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By: Charlotte Hodde and Bradley Doucette

Seyfarth Synopsis:  As Californians prepare to set their clocks back an hour, California’s Civil Rights Council, within the state’s Civil Rights Department (CRD), is considering a reset of its own. In its October 16, 2026 Notice of Proposed Rulemaking, the Council proposed significant substantive changes to California’s pregnancy leave and accommodation protections. Although Californians will soon gain an hour, employers may have less time to respond to certain accommodation requests, and less room to rely on familiar documentation and leave practices. Comments to the State of California are due December 8, 2026.

While our clocks will “fall back” in one week, California may soon “spring forward” workplace accommodation and leave protections for pregnant workers. On October 16, 2026, the Civil Rights Council, within the California Civil Rights Department (CRD), published a Notice of Proposed Rulemaking, proposing several modifications to the Fair Employment and Housing Act’s (FEHA) pregnancy-related protections. According to the Council, FEHA’s rules “should be at least as protective as those implementing the PWFA”—the Federal Pregnant Workers Fairness Act, which went into effect in June 2024. The proposed changes would more closely sync California law with the federal PWFA, and in some respects, move California’s protections further ahead. Don’t lose sleep over these developments—check out this webinar for a refresher on the PWFA framework, and continue reading for a preview of what may be on the horizon for California’s proposed FEHA regulation amendments.

Setting the Clock: Broadening the Pregnancy Definitions to Sync with the PWFA

As the season turns, so too may the definition of “pregnancy” and related terms, which the Council proposes expanding to align with the PWFA’s more expansive definition of “pregnancy, childbirth, or a related medical condition.” Like the PWFA, the proposed definitions would encompass past, current, and even “potential or intended” pregnancy, including miscarriage, fertility treatment, and contraception. In other words, the proposal would turn back the starting point for pregnancy protections to encompass circumstances before an employee is pregnant.

The definition further clarifies medical conditions that may relate to pregnancy, including dehydration,  postpartum depression, sciatica, migraines, and varicose veins, among others. As the Council explains, the inclusion of these common conditions confirms that workers may be entitled to pregnancy disability leave and accommodations “even where their conditions are typical of almost all pregnancies, not just those that are high-risk.” Notably, the list is non-exhaustive, so employers should avoid treating it as a checklist when evaluating potential leave or accommodation requests.

Realigning the Reasonable Accommodation and Interactive Process Rules

As the days grow shorter, the list of accommodations grows longer. The draft amendments also expand California’s “reasonable accommodation” definition to align with the PWFA. Newly listed potential workplace accommodations include:

  • Telework, Remote Work, Change of Worksite:  Depending on the circumstances, an employer may need to consider whether changing where work is performed would reasonably accommodate the employee. This addition embraces one of the more commonly-requested accommodations for disability and pregnancy-related conditions.
  • Changes to How Work is Performed: The proposal also contemplates changes to the work environment or customary work practices to allow an employee to perform the essential functions of their job, or to work without increased pain or risk to their health or the pregnancy.
  • “Temporary” Suspension of Essential Functions: This is the most noteworthy new accommodation and a departure from the ADA and FEHA’s traditional accommodation framework. The change would alter the definition of “qualified employee” for accommodations related to pregnancy. Like the PWFA, the proposed regulations do not define “temporary,” which means an employer potentially could be required to relieve an employee of one or more (possibly even all) of their essential functions if they can perform their remaining job functions.

The proposed amendments also preserve existing accommodation options, including (1) temporary transfer; (2) light duty; (3) additional tools, furniture, or equipment; and (4) additional break time and access to a private lactation space.

Employers should not limit the interactive process to the listed accommodation options. The proposed regulations continue to require a case-by-case assessment of the reasonableness of an accommodation. To further the individualized nature of this process, the Council also proposes eliminating an “employer’s legally permissible past and current practices” from the accommodation assessment. If adopted, employers could not rely on past practices to evaluate the reasonableness of a requested accommodation.

