Author: David Israel is the Corporate Counsel for Innovative Employee Solutions
Key Takeaways:
- California’s evolving employment laws require businesses to stay updated to ensure compliance and avoid legal issues.
- New laws include protections for off-duty cannabis use, increased wage replacement for family leave and disability insurance, prohibition of noncompete agreements, and mandatory Workplace Violence Prevention Plans.
- Businesses must update employee handbooks, communicate new policies, and train staff on Workplace Violence Prevention Plans to ensure compliance.
- Legal Employers of Record or Agents of Record like Innovative Employee Solutions help organizations navigate complex California labor regulations and maintain compliance across multiple regions.
California is known for its dynamic and stringent labor laws, frequently leading the nation in introducing legislation aimed at increasing worker protections. This ever-evolving legal landscape makes it crucial for businesses to stay up to date with the latest changes to ensure compliance and avoid potential legal issues. This blog provides a critical analysis of the latest legislative updates in the state and offers actionable advice for employers on navigating these changes effectively.
Key Legislative Updates in California
Several significant pieces of new California legislation have recently been enacted aimed at increasing worker protections. These include new and additional protections against discrimination, increased transparency, and expanded medical and leave protections. Understanding these laws is essential for companies to ensure compliance and maintain smooth operations. Here is an overview of some of the most recent updates to California’s employment laws:
1. Off-Duty Cannabis Use Protection (AB 2188).
Effective January 2024, employees’ personal cannabis use — off-duty and away from the workplace — is protected under AB 2188, so long as it doesn’t affect their work performance. Employers cannot use a drug screening result for historical cannabis use to make hiring decisions or terminate an employee based on their off-site use.
2. Paid Family Leave and Disability Insurance Update (SB 951)
Starting in January 2025, SB 951 will increase the wage replacement rate for paid family leave and state disability insurance. This update aims to provide greater financial support to employees during family leave or disability periods.
3. Prohibition of Noncompete Agreements (SB 699)
California continues to lead in prohibiting noncompete agreements with the passing of SB 699. As of January 2024, employers can no longer enforce these provisions within California, regardless of when or where the agreement was signed.
4. Workplace Violence Prevention Plan (SB 553)
By July 1, 2024, California workplaces were required to have Workplace Violence Prevention Plans (WVPP) in place. These plans, which can be standalone or part of injury prevention plans, must be reviewed annually or when a deficiency is recognized. Remote employees who choose their work location are exempt from this requirement.
Impacts of New California Legislation on Businesses
These new laws significantly impact how companies hire and manage employees. Employers should take proactive steps to maintain compliance with California labor regulations. For instance, businesses must update employee handbooks to reflect new policies, such as the inclusion of a “designated person” for family and medical leave and the new antidiscrimination provisions against cannabis use. Make sure all new policies are clearly outlined and communicated to employees.
Ensuring all employees are aware of and trained on the WVPP and other new laws and updated policies is also crucial. Although the WVPP law is new, enforcement is expected, especially alongside other Cal/OSHA matters. California has a history of strict enforcement of workplace regulations, and the introduction of the WVPP will likely be no different.
Regular training sessions and clear communication will be key in avoiding penalties and ensuring a safe workplace environment. Employers must also keep detailed records of training and plan updates to demonstrate compliance in case of inspections.
A legal Employer of Record (EOR) or Agent of Record (AOR) is particularly beneficial for staying compliant amid shifting employment laws in states like California. At Innovative Employee Solutions (IES), for example, we stay abreast of the latest developments in workplace law, both domestically and globally, implementing necessary policy changes to ensure clients remain compliant with new regulations. Our expertise in navigating the complex regulatory landscape helps businesses adapt to changes seamlessly, allowing them to focus on their core operations. And for companies operating in multiple regions, we provide consistent compliance management across jurisdictions, making it easier to manage a diverse workforce.
Staying compliant with new California labor regulations is essential for businesses to thrive. By understanding these legislative updates and taking proactive steps, employers can ensure smooth operations and avoid potential legal issues. IES is here to support you through these changes, ensuring your organization is well-prepared to meet new regulatory demands.
For more information on how IES can help your business navigate California’s evolving legal landscape, contact us today.
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David Israel is Corporate Counsel for Innovative Employee Solutions (IES), a leading provider of remote and contingent workforce solutions specializing in U.S. and global Employer of Record, Agent of Record, and Independent Contractor compliance services in 150+ countries. Founded in 1974, IES is a woman-owned business, certified by the WBENC, and partners with companies to provide compliant employment solutions that empower people’s lives.
