With the new year comes a variety of new employment laws in California, introducing changes that impact employers and employees across various sectors.
From minimum wage increases and overtime exemption rates to groundbreaking protections for freelance workers and expanded anti-discrimination laws, these updates reflect state lawmakers’ commitment to strengthening workplace rights and regulations.
Duckor Metzger & Wynne, APLC’s Employment & Labor Law attorneys created this comprehensive guide to provide an overview of key legislative changes, including new wage standards, employee protections, and procedural updates, ensuring you stay informed and prepared for compliance in 2025 and beyond.
All laws took effect Jan. 1, 2025, unless otherwise noted.
New Minimum Wages for California and San Diego Workers
California’s minimum wage increased from $16 per hour to $16.50 per hour for all employers*, regardless of size. This adjustment also impacts the minimum salary for full-time exempt employees, which increased from $66,560 to $68,640 annually ($5,720 per month). *Fast food restaurant and healthcare facility employers have a higher minimum wage.
In the City of San Diego, the minimum wage increased to $17.25 per hour.
SB 828 – Minimum Wage for Healthcare Workers
In 2023, Senate Bill 525 established gradual minimum wage increases for certain healthcare workers in California. In 2024, SB 828 was enacted to delay the implementation of the new wage increase on the previously prescribed schedule by one month. SB 525 established four distinct minimum wage levels for healthcare facilities, all of which were affected by SB 828:
- Accelerated minimum wage for healthcare facilities with more than 10,000 full-time equivalent employees (FTEs): For these facilities, the minimum wage will be $23 per hour until June 30, 2025. It will then increase to $24 per hour from July 1, 2025, to June 30, 2026.
- Delayed minimum wage for rural independent hospitals and hospitals with a high or elevated government payor mix: For these facilities, the minimum wage will be $18 per hour until June 30, 2025, with annual increases of 3.5% through June 30, 2033.
- Specific minimum wage for clinics: For unaffiliated primary care clinics, community clinics, rural health clinics, and certain urgent care clinics, the minimum wage will be $21 per hour until June 30, 2026.
- Graduated minimum wage for all other healthcare facilities: For all remaining covered healthcare facilities, the minimum wage will be $21 per hour until June 30, 2026.
SB 828 also made legislative findings and declarations that access to quality healthcare and the stability of the healthcare system is a matter of statewide concern and not a municipal affair. Therefore, the wages, salary, or compensation for covered healthcare facility employees provided by SB 828 and SB 525 apply to all cities and counties, including charter cities, charter counties, and charter cities and counties during the provided periods.
Overtime Exemption Rates for Computer Software Employees and Physicians
For computer software employees and licensed physicians to be considered exempt from overtime pay in California, the employees must meet specific criteria, including a specified overtime exemption rate of pay. The Department of Industrial Relations adjusts the overtime exemption rates each year. The overtime exemption rate required to meet the exemption for computer software employees has now risen from $55.58 per hour to $56.97 per hour, increasing the monthly salary exemption from $9,646.96 to $9,888.13, and the annual salary exemption from $115,763.35 to $118,657.43. Similarly, the minimum hourly rate required to meet the exemption for licensed physicians and surgeons will be increased from $101.22 to $103.75.
SB 988 – Freelance Worker Protection Act
The Freelance Worker Protection Act, enacted by SB 988, establishes minimum requirements for contracts between employers, defined as “hiring parties” for purposes of the Act, and bona fide independent contractors, defined as “freelance workers.” The Act will apply to contracts entered into or renewed on or after Jan. 1, 2025.
The Act provides that a “freelance worker” is a person or organization consisting of no more than one individual that is “hired or retained as a bona fide independent contractor by a hiring party to provide professional services in exchange for an amount equal to or greater than two hundred and fifty dollars ($250).” The $250 minimum may be satisfied by a payment through a single contract or by aggregating all contracts between the same two parties within the last 120 days.
A “hiring party” is defined as “a person or organization in the State of California that retains a freelance worker to provide professional services.” This definition excludes federal, state, and foreign governments, as well as individuals hiring services for their personal benefit, that of their family members, or their homestead.
The Act requires that contracts between hiring parties and freelance workers be in writing and signed by the hiring party. The hiring party must retain a copy of the contract for a minimum of four years. The contract must include:
- the names and addresses of both parties,
- an itemized list of all services to be provided by the freelance worker, including the value of those services and the rate and method of compensation,
- the payment date or the mechanism for determining that date, and
- the deadline for the freelance worker to submit a list of services rendered to the hiring party to ensure timely payment.