The proposal also preserves omission of an “undue hardship” exception for accommodations related to pregnancy, which is a departure from the PWFA.

The 10-Day Response Window Loses Daylight

Under current California regulations, employers must respond to accommodation requests within 10 calendar days. The amendments would eliminate that fixed period and require employers to respond “as soon as practicable.”

The draft regulations further caution employers against “unnecessary delay” in providing a response. Although no fixed time frame is provided, the Council suggests that 10 calendar days may be excessive, particularly for common, easily-provided accommodations, or requests arising from an immediate need. The proposed amendments include four “simple” accommodations that should be provided without any delay: (1) water at a workstation; (2) extra restroom breaks; (3) sitting or standing as needed; and (4) extra breaks to eat and drink.

The Council also proposes eliminating retroactive approval of accommodation requests, i.e. approving an accommodation after the accommodation has started, reasoning that an accommodation cannot begin before it is approved. The proposed regulations retain retroactive approval for leave requests.

A New Season For Self-Confirmation Over Medical Certification

The proposed regulations would move California toward the PWFA standard for medical certification by allowing medical certification “only when it is reasonable under the circumstances.” This change could turn back employers’ ability to reflexively seek medical documentation, and move employee self-confirmation to the forefront.

For example, employers may be limited to the employee’s “self-confirmation” of a need for accommodation if (1) a request involves an obvious need or one of the “simple” accommodations discussed above, (2) the employer already has sufficient information, (3) the request involves nursing or pumping at work, or (4) the accommodation sought is available to employees not disabled by pregnancy or a related condition and those employees are not required to provide certification. The proposal defines self-confirmation as a simple statement from the employee confirming:

  • The employee needs a reasonable accommodation because of pregnancy, childbirth, or a related medical condition; and
  • A health care provider has advised the need for the accommodation.

The proposed regulations provide that employers could not require the statement to be in a specific format or use specific words.  

Under the proposal, seeking additional information after an employee has already provided “some” information could potentially constitute prohibited retaliation or interference.

Resetting the Leave Clock: 30-Day Leave Notice Is No Longer the Default

The proposed regulations would eliminate the 30-day advance notice requirement for foreseeable absences. Instead, employees would provide “reasonable advance notice” for foreseeable and unforeseeable leave requests. Employers would still be able to rely on the rebuttable presumption of 30 days in predictable cases, such as deliveries scheduled more than 30 days in advance. But the change expands the time when a shortened notice period will be appropriate, requiring employers to recalibrate the timelines built into their leave processes.     

CFRA May Get Time on the Pregnancy Disability Leave Clock

A longstanding distinction between FMLA and CFRA could change with these proposed regulations. Under current regulations, pregnancy disabilities qualify for FMLA leave, but are excluded from CFRA’s definition of a serious health condition. The draft amendments would keep the clock running for pregnancy disability. An otherwise eligible employee whose pregnancy disability continues after exhausting their four months of pregnancy disability leave could continue leave under CFRA, provided they are CFRA eligible. If the employee is also FMLA-eligible, FMLA and CFRA leave would run concurrently for this portion of leave. For employers accustomed to preserving CFRA leave until pregnancy disability ends, the amendment could materially change the leave timeline.

Bonding Leave Might Be Available in Smaller Increments

Bonding leave can currently be taken in two-week increments, with minor exceptions. The Council’s proposed modifications would remove this minimum duration, and allow employees to take CFRA bonding leave in smaller increments at any point within the one-year period following a child’s birth or placement with the employee in connection with adoption or foster care. This would give new parents more flexibility, while making scheduling harder for employers.

Mark Your Calendars For December 8, 2026: The Comment Clock Is Ticking

Although the Council’s stated intent was to “clarify existing law without imposing any new burdens,” employers who have built processes around 10-day response periods, routine documentation requests, and two-week bonding blocks may see it differently.

