Camron Dowlatshahi, partner at MSD Lawyers, today shared insights on how to navigate California's employment law landscape, one of the most dynamic and complex in the United States. Staying informed about these regulations is not just a matter of best practice but a legal necessity for employers and employees. Navigating this intricate web requires a comprehensive understanding of state mandates, ranging from wage and hour laws to anti-discrimination statutes.
Compliance is paramount for all businesses operating in the Golden State to avoid legal pitfalls and foster a positive work environment. Employees must also know their rights and protections under these laws to ensure rightful and fair treatment so they can advocate for themselves when necessary.
Key Aspects of California Employment Law
California employment law is unique due to its progressive nature and robust employee protections. Unlike federal law, which sets a baseline, California often goes further to safeguard workers' rights.
For example, California's minimum wage consistently exceeds the federal level, and the state provides more expansive leave entitlements. These differences highlight the importance of focusing specifically on California law for anyone working or employing individuals within the state.
Employers must be vigilant to ensure their current policies and practices align with these stringent state requirements, as non-compliance or complacency can lead to significant legal, reputational, and financial repercussions. Employees also benefit from understanding these enhanced protections, empowering them to recognize and address workplace violations.
Minimum Wage
Effective January 1, 2025, the new mandated minimum wage for all employers is $16.50 per hour. Additionally, fast food workers will earn $20.00 per hour starting April 1, 2024, under AB 1228. Certain healthcare workers earn between $18 and $25+ per hour in phases under SB 525. These sector-specific increases underscore the state’s ongoing efforts to address wage equity across industries.
Employee Protections
California offers broad employee protections through the Fair Employment and Housing Act (FEHA), which is now enforced by the California Civil Rights Department (CRD). FEHA covers various employment practices, including anti-discrimination, retaliation, and wrongful termination safeguards, ensuring that workers are treated fairly regardless of their status, background, or identity.
Leave Entitlements
California provides more generous leave entitlements than those required under federal law. For instance, SB 616 expands paid sick leave to five days or 40 hours annually. Additional leave provisions exist for circumstances such as family care, pregnancy, and issues related to domestic violence.
Retaliation Protections
Employees in California are legally protected from retaliation when they report workplace misconduct. This includes retaliation for reporting discrimination, harassment, unsafe working conditions, and wage violations or exercising their rights under various leave laws. These protections are critical to ensure employees can speak out without fear or danger of losing their jobs.
Wrongful Termination Protections Under FEHA
California's Fair Employment and Housing Act (FEHA), now administered by the Civil Rights Department (CRD), is a cornerstone of employee protection against discrimination, harassment, and retaliatory termination.
FEHA prohibits employers from wrongfully terminating employees based on several protected characteristics, ensuring a workplace free from bias. Protected categories include race, color, national origin, ancestry, sex, gender identity, sexual orientation, disability, medical condition, genetic information, pregnancy, religion, age (over 40), marital status, and more.
California is an at-will employment state; hence, employers can terminate employees without cause, provided the reason is not illegal. However, FEHA offers essential limits for this doctrine. Discriminatory or retaliatory terminations are unlawful, and protections also extend to employees engaging in protected activities such as filing complaints or participating in lawful investigations.
California law further recognizes "implied contracts," meaning that employer actions or assurances may create a reasonable expectation of continued employment, even absent a written contract.
Additionally, the Private Attorneys General Act (PAGA) allows employees to rightfully file lawsuits on behalf of themselves and others for Labor Code violations, which may arise after reporting wrongful termination or other workplace misconduct, reflecting the state's strong commitment to labor rights enforcement.
Expanded Protections: Cannabis, Intersectionality, and Safety
As of January 1, 2024, under AB 2188, California prohibits employers from discriminating against their employees for off-duty cannabis use, provided it does not impair performance or safety-sensitive duties. Exceptions apply to federal contractors and safety-related roles.
FEHA already protects against discrimination based on multiple overlapping characteristics (intersectionality), and recent CRD enforcement emphasizes this.
Meanwhile, SB 553 (2023) requires California employers to implement written workplace violence prevention plans by July 1, 2024, highlighting a new era of proactive safety in employment law.
Reimbursement and Remote Work
California Labor Code §2802 requires all the state's employers to reimburse their employees for incurred necessary business expenses. For remote workers, this includes partial reimbursement of internet and phone expenses if essential for work.
Resources for Employers and Employees
Employers can access compliance resources from the California Chamber of Commerce and use HR management software like Gusto to automate payroll, track labor law updates, and maintain accurate employee records. The Society for Human Resource Management's (SHRM's) study notes that integrating HR tech can reduce compliance violations by up to 20 percent.
For up-to-date guidance, employees should consult the official channels of the California Department of Industrial Relations (DIR) and the California Civil Rights Department (CRD) websites. Legal aid organizations provide support to workers facing wrongful termination or wage violations. Employees facing discrimination or retaliation should consult employment law attorneys early to understand their options.
Stay Compliant and Empowered: Your Next Steps in California Employment Law
California's employment laws are comprehensive and strongly favor employee protection, requiring careful attention from employers and workers. Understanding key factors such as wrongful termination protections under FEHA, minimum wage obligations, leave entitlements, expense reimbursements, and new safety mandates is essential to maintaining compliance.
Now is the time to assess your workplace policies, update your employee handbooks, and consult with qualified legal counsel to ensure you're compliant and prepared for what's ahead. You can foster a compliant, equitable, and safe workplace by utilizing available tools and staying informed on legislative changes. Staying proactive is the best strategy to thrive in California's dynamic legal environment.
