2024 New Employment and Business Laws in California

California's New 2024 Employment and Business Laws

At the start of 2024, several new laws will cause a shift in the employment world in California. This article will provide a brief description of these news laws that will affect employers in California as of January 1, 2024.

Enhanced Paid Sick Leave (SB 616)

On October 4, 2023, Governor Gavin Newsom signed Senate Bill (“SB”) 616 that would expand California’s sick pay law. The expansion amends the Healthy Workplaces, Healthy Families Act of 2014 and apply to nearly all employees who work at least thirty days in a year. Some of the key changes are summarized below:

• The amount of paid sick leave for full-time employees increases from 24 hours (3 days) to 40 hours (5 days), whichever is greater.

• The accrual cap on paid sick leave for full-time employees increases from 48 hours (6 days) to 80 hours (10 days).

• Requirements for accrual of paid sick leave have changed. Both full-time and part-time employees must accrue a minimum of 1 hour of paid sick leave per 30 hours worked. For employers that use a different accrual system other than the 1 hour of paid sick leave per 30 hours worked, SB 616 requires that employees accrue at least 24 hours (3 days) of paid sick leave by the employee’s 120th day of employment and accrue 40 hours (5 days) of paid sick leave by the employee’s 200th day of work.

• Employers must allow employees to use their available sick balance beginning 90 days after the start of employment.

• Employers cannot prevent employees from using less than 40 hours per year of the paid sick leave they have accrued.

• Employers cannot limit less than 40 hours of accrued paid sick leave to carry over to the following year. This means that employers must carry over a minimum of 40 hours of any unused, accrued paid sick leave to the following year).

• Employees who work in California are entitled to paid sick leave if they work for the same employer for 30 or more days within a year from the start of their employment.

• Employers must provide written notice to employees regarding the amount of paid sick leave they have available.

• Employers

New Reproductive Loss Leave (SB 848)

On October 11, 2023, Governor Gavin Newsom signed SB 848 that provides reproductive loss leave. The state will require employers with 5 or more employees to provide eligible employees up to 5 days of leave following a reproductive loss, including failed adoption, surrogacy, or assisted reproduction. To be eligible for reproductive loss leave, an employee must have worked at least 30 days for the employer before the start of the leave. Employees also must complete their leave within 3 months after experiencing reproductive loss unless they are under another state or federal law that provides them leave before or immediately after the event.

Noncompetition Agreement Restrictions (SB 699, AB 1076)

SB 699

On September 1, 2023, Governor Gavin Newsom signed SB 669 that would expand California’s existing public policy against noncompete agreements. SB 669 adds section 16600.5 to the Business and Professions Code Section 16600 and makes clear that the existing law prohibits noncompete agreements regardless of where or when the agreement was signed, even if the covenant was signed out of the state. An employer will commit a civil violation if it enters into or attempts to enforce a void noncompete agreement.

AB 1076

On October 13, 2023, Governor Gavin Newsom signed Assembly Bill (“AB”) 1076 amending Business and Professions Code Section 16600 by codifying the California Supreme Court’s holding in Edwards v. Arthur Andersen LLP (2008) 44 Cal.4th 939, and “void the application of any noncompete agreement in an employment context, or any noncompete clause in an employment contract, no matter how narrowly tailored.” The new law also requires employers to notify current or former employees, employed after January 1, 2022, and who had contracts containing a noncompete clause covered by section 16600, that the noncompete clause is void. Employers have until February 14, 2024, to provide written notice to the last known address or email address of the employee.

Cannabis Use Protections (AB 2188, SB 700)

AB 2188

On September 18, 2022, Governor Gavin Newsom signed AB 2188 which makes it unlawful for an employer to discriminate against individuals in hiring, termination, or any term or condition of employment, or to otherwise penalize an individual for cannabis use or drug test results showing non-psychoactive cannabis metabolites. This law does not allow employees to possess or use marijuana at the workplace, nor does it interfere with an employer’s right to maintain a drug-free and alcohol-free workplace.

SB 700

Like AB 2188, on October 7, 2023, Governor Gavin Newsom signed SB 700, which also makes it unlawful under the Fair Employment and Housing Act (FEHA) for an employer to discriminate against a job applicant based on their information regarding cannabis use that is revealed from their criminal history.  

Updated Wage Theft Prevention Notice (AB 636)

On October 8, 2023, Governor Gavin Newsom signed AB 636 requiring that employers provide nonexempt employee with a written notice regarding their pay rates, designated paydays, applicable overtime rates, and other wage information. Employers may use their own forms or the California Department of Industrial Relations (DIR)’s “Notice to Employee Labor Code Section 2810.5” to provide notice. The written notice must be provided at the time of hire and within 7 days of a change, if the change in employees’ pay stubs for the following pay period reports no changes.

Workplace Violence Prevention Plan (SB 553)

On September 30, 2023, Governor Newsom signed SB 553 which requires employers to implement a workplace violence prevention plan with specific requirements. The law exempts workplaces with less than 10 employees, but these workplaces must still comply with the injury and illness prevention Cal/OSHA regulations.

Anti-Retaliation Protections (SB 497)

On October 8, 2023, Governor Gavin Newsom signed SB 497 amending California Labor Code sections 98.6, 1102.5, and 1197.5 that would create a “rebuttable presumption of retaliation” if an employee experiences adverse employment actions within 90 days of engaging in any protected activity found in these labor code sections. This law makes it easier to file a claim against the employer and entitles the prevailing plaintiff civil penalties for each violation.

Changes in Arbitration Enforcement (SB 365)

On October 10, 2023, Governor Gavin Newsom signed SB 365 amending the existing law and providing that a party appealing an order denying a motion to compel arbitration will not be entitled to an automatic stay.