The Council will hold a public hearing on December 8, 2026, at 11:00 a.m. Interested persons can attend and offer statements or arguments regarding the proposed regulatory action virtually or in person in Los Angeles. Information on attending can be found here. Persons may also submit written comments to Council@calcivilrights.ca.gov no later than 5:00 p.m. that day.

Workplace Solutions: Time For A Seasonal Reset

These rules are still proposals, and while many of them track PWFA requirements that already apply to employers in California, the proposals could meaningfully reset aspects of California employers’ existing accommodation and leave practices for employees disabled by pregnancy or related conditions. When you set your clocks back on November 1, consider reviewing your pregnancy leave and accommodation processes too—this is one reset California employers won’t want to sleep through. Just as the changing season brings shorter days and a reset of the clocks, the end of the year is an opportunity for employers to take stock of which other workplace policies may need to be reset or revised. To help keep your compliance calendar on track, tune in to our October 29, 2026 webinar in which we’ll cover the employer law changes employers should have on their radar.

Contact your favorite Seyfarth lawyer for more information about the proposed regulations, and other employment law updates, and what they may mean for your workplace.

Edited by Catherine Feldman and Kristina Launey

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Seyfarth Synopsis: With Governor Newsom’s September 30 bill-signing deadline behind us, we review California’s new employment laws for 2027. The most spine-tingling among them are regulations of employers’ use of automated decision systems, changes to last year’s “stay or pay” law, and amendments impacting temporary restraining orders, bereavement leave, and workplace surveillance. But there are no ghosts or ghouls lurking here, only the information employers need to comply with these new requirements in time for their respective effective dates.

As Halloween decorations crept up around the state this September 30, Governor Newsom finished determining which bills will live on as laws effective January 1, 2027, and which were sent to an early grave. We saw far fewer employment bills in 2026 than in prior years, and thankfully, no wage and hour or PAGA bills lurking in the shadows to give employers a fright. The surviving new laws for which employers need to prepare include regulation of employers’ use of automated decision systems, temporary restraining orders, bereavement leave, and workplace surveillance. The Governor also dropped a little extra bit of candy into employers’ bags by approving new exceptions and a one-year compliance reprieve on 2025’s “stay or pay” law.

If you’re the type who counts trick or treaters coming to your door, you might appreciate these statistical treats courtesy of lobbyist Chris Micheli: of the 1,160 bills the Legislature sent to the Governor’s Desk, he signed 1,040 and vetoed 120. This is the highest percentage of bills reaching the Governor’s desk (63%) since 2002, when 65% of introduced bills were sent to the Governor. Over his 8 years in office, Governor Newsom acted on 7,803 bills, signing 6,752 (86.5%) and vetoing 1,051 (13.5%). Micheli compared this to his predecessors: (1) Governor Brown acted on 8,000 bills with a 13.7% veto rate; (2) Governor Schwarzenegger acted on approximately 7,400 bills with a 26.5% veto rate; (3) Governor Davis acted on approximately 6,200 bills with a 17.6% veto rate; and (4) Governor Wilson acted on nearly 11,300 bills with a 16.8% veto rate.

Read on for all the tricks and treats coming to California employers in the new year. All bills take effect January 1, 2027, unless stated otherwise.

AI Legislation

SB 947 – “No Robo Bosses Act” Automated Decision Systems (ADS)

SB 947, beginning July 1, 2027, prohibits employers from relying solely on an ADS when making employment-related decisions, and requires a human reviewer to conduct an independent investigation and compile corroborating information for disciplinary and termination decisions. An “ADS” includes any computational process derived from machine learning, statistical modeling, data analytics, or AI that issues simplified output, including scores, classifications, or recommendations, that is used to assist or replace human discretionary decision-making.

If the ADS output cannot be corroborated, or a human reviewer concludes it is inaccurate or misleading, the employer will be prohibited from relying on it. The bill also bars employers from using an ADS to:

  • Infer a worker’s protected status under FEHA, and
  • Predict and take adverse action against a worker for exercising their legal rights.

