Stay Ahead of the Curve:
Covering payroll & HR basics, industry trends, and important legislation affecting employers
Stay Ahead of the Curve:
Covering payroll & HR basics, industry trends, and important legislation affecting employers
California Labor
Updates for 2026
California's 2026 employment law updates significantly expand wage standards, contract restrictions, and employee notice requirements. The majority of these changes are enforced by the California Department of Industrial Relations (DIR) and the Civil Rights Department (CRD).
Wages and Compensation
Minimum Wage Increase: The statewide minimum wage rises to $16.90 per hour for all employers.
Exempt Salary Threshold: Minimum annual salary for exempt employees increases to $70,304.
Computer Professionals: Minimum hourly rate rises to $58.85 ($122,573.13 annually).
Official Source: DIR Minimum Wage Guide.
Equal Pay (SB 642): Expands the Equal Pay Act to prohibit disparities based on "another sex" rather than just the "opposite sex".
Broadened "Wages": For equal pay claims, "wages" now includes stock, stock options, bonuses, travel reimbursements, and other non-cash benefits.
Reference: SB 642 Bill Text.
Tip Protection (SB 648): Grants the Labor Commissioner express authority to issue citations for tip theft.
Processing Fees: Prohibits deducting credit card processing fees from employee tips.
Reference: Labor Commissioner's Office.
Unpaid Wage Judgments (SB 261): Employers with unsatisfied wage judgments for over 180 days may face penalties up to three times the judgment amount.
Employee Contracts and Agreements
Ban on "Stay-or-Pay" (AB 692): Prohibits most contracts requiring employees to repay "debts" (e.g., training or relocation) if they leave before a set period.
Exceptions: Allows specific, separate agreements for unearned discretionary bonuses or truly transferable credentials.
Reference: AB 692 Bill Text.
Worker Recall Rights (AB 858): Extends COVID-era right-to-rehire protections for hospitality and building service workers until January 1, 2027.
Notices and Personnel Records
Workplace Know Your Rights Act (SB 294): Effective February 1, 2026, employers must provide a standalone annual notice covering workers' compensation, immigration, and union rights.
Emergency Contacts: By March 30, 2026, employers must allow employees to designate an emergency contact to be notified if the employee is arrested or detained at the worksite.
CalWARN Notice Expansion (SB 617): Layoff notices must now include local workforce development board contact info and a description of CalFresh food assistance.
Training Records (SB 513): Redefines "personnel records" to include detailed education and training logs (provider, duration, and competencies).
Official Source: DIR Personnel Files FAQ.
Compliance and Reporting
Pay Data Reporting (SB 464): Mandates separate storage of demographic data from personnel files. Starting with the May 2027 filing (for 2026 data), reporting categories expand from 10 to 23 categories.
Official Source: Civil Rights Department Pay Data Portal.
Sexual Assault Claims (AB 250): Reopens a window (Jan 2026–Dec 2027) for filing previously time-barred sexual assault claims involving employer "cover-ups".
AI in Hiring: New CRD regulations (effective late 2025) require anti-bias controls and four years of recordkeeping for Automated Decision Systems used in 2026 hiring
Legal Disclaimer: The materials, content, opinions, and resources provided on this website are for general informational purposes only and do not constitute legal advice. PCS Prostaff is not a law firm and does not provide, interpret, or represent legal counsel. No attorney-client relationship is created or implied through the use of this website or its resources. Users are strongly encouraged to seek independent legal advice from a qualified attorney or other appropriate professional before implementing any policies, procedures, or materials referenced herein. PCS Prostaff expressly disclaims any responsibility or liability arising from reliance upon the information contained on this site.
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