decision or practice; or (iii) when a person is impacted by the application of the decision or practice. The bill’s provisions don’t prohibit the application of prescribed legal doctrine. SB 642’s amendments become effective on January 1, 2026.
AB 1340: The Transportation Network Company Drivers Labor Relations Act.
AB 1340, known as the “Transportation Network Company Drivers Labor Relations Act” states that transportation network company (TNC) drivers have the right to: (i) form, join, and participate in the activities of TNC driver organizations; (ii) bargain through representatives of their own choosing; (iii) engage in concerted activities for the purpose of bargaining or other mutual aid or protection; and (iv) refrain from such activities. This bill requires all TNCs to submit certain information every quarter, including information identifying and related personal work information about TNC drivers to the board in a list format, as prescribed. It also requires TNCs and certified driver bargaining organizations to negotiate in good faith pursuant to the act and would create procedures for mediation and arbitration to reach agreements. Finally, this bill makes it an unfair practice for a TNC, an agent of a TNC, or a multi-company committee to fail or refuse to negotiate in good faith with a certified driver bargaining organization. It also makes it an unfair practice for a certified driver bargaining organization or its agents to fail to negotiate in good faith with a TNC or multi-company committee.
SB 590: Designated Person for Paid Family Leave.
SB 590 expands state leave rights and benefits to include events impacting a “designated person.” This term is defined “any care recipient related by blood or whose association with the individual is the equivalent of a family relationship.” As of July 1, 2028, covered workers will be able to use their leave benefits when they take time off to care for a seriously ill “designated person.” Employees must identify their “designated person” when they first file a claim for family temporary disability insurance benefits to care for a designated person.
SB 261: Penalties for Unpaid Wage Judgments.
SB 261 requires judgment debtors to be subject to a civil penalty no more than three times the outstanding judgment amount if a final judgment from the nonpayment of work performed is still unsatisfied after 180 days. This bill would also require that the judgment creditor, the Labor Commissioner, or public prosecutor as assignee of the judgment creditor, be awarded court costs and reasonable attorney’s fees. SB 261 becomes effective on January 1, 2026.
Judgment Debtor Employers Notice Requirement.
SB 355 requires, within 60 days of a final judgment being entered against an employer requiring payment to an employee or to the state that the judgment debtor employer provide certain documentation to the Labor Commissioner. That information includes: (i) the judgment is fully satisfied; (ii) bond has been posted; or (iii) the judgment debtor entered into an agreement for the judgment to be paid in installments and is in compliance with that agreement. Civil penalties would apply.
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With many new laws applicable to California employers, Eanet, PC wants all businesses to carefully review and update their policies and procedures to be certain that they don’t run afoul of the new legislation. Contact us with any questions.