The Act mandates timely payment for freelance workers, requiring that they be paid on or before the due date specified in their contract. If no date is specified, payment must be made no later than 30 days after the freelance worker completes their services.
Waivers of any of the above requirements will be deemed contrary to public policy and unenforceable, and although written contracts are required, freelance workers may still enforce oral contracts in methods available under existing contract law. Hiring parties are also expressly prohibited from discriminating or retaliating against freelance workers who seek to be covered by or enforce their rights under the Act.
Hiring parties face substantial penalties for violations of the Act. Prevailing freelance workers are entitled to actual damages, reasonable attorney’s fees and costs, injunctive relief, and any other remedies a court deems appropriate. If a freelance worker requested a written contract prior to starting work and the hiring entity refused, the worker is entitled to an additional $1,000. Further, if the hiring entity fails to pay the freelance worker the agreed-upon compensation within the required timeframe, the worker can recover up to twice the amount that was unpaid when payment was due. In cases where the hiring entity refused to provide a written contract, the amount unpaid will be determined by the rate the freelance worker reasonably understood to apply to the work.
SB 1100 – Prohibited Employment Advertising Regarding Driver’s Licenses
SB 1100 amends the Fair Employment and Housing Act (FEHA) to prohibit employers from stating in job postings, advertisements, applications, or any other materials that an applicant must have a driver’s license unless both of the following conditions are met:
- the employer reasonably expects that driving will be a necessary function of the position, and
- the employer reasonably believes that using an alternative form of transportation would not be comparable in terms of travel time or cost. Alternative forms of transportation include, but are not limited to, ride-hailing services, taxis, carpooling, bicycling, and walking.
AB 2299 – Model List of Whistleblower Protections and Responsibilities
Under current law, employers must prominently display a list of whistleblower rights and responsibilities under California whistleblower laws. Assembly Bill 2299 requires the Labor Commissioner to create a model list of employees’ rights and responsibilities under whistleblower laws. AB 2299 further provides that employers who post the Labor Commissioner’s model list will be considered in compliance with the existing requirement to prominently display employees’ rights and responsibilities regarding whistleblower laws. In December 2024, the official website of the Labor Commissioner posted a link to a pdf document providing the model list that employers can easily access to download and display in the workplace to ensure compliance with existing law.
AB 2123 –Paid Family Leave and Unused Vacation Time (State Disability Insurance)
Within the state disability insurance program, the program commonly known as the Paid Family Leave Program (PFL) is a state-run initiative that provides benefits to individuals taking time off to care for seriously ill family members, to bond with a newborn child, and to assist military family members called to active duty. Under current law, employers can require employees to use up to two weeks of accrued, unused vacation before receiving PFL benefits. However, for periods of disability commencing on or after Jan. 1, 2025, AB 2123 prevents employers from requiring employees to use accrued but unused vacation as a condition for initially receiving these benefits.
SB 1340 – Local Enforcement of Employment Discrimination Laws
SB 1340 was enacted to empower cities, counties, and other political subdivisions of the State to enforce local laws prohibiting discrimination in employment. Under current law, enforcement of FEHA and the Unruh Civil Rights Act is limited to the Civil Rights Department. This law amends Government Code section 12993 to clarify that cities, counties, or other political subdivisions of the State are permitted to enforce discrimination complaints under the acts, provided that the enforcement meets the following conditions:
- the local enforcement involves an employment complaint filed with the Department,
- the local enforcement occurs after the Department has issued a right-to-sue notice,
- the local enforcement begins before the time to file a civil action specified in the right-to-sue notice expires, and
- the local enforcement is based on a local law that is at least as protective as the state law.
SB 399 – California Worker Freedom From Employer Intimidation Act
SB 399 enacts the California Worker Freedom From Employer Intimidation Act. This law prohibits employers from discharging, discriminating against, retaliating against, or taking any other adverse action — or threatening to take such action — against employees who decline to attend or participate in employer-sponsored meetings regarding religious or political matters. Meetings held for the purpose of communicating the employer’s beliefs regarding religious or political matters are commonly referred to as “captive audience meetings.” Employees who decline to attend or participate during working hours must be paid while the meeting is held, and employers are subject to $500 penalties per employee for each violation. Employees may also seek any other applicable legal remedies for a violation of the Act, including punitive damages.