The new law requires employers to provide affected employees with post-use notice of an ADS, and a right to obtain a description of employee data primarily used by an ADS in a disciplinary or termination decision. The Labor Commissioner and public prosecutors have enforcement authority and employees may also bring private rights of action to recover in part civil penalties up to $500 per violation.

This bill adds Part 5.5.5 (commencing with Section 1520) to Division 2 of the Labor Code.

For a summary of prior AI-related California legislation, check out our prior blog posts here and here.

SB 951 – Cal/WARN: AI Technological Displacement Notice

SB 951 revises Cal/WARN to require a notice of a mass layoff, relocation, or termination caused in whole or in substantial part by an AI system (or other automated technology that replaces or automates employment positions). This notice must state at the top: “This notice is for a technology displacement,” and include: (1) the number, classification or occupation, and work location of layoffs substantially due to AI or other automated technology; (2) the job functions performed by those replaced workers that will be automated; and (3) the specific category or type of AI system or other automating technology resulting in the technological displacement. The Employment Development Department (EDD) must publish on its website a summary of the notices received and post a quarterly state-wide summary of reported technological displacements.

Notably, Cal/WARN’s 60-day advance notice period or coverage thresholds remain unchanged.

This bill amends Sections 1400.5 and 1401 of, and adds and repeals Section 1402.7 of, the Labor Code.

SB 574 – Attorneys’ Use of Generative AI

SB 574 imposes several limitations on attorneys’ AI use, and require attorneys to disclose their use of generative AI in court filings. The attorney conduct prohibited by this new law includes:

  • Entering confidential, personal identifying, and other nonpublic information into a generative AI system where access is not restricted to the attorney or authorized users with the obligation to keep the information confidential; and
  • Including in any paper filed in any court citations that have not been personally verified.

The new law requires attorneys to take reasonable steps to verify the accuracy of generative AI outputs and to correct any erroneous or hallucinated output. The new law also prohibits an arbitrator from (1) delegating any part of their decision-making process to a generative AI tool; and (2) relying on information from generative AI outside the record without making appropriate disclosures to the parties beforehand.

This bill amends Section 6173 of, and adds Section 6068.1 to, the Business and Professions Code, and amends Section 128.7 of, and adds Sections 180 and 1282.1 to the Code of Civil Procedure.

Anti-Discrimination and Harassment

AB 2563 – Sex Discrimination Definition Harmonization

AB 2563 creates a consistent definition of “sex discrimination” across California’s statutory codes, to align the definition in FEHA, the Unruh Act, the Education Code, and more.

This bill amends various sections of each impacted statute.

AB 1961 – TRO: Protecting A Group of Employees

AB 1961 permits an employer to seek a TRO on behalf of a reasonably identifiable group of employees based on their workplace or location—without having to identify an individual employee—if a credible threat of violence is generally directed at the employer’s workplace or at a group of employees.

This bill amends Section 527.8 of the Code of Civil Procedure.

AB 1928 — Postsecondary Education Sex Discrimination and Harassment Complaints: Support Person for Grievance Hearings

AB 1928 authorizes students at postsecondary educational institutions that receive state financial assistance and state student financial aid to have a support person and advisor of their choice with them at any stage of the grievance process related to a sexual harassment complaint arising under state law and Title IX.

This bill amends Section 66281.8 of, and adds Section 66281.10 to, the Education Code.

Vetoed: AB 1940 – Adding Menopause to FEHA Definition of “Sex”

AB 1940 would have added perimenopause, menopause, post-menopause or other related medical conditions to FEHA’s definition of sex, making those conditions protected categories under the FEHA, and required the Civil Rights Department to update its poster notifying women of their rights relating to perimenopause, menopause, and post-menopause. The Governor vetoed the bill citing significant cost and implementation concerns due to lack of clarity with some undefined terms. He subtly chastised the Legislature for sending him a bill that “does not strike the important, achievable balance between expanding access to this important treatment and the affordability of care” for the second year in a row. He instead directed the Health and Human Services Agency to identify additional policy changes or investments to address perimenopause and menopause evaluation and treatments for next year’s budget process.

