Workplace-related artificial intelligence (AI) or automated technology was a primary subject of the California Legislature’s 2025-2026 session.
If the governor signs these bills, California employers may see several new requirements concerning AI-driven surveillance tools, automated decision systems, and other emerging workplace technologies.
Here’s a look at a number of bills that would impose obligations on California employers. Governor Newsom must sign these bills before September 30th. However, if he doesn’t take action by that date, the bills will become law without his signature. Note that California laws take effect on January 1st of the year following enactment unless a different effective date is specified in the bill.
SB 947: Automated Decision Systems in Employment
As discussed earlier this year, this bill imposes significant safeguards on how California employers can use automated decision systems (ADS) in disciplinary and termination decisions. If enacted, SB 947 would become effective July 1, 2027. This would allow employers six more months to prepare.
SB 947 would prohibit an employer from using an ADS to perform certain functions and would restrict the purposes for and the way in which such systems are used.
The bill would authorize a worker to request, and require an employer to provide, a copy of the most recent 12 months of the worker’s own data primarily used by an ADS to make a disciplinary, termination, or deactivation decision, as specified. In addition, the bill would require an employer that uses an ADS to help in making a disciplinary, termination, or deactivation decision to provide the affected worker with a written post-use notice. Further, this piece of legislation would prohibit an employer from discharging, threatening to discharge, demoting, suspending, or in any way discriminating or retaliating against any worker for taking certain actions asserting their rights under the bill.
The bill would require the Labor Commissioner to enforce the bill. It would also authorize, in the alternative, any worker who has suffered a violation of these provisions to bring a civil action for damages, and authorize a public prosecutor to bring a civil enforcement action. The bill would provide specific relief that a plaintiff could seek and the penalties for an employer that violates the Act. This includes a $500 civil penalty and punitive damages.
The law states that employers can’t rely solely on an ADS when making a disciplinary, termination, or deactivation decision.
SB 951: Technological Displacement: Cal/WARN Act Notice Requirements Amended
SB 951, the California Worker Technological Displacement Act, would require a covered employer to provide at least a 90-day advance written notice before any technological displacement or termination of contract affecting 25 or more workers or 25% of the workforce (whichever is less). The bill would require an employer to provide notice to affected employees, the Employment Development Department, and specified state and local entities.
SB 951 would require a covered employer to provide a “written technology hiring disruption notice” to the Employment Development Department and specific local entities when it executes a technological reduction in hiring or cessation in hiring due to the adoption of artificial intelligence or other automating technology. The notice must contain specific information, as covered in our earlier post.
This law expands the current Cal/WARN Act notice requirements. If passed, employers would need to include additional AI-specific disclosures in their Cal/WARN notices when a mass layoff, relocation, or termination is “in whole or in substantial part” a result of an AI system or other automated technology replacing or automating employment positions.
For covered employers with more than 100 workers, the bill would entitle workers impacted by technological displacement or termination of contract to a right of first bid on other positions with the company and would prohibit discharge of those workers during a 90-day period from when notice is provided.
In addition, a covered employer that doesn’t provide notice must give back pay and benefits to each affected employee for a maximum of 60 days or half the number of days the employee was employed (whichever is shorter). The bill would also impose a $500 civil penalty for each day of the covered employer’s violation.
SB 951 also provides the procedures for reporting violations to the commissioner and filing a civil action in court.
AB 1883: Workplace Surveillance Tools (Emotion Recognition & Neural Data)
Current state law establishes the Division of Labor Standards Enforcement within the Department of Industrial Relations and authorizes the division, which is headed by the Labor Commissioner, to enforce labor laws of the state.
This bill would, with some exceptions, prohibit an employer from using a workplace surveillance tool that uses AI to, among other things, collect neural data or recognize an individual’s emotional state.
“Neural data” means information that is generated by measuring the activity of an employee’s central or peripheral nervous system, and that is not inferred from nonneural information. The bill also defines an employer to include a governmental entity, including, among other entities, charter cities and the University of California.
“Workplace surveillance tool” is defined as:
Any system, application, instrument, or device that collects or facilitates the collection of employee data, activities, communications, actions, biometrics, or behaviors by means other than direct observation by a person, including, but not limited to, video or audio surveillance, continuous incremental time-tracking tools, geolocation, electromagnetic tracking, photoelectronic tracking, or that utilizes a photo-optical system or other means.
AB 1883 would authorize the Labor Commissioner or a public prosecutor to enforce the bill’s provisions and would subject an employer who violates the bill’s provisions to a civil penalty of up to $500 for each violation.
AB 1331: Workplace Surveillance
This bill would restrict the use of workplace surveillance tools by employers, including by prohibiting an employer from monitoring or surveilling employees in a workplace bathroom.
“Workplace surveillance tool” means:
A system, application, instrument, or device that collects or facilitates the collection of employee data, activities, communications, actions, biometrics, or behaviors by means other than direct observation by a person, including, but not limited to, video or audio surveillance, continuous incremental time-tracking tools, geolocation, electromagnetic tracking, photoelectronic tracking, a photo-optical system, or other means. “Workplace surveillance tool” does not include smoke or carbon monoxide detectors or weapon detection systems that automatically screen a person’s body.
If passed, the bill would subject an employer to a civil penalty of up to $500 for each violation.
Takeaway
California employers that use AI to monitor, evaluate, or discipline employees should understand that the laws may become more restrictive.
Contact Eanet, PC for more information and strategies on how to address AI in the workplace.
About the author
Danielle G. Eanet, Esq.
Danielle is a shareholder at Eanet, PC, a Los Angeles litigation boutique. She defends employers in discrimination, harassment, wage-and-hour, PAGA, and trade secrets matters in California state and federal court, and previously practiced at Littler Mendelson, the world's largest employment law firm. She co-authored the intellectual property chapter of The Littler Mendelson Guide to International Employment and Labor Law (LexisNexis) and is regularly quoted on California employment law developments.