Labor and Employment Developments in California in 2025 | Troutman Pepper Locke
California often finds itself at the forefront of labor and employment law, with changes affecting employers each year. This year is no different. In 2025, employers can expect a variety of impactful changes to the legislative scheme in California, including five noteworthy labor and employment developments that California employers should be ready for, plus Private Attorneys General Act (PAGA) reforms that provide opportunities for employers to reduce their exposure to penalties for alleged Labor Code violations.
Expanded Crime and Violence Victim Leave. Under AB 2499, the California legislature expanded the enforcement provisions of the California Fair Employment and Housing Act to include certain time off provisions relating to crime or violence victim status. Essentially, this law now affirmatively prohibits an employer from discharging or otherwise discriminating against an employee who is a victim (or who has a family member who is a victim) of a qualifying act of violence and takes time off work associated with such violent act. Employers can limit the amount of such leave, such as to 12 weeks if the employee is the victim or 10 days if the employee’s family member is the victim. In addition, employers must allow employees to use their accrued sick leave time for such purposes, which may require an update to paid sick leave policies. AB 2499 requires employers to inform employees of their rights under the bill upon hire, annually, upon request, and any time an employee reports that they or their family member is a victim. The California Civil Rights Department (CRD) will publish a form notice about these protections by July 1. After this notice is published, employers must provide a substantially similar notice to employees and should update their leave policies for victims of violence to comply with the new guidelines
Prohibition on Mandatory PTO Before Paid Family Leave. AB 2123 removes an employer-friendly component and requirement of Paid Family Leave (PFL). Previously, employers could require an employee to take up to two weeks of earned but unused vacation/PTO before, and as a condition of, the employee’s initial receipt of PFL benefits. Under AB 2123, this practice is no longer permitted.
Expanded Protected Classes. AB 1815 expands the definition of race discrimination (and the list of protected characteristics, generally) under the California Fair Employment and Houston Act (FEHA) to include traits associated with race, including but not limited to, hair texture and protective hairstyles. (Note that, previously, under the FEHA, race included traits “historically” associated with race, including hair texture and styles, such as braids, locs, and twists. AB 1815 removes the term “historically” from the definition).
In addition, SB 1137 amends California’s anti-discrimination laws (Unruh Act, Education Code, and FEHA) to explicitly prohibit discrimination based on the intersection of two or more protected traits, acknowledging that individuals may face discrimination for belonging to multiple protected classes.
Elimination of Driver’s License Requirement in Hiring Process. SB 1100 amends the FEHA to make it an unlawful employment practice for an employer to include statements about the need for a driver’s license in job advertisements, postings, applications, and similar employment material, unless the employer reasonably believes or expects (1) driving to be one of the job functions for the position, and (2) that using an “alternative form of transportation” (e.g., taxis, walking, bike, carpool, rideshare) would not be comparable in travel time or cost to the employer.
New Posting Requirements. AB 2299 adds another poster to this list of posters and notices employers must provide to employees, to advise them of their rights. Beginning January 1, employers are required to post a specific notice drafted by the labor commissioner outlining employee rights and responsibilities under whistleblower laws. The new required poster can be found here.
PAGA Reforms. As a reminder, as of June 2024, employers have additional opportunities to limit their exposure to penalties under the Private Attorneys’ General Act (PAGA). For example, PAGA penalties are capped at 15% of an employer’s penalty liability if an employer demonstrates it took all reasonable steps to comply with the law before receiving the notice of violation or a request for personnel records. After receiving the notice of violations, penalties are capped at 30% of an employer’s penalty liability if an employer has taken all reasonable steps to comply with the provisions identified in the notice within 60 days. “All reasonable steps” may include pay practice audits, responding to the audit results, disseminating lawful written policies regarding the alleged violations, training supervisors on Labor Code and wage order compliance, or taking corrective action with supervisors. In addition, the PAGA reforms provide new procedures to promptly cure violations, which depend on the size of the employer and other circumstances. These reforms reward employers that are proactive in auditing and correcting pay practices that fall short of the technical requirements of the Labor Code. For a more in depth look at these PAGA reforms please consult the article linked here.
The new bills detailed above may require various policy and practice changes. Our attorneys have closely followed these developments and are available to assist employers with their compliance efforts.
