As we approach the midyear point, we wanted to review some of the new employment laws that went into effect this year and impact most California employers. This is not intended to be an exhaustive list. Should you have any specific questions about how these laws affect your organization, please reach out — we are here to help!
Minimum Wage and Salary Thresholds
Effective January 1, 2025, the statewide minimum wage increased to $16.50/hour for all employers, regardless of size.
Note: Local cities and counties may adopt higher minimum wages, which take precedence over the state minimum wage.
Examples of Local Minimum Wages:
City of Novato (based on employer size):
Very large employers (100+ employees): $17.27/hour
Large employers (26–99 employees): $17.00/hour
Small businesses (1–25 employees): $16.42/hour
San Francisco: Currently $18.67/hour; increases to $19.18/hour on July 1, 2025.
Emeryville: Currently $19.36/hour; increases to $19.90/hour on July 1, 2025.
Oakland: $16.89/hour
San Jose: $17.95/hour
Special Minimum Wage Exceptions:
Certain fast food workers: Minimum $20.00/hour.
Certain healthcare employees: Minimum $23.00/hour through June 30, 2025;
increases to $24.00/hour on July 1, 2025, and $25.00/hour on July 1, 2026.
Exempt Employee Salary Thresholds
To maintain exempt status (and avoid wage-and-hour requirements such as overtime pay), exempt employees must:
Earn a minimum salary of $68,640.00/year, and
Meet the exempt duties test.
Note:
In cities where the minimum wage is higher, the exempt salary requirement is also higher.
For example, beginning July 1, 2025, exempt employees in San Francisco must earn at least $79,788.80/year.
Changes to Leave Benefits
Paid Family Leave (AB 2123):
Employers can no longer require employees to use up to two weeks of accrued PTO or vacation before receiving Paid Family Leave benefits through the EDD.Domestic Violence/Crime Victims Leave:
Employees may use Paid Sick Leave if they or their family members are victims of acts of violence.
Employers must allow such leave under FEHA and provide reasonable accommodations, such as implementation of safety measures.
Protections for Independent Contractors and Freelancers
The Freelance Worker Protection Act (SB 988) establishes minimum requirements for freelance contracts, including:
Each party’s name and mailing address.
An itemized list of services provided, including value and method of compensation.
Payment due date (or a mechanism to determine it if unspecified).
Requirement for freelancers to submit a service summary to trigger payment.
Additional Requirements:
Companies must retain copies of contracts for at least 4 years.
Full payment must be made by the contract due date or within 30 days after work completion if no date is specified.
Hiring parties cannot pressure freelancers to accept lower compensation than agreed as a condition of timely payment.
Expanded Discrimination Protections (FEHA Updates)
The Fair Employment and Housing Act (FEHA) already prohibits discrimination based on protected characteristics such as:
Sex, race, color, religion, ancestry, national origin, disability, medical condition, genetic information, marital status, sexual orientation, citizenship, primary language, and immigration status.
New FEHA Amendments:
It is now illegal to discriminate based on a combination of two or more protected characteristics.
Employers are prohibited from requiring a driver’s license for employment unless driving is an essential function of the position.
Workplace Restraining Orders
Employers may now seek temporary restraining orders not only for violence or threats but also for harassment, defined as:
“A knowing and willful course of conduct directed at a specific person that seriously alarms, annoys, or harasses the person, and serves no legitimate purpose. The conduct must cause substantial emotional distress to a reasonable person and actually cause such distress.”
Captive Audience Meetings
Employers are now prohibited from holding mandatory meetings during working hours to discuss political or religious matters, including union organizing.
Questions?
If you have any questions about these new laws or how to ensure compliance within your organization, please don’t hesitate to reach out.
We are here to help!