Employers, are you ready for 2025 and changes to California employment law? Effective January 1, 2025, the following laws will take effect.
Minimum Wage Increase
The general statewide minimum wage will increase by 50 cents to $16.50 per hour. Please also remember that many cities, counties, and municipalities require a higher minimum wage than the statewide minimum.
New Rules for Paid Family Leave and Use of Vacation Time
Assembly Bill (“AB”) 2123 eliminates an employer’s ability to require employees to use accrued vacation time before an employee receives benefits under California’s Paid Family Leave (“PFL”) program. Under current law, employers can require employees to use up to two weeks of accrued vacation before the employee can receive PFL benefits. Employers can no longer require the use of accrued vacation time before an employee receives PFL benefits.
Clarification of Anti-Discrimination Laws
California passed two significant laws that clarify and codify the importance of anti-discrimination measures in the state:
Removal of “historically” from definition of traits associated with race
First, Assembly Bill (“AB”) 1815 amends and clarifies the definition of “race” in the anti-discrimination provisions of California’s Government Code and Education Code, including in California’s CROWN (Creating a Respectful and Open World for Natural Hair) Act, to remove the word “historically [associated with]” from the definition of “race” under these laws. Previously, the CROWN Act stated that, “‘Race’ is inclusive of traits historically associated with race, including, but not limited to, hair texture and protective hairstyles.” Under AB 1815, the word “historically” is removed, so that this provision now reads, “‘Race’ is inclusive of traits associated with race, including, but not limited to, hair texture and protective hairstyles.”
Legislative analysis of AB 1815 states that this change was made because: “The word ‘historically’ is an ambiguous term that does not add anything of importance to the definition. It is not clear, for example, what would constitute a ‘historically’ associated trait, as opposed to, for example, a ‘culturally’ or ‘socially,’ or biologically’ associated trait. . . It should not matter why the trait is associated with race, so long as the trait is sufficiently associated with race to serve as a proxy for racial discrimination.”
Prohibition on discrimination based on “intersectionality” of protected characteristics
Second, Senate Bill (“SB”) 1137 makes California the first state to prohibit discrimination based on “intersectionality,” or the combination of two or more protected characteristics. SB 1137 defines “intersectionality” as “an analytical framework that sets forth that different forms of inequality operate together, exacerbate each other, and can result in amplified forms of prejudice and harm.” While discrimination based on multiple protected characteristics was already prohibited by case law, SB 1137 officially codifies this concept into statute.
Restrictions on Driver’s License Requirements in Job Postings
Senate Bill (“SB”) 1100 makes it unlawful for employers to require applicants to have a driver’s license unless both: (1) the employer “reasonably expects” driving to be one of the job’s functions, and (2) the employer “reasonably believes” that alternative transportation would not be comparable in travel time or cost to the employer. In application, this means that employers should pause and consider whether requiring a driver’s license is truly a necessary function for the job being posted.
Freelance Worker Protection Act (“FWPA”)
Senate Bill (“SB”) 988 enacts the Freelance Worker Protection Act (“FWPA”), which imposes minimum requirements on contracts between a hiring party and a “freelance worker” (i.e., an independent contractor who meets the definition below). Under the new law, “freelance worker” is defined as a person or organization:
- Composed of no more than one person, whether or not incorporated or employing a trade name;
- That is hired or retained as a bona fide independent contractor by the hiring party to provide “professional services” (as defined under the California Labor Code); and
- Who provides services for $250 or more. The $250 threshold applies to all contracts for services between the hiring entity and the contractor during the preceding 120 days.
Under SB 988, an agreement between a hiring party and a freelance worker must be in writing and include key items of information, such as an itemization of all services to be provided by the contractor and the dates for payment. Additionally, once a freelance worker has started providing services, the hiring entity is prohibited from requiring, in order to receive timely payment, that the worker accept less compensation or provide more services than previously agreed upon.
The FWPA applies to contracts entered into or renewed on or after January 1, 2025.
Freelance workers who believe this law has been violated can sue for violations and recover reasonable attorneys’ fees and costs, injunctive relief, and other remedies deemed appropriate by the court. The amount of damages recoverable depends upon the violation.
Expanded Protections for Victims of Crime or Abuse
Assembly Bill (“AB”) 2499 expands workplace protections for victims of crime or abuse by amending the provisions for time off related to jury duty, court appearances, and victim-related activities. Under the law, employers cannot discriminate against an employee for taking time off for jury service, to appear in court as a witness under court order, or to take time off as a victim of a qualifying act of violence (defined below). Additionally, employers with 25 or more employees cannot discriminate or retaliate against an employee who is a victim (or who has a family member who is a victim) of a qualifying act of violence for taking time off for other specific purposes.
The new law also permits the use of paid sick leave, vacation, personal leave, or other compensatory time off that is available unless otherwise provided in a collective bargaining agreement.
Importantly, AB 2499 introduces a clear definition of “qualifying acts of violence,” which means any of the following, regardless of whether anyone is arrested for, prosecuted for, or convicted of committing any crime:
- Domestic violence
- Sexual assault
- Stalking
- An act, conduct, or pattern of conduct that includes:
- An individual causes bodily injury or death to another
- An individual exhibits, draws, brandishes, or uses a firearm or other dangerous weapon, with respect to another
- An individual uses or makes a reasonably perceived or actual threat of use of force against another to cause physical injury or death.
Employers should take note of the above expansion to victims’ rights, and revise their leave policies accordingly.
In Conclusion…
The above is merely a summary of some but not all of the key changes to California employment law for 2025. We hope that this update will help you to take a proactive approach to fostering a workplace environment that is both legally compliant and employee friendly in 2025. Employers should also reach out to their employment counsel with any questions regarding these pending changes.
