California 2025 Employment Law Changes

As we head into 2025, several changes in California employment law will be critical to consider as businesses and employers update their policies. Below is an overview of employment law changes that will be effective in 2025 that California employers should consider as they plan for the new year.

Increased Protections for Independent Contractors and Freelance Workers

The Freelance Worker Protection Acts requires written contracts for freelancers earning $250 or more per engagement or aggregated with all contracts between the same hiring party and independent contractors within 120 days. The contract must be in writing, outline payment terms, project scope, and payment and services due dates.

The new law also protects freelance workers from retaliation from the hiring party and requires the hiring party to retain contracts for at least four years.

Businesses should ensure contracts are in place for all independent contractor engagements. These contracts should include:

1. The names and addresses of both parties;
2. An itemized list of all services to be provided by the freelance worker, their values, and compensation rate or method for determining it;
3. Payment date or the mechanism by which the date will be determined; and
4. Due dates for services rendered by the freelancer.

Employers should ensure they maintain records of any contracts with independent contractors for at least four years.

Vacation and Paid Family Leave Benefits

Employers may no longer require employees to exhaust two weeks of vacation leave before accessing state Paid Family Leave benefits. This means that employees will retain earned and unused vacation time upon their return from leave.

Employers should update their handbooks and policies to reflect this change.

Victim Time Off

The new law expands protections for employees taking time off due to “qualifying acts of violence,” including domestic violence, sexual assault, stalking and others. The law prohibits retaliation or discrimination against any employee who participates in this legal process, including taking time off for jury service, witness appearances, and where they are a victim and take time off under these protections. For employers with 25 or more employees, these protections are further expanded to include employees who take time off for purposes related to a family member who is a victim of a qualifying act of violence.

Employers can limit the total leave time taken, and reasonable accommodations may be required. Additionally, employers must allow employees to use available paid sick time for matters related to qualifying acts of violence, jury service, or witness appearances.

Employers must notify employees of their rights under this law at time of hire and upon request. Employers should consider updating their policies and handbook to comply with these new requirements.

Driver’s License Requirement Prohibited in Job Postings

A new amendment prohibits employers from requiring a driver’s license in job postings, applications, and other employment materials, unless:

1. the employer reasonably expects driving to be one of the job functions for the position, and
2. an alternative form of transportation would not be comparable in travel time or cost to the employer.

Employers should review employment documents including offer letters and job postings to ensure they only require licenses where truly necessary and in conformity with the exceptions listed above.

Intersectional Discrimination Protections and Definition of “Race” Expanded

Intersectional discrimination claims are now recognized, meaning employees can allege discrimination and harassment on the basis of a combination of two more protected traits. For example, an employee could file a discrimination claim based on the combined impact of age and gender.

The new law also expands the definition of “race” under FEHA to include traits commonly associated with race, including hair texture and protective hairstyles (including hairstyles such as braids, locs, and twists).

Employers should update their anti-discrimination policies and ensure HR staff are trained to consider multiple factors when investigating discrimination claims.Employee Rights and

Responsibilities Poster Requirement

The new law requires California employers to post a notice outlining employee rights and responsibilities under existing whistleblower laws. The notice must be in a font larger than 14-point and include the whistleblower hotline number.

Employers displaying the California Labor Commissioner’s model notice (which can be found here) will be compliant with the posting requirement.

Changes to Workers’ Compensation Notices

Employers must update their workers’ compensation notices to include (1) that employees have the right to consult a licensed attorney about their workers’ compensation rights, and (2) that attorney fees may be paid from the employee’s recovery if they pursue a claim.

Employers must display the workers’ compensation informational poster in a place that is visible to employees and provide new hires with a pamphlet outlining their rights and benefits. The California Department of Industrial Relations has updated the Notice and Time of Hire Pamphlet that employers can provide to their employees.