The Act does not apply to religious corporations, political organizations, educational institutions requiring a student or instructor to attend lectures on political or religious matters as part of the course work, and certain nonprofits. The Act also does not apply to an employer requiring employees to undergo training to comply with the employer’s legal obligations, including civil rights and occupational safety and health laws.
AB 3234 – New Requirements for Social Compliance Audits
AB 3234 was enacted to enhance transparency in the regulations governing child labor practices. The bill requires that employers who voluntarily conduct social compliance audits post a “clear and conspicuous” link on its website to the report that details the findings of the compliance audit with child labor law.
A “social compliance audit” is defined as a “voluntary, nongovernmental inspection or assessment of an employer’s operations or practices to evaluate whether the operations or practices are in compliance with state and federal labor laws, including, but not limited to, wage and hour and health and safety regulations, including those regarding child labor.” A posted report must contain certain details such as when the audit was completed, the findings of the audit, the employer’s policies and procedures regarding child workers, and other specified requirements.
AB 1815 – Discrimination Claims: Protective Hairstyles and Revised Definition of Race
In 2019, the Legislature enacted the CROWN Act, which protects individuals from discrimination in employment on the basis of hair texture or hairstyle. Additionally, existing law under FEHA defines “race” as “inclusive of traits historically associated with race, including, but not limited to, hair texture and protective hairstyles.” Further, FEHA states that “‘protective hairstyles’ includes, but is not limited to, such hairstyles as braids, locs, and twists.”
AB 1815 amends the language of FEHA to remove the term “historically” from the definition of “race.” AB 1815 also amends the Unruh Civil Rights Act to include the revised FEHA definition of “race” and the FEHA definition of “protective hairstyles.”
SB 1137 – Discrimination Claims: Combination of Protected Characteristics
SB 1137 revises existing law to prohibit discrimination not only based on a single protected characteristic but also discrimination based on a combination of two or more protected characteristics. SB 1137 further recognizes the concept of “intersectionality,” which refers to how different identities intersect and can result in a unique form of discrimination. The California Legislature describes intersectionality as “an analytical framework that explains how various forms of inequality interact, exacerbate one another, and can lead to intensified prejudice and harm.”
SB 1137 amends the Unruh Civil Rights Act, Civil Code section 51, the California Fair Employment and Housing Act at Government Code sections 12920 and 12926(o), and certain provisions of the Education Code to strengthen protections against discrimination by explicitly prohibiting discrimination based on a combination of characteristics. These amendments reflect principles already established in federal law.
AB 2499 & SB 1105 – Paid Leave for Crime Victims and Agricultural Employees
Please see our recent article regarding the important changes to California law regarding paid leave for employees enacted through AB 2499 & SB 1105 here: California Broadens Paid Sick Leave: Protections for Crime Victims and Agricultural Workers Amid Emergencies
AB 2049 – Motions for Summary Judgment: New Filing Deadlines and Limitations
For employment disputes that enter litigation, it’s important to know changes to court deadlines. Under current law, a motion for summary judgment or summary adjudication must be filed and served at least 75 days before the hearing on the motion, the opposition must be filed and served at least 14 days prior to the hearing, and any reply to the opposition must be filed and served at least five days before the hearing. AB 2049 extends these deadlines as follows:
- A party filing a motion for summary judgment or summary adjudication must file and serve the motion at least 81 days before the hearing.
- A party opposing the motion must file and serve their opposition at least 20 days before the hearing.
- A party filing a reply to the opposition must file and serve the reply at least 11 days before the hearing.
AB 2049 also introduces two new substantive limitations on filing motions for summary judgment:
- A party may not file more than one motion for summary judgment against an adverse party without permission from the court. However, this limitation does not apply to motions for summary adjudication.
- While previously supported by case law, the prohibitions against raising any new evidentiary matter, additional material facts, or separate statement submitted with the reply which were not presented in the moving papers or opposing papers are now codified by statute.
California’s constantly evolving employment laws can be complex, and compliance is critical to avoiding costly penalties and legal disputes. Employers should carefully review these updates and assess their policies and practices to ensure alignment with the new requirements.
If you have any questions or concerns about how these laws affect your business or need assistance with implementation, please reach out to one of DMW’s experienced and trusted employment law attorneys. A knowledgeable attorney can provide tailored advice, help you stay compliant, and protect your business from potential risks as you adapt to the new legal landscape.
DMW Associate Jonah Mekebri wrote this article.