Minimum Wage Increases

Effective January 1, 2025, California’s minimum wage will increase to $16.50 for all employers regardless of size. Additionally, the minimum salary threshold for exempt employees will increase to $68,640 per year.

Certain industries have higher minimum wage requirements including fast food restaurant employees, certain healthcare workers, licensed physicians and surgeons, and computer professionals.

Employers should ensure that all their employees meet the minimum wage requirements and should post the minimum wage notices (which can be found here) in a conspicuous place in the workplace.

Private Attorney Generals Act (PAGA) Updates

2025 brings in major reforms to PAGA. Importantly for employers, the reforms allow employers to resolve potential violations and reduce their legal exposure. Employers who take all “reasonable steps” to comply with the California Labor Code may receive decreased penalties in PAGA lawsuits—penalties may decrease by up to 85% if violations are isolated, nonrecurring, or corrected within 60 days of receiving notice.

This makes it even more crucial for employers to review their compliance policies, conduct regular payroll audits, implement supervisor compliance training, and have a plan to take corrective actions upon notice of any violations.

The new PAGA reforms also extend a current PAGA exemption to construction industry employees working under collective bargaining agreements. While the PAGA exemption applies to certain construction industry employees, these employees can still bring legal claims related to discrimination, harassment, or federal or state civil rights law violations. Employers who hire construction employees should ensure that all labor agreements comply with this new law.

CAL/OSHA Indoor Heat Rule

Cal/OSHA’s Indoor Heat Illness Prevention Standard took effect earlier in 2024 and applies to most California workplaces where indoor temperatures reach 82 degrees or higher, including restaurants, warehouses, and manufacturing facilities.

Covered employers must implement several measures to comply with the rule, including but not limited to:

1. heat illness prevention plan
2. cool-down areas
3. drinking water
4. health monitoring
5. supervisor training
6. reporting time pay

Employers should review their workplace heat illness protocols to ensure compliance and avoid the hefty penalties this new rule imposes.

Captive Audience Meeting Restrictions

Under the Worker Freedom from Employer Intimidation Act, employers cannot require attendance at meetings focused on political or religious topics.

If an employer plans to hold such a meeting, the meeting must be voluntary, and employers should document voluntary attendance. Employers should update policies on meeting attendance and employee rights regarding participation.

OSHA Certification Requirements for Live Entertainment Events

Entertainment events vendors involved in live entertainment event setup, operations and teardowns must meet strict training and certification standards.

Vendors must certify that its employees and any subcontractors’ employees have completed Cal/OSHA-10, the OSHA-10/General Entertainment Safety training, or the OSHA-10 as applicable to their occupation; and Department Heads have completed the Cal/OSHA-30, OSHA-30/General Entertainment Safety training, or the OSHA-30, or equivalent training.

Contracts between vendors and event venues must (1) include the names of employees and subcontractors’ employees involved and (2) provide names and dates of their completed trainings and certifications.

Employers who are vendors involved in live entertainment event setups, operations, and teardowns should review their training requirements and contracts to ensure compliance with these new rules.

Paid Sick leave for Agricultural Employees

Agricultural workers can now use paid sick leave to avoid hazardous conditions during state or locally declared emergencies.

Social Compliance Audit Disclosure

Employers who voluntarily conduct social compliance audits, including assessing child labor compliance, are now required to publicly post audit findings. Employers who conduct these audits should ensure results are accessible on their websites.

Ensure Your Business is Compliant

As these legal changes come into effect, ensuring your business is fully compliant is more important than ever. Navigating new employment laws can be complex, but our experienced employment legal team is here to help. Whether you need a comprehensive review of your policies, employee handbook, or training programs to ensure compliance, Myers Widders provides tailored solutions to keep your business protected and up to date. Reach out to employment law partner, Steven Lee, today for a consultation and ensure a smooth transition into 2025: slee@nullmwgjlaw.com or 805-644-7188.

Written by Eleni A. Cotsis, Law Clerk