This bill would have amended Section 51 of the Civil Code and Sections 12926 and 12950 of the Government Code.

AB 1803 – Mandating Anti-Hate Speech Training

AB 1803 will, beginning January 1, 2028, require that already-mandated sexual harassment training include, anti-hate speech training consisting of practical guidance on recognizing, reporting, and confronting workplace speech that vilifies, humiliates, or incites hatred against people based on FEHA protected characteristics.

This bill amends Section 12950.1 of the Government Code.

AB 2495 – Unlawful Immigration-Related Practices

AB 2495 expands Labor Code Section 1019 to include prohibiting retaliation against any person for exercising or attempting to exercise any right under federal, state, and local statutes and regulations applicable to employees. The new law also makes it unlawful for an employer, or any person, to engage in conduct, related to any person’s perceived immigration status, that would reasonably tend to dissuade them from engaging in conduct that the person has a legal right to engage in under any federal, state, or local statute or regulation that is applicable to employees, or to induce a person to engage in conduct where the person has a legal right to abstain. Additionally, if an employer or other person violates Section 1019, under this new law, they will be liable for civil penalties not exceeding $10,000 per employee or person for each violation. This penalty is in addition to other remedies already provided by Section 1019.

This bill amends Section 1019 of the Labor Code.

Leaves of Absence

SB 1149 – Bereavement Leave for a “Designated Person”

Continuing the Legislature’s “designated person” theme for the fourth year in a row, SB 1149 expands the persons for which an employee may take up to five days of unpaid (unless the employer’s policy provides for paid) bereavement leave to include the employee’s “designated person.” Employees can make this designation at the time they take leave and employers may limit an employee to one designated person per 12-month period.

This bill amends Section 12945.7 of the Government Code.

Wage and Hour

AB 1697 – Stay-or-Pay Contract Provisions

AB 1697, as we discussed in detail here, amends 2025’s trend-setting Anti-Trap law to make the law’s restrictions on contracts effective for stay-or-pay contracts entered into on or after January 1, 2027, rather than January 1, 2026. The bill has an urgency clause such that it went into effect on September 30, 2026—immediately upon signing. The new law establishes new exceptions to the stay-or-pay prohibition for:

  • Contracts entered into pursuant to a recruitment and retention program funded by a federal, state, or local government agency grant if the employee repayment obligations comply with the requirements of the grant and do not exceed the service obligations required by the grant;
  • Repayment obligations arising from advanced paid time off upon voluntary separation (if conditions are met); and
  • Contracts for the receipt of a discretionary or unearned monetary payment from the employer to induce the worker to be affiliated with the employer or to maintain a relationship with the employer between a securities broker-dealer, insurance producer, or investment adviser and its agents or representatives that are registered and licensed (if the contract satisfies certain conditions).

This bill amends Section 16608 of the Business and Professions Code, and Section 926 of the Labor Code.

SB 1237 – Pay Data Report Penalties

SB 1237 increases the penalty imposed on private employers for subsequent failures  to file the annual pay data report from $200 per employee to $1,000 per employee. The penalty for initial violations remains $100 per employee. It also requires the Civil Rights Department to annual publish the total number of pay data reports submitted. This new law follows 2025’s significant revisions to California’s annual pay data reporting obligations, which we discussed in detail here.

This bill amends Section 12999 of the Government Code.

SB 1316 — Labor Commissioner Liens and Hearing Evidence

SB 1316 authorizes the Labor Commissioner (LC) to renew a lien created on an employer’s real property to satisfy a wage order under Labor Code section 98.2 for an additional 10 years. The new law prohibits employers from using records in certain LC proceedings under Section 1174.1—such as payroll, time, and employment records required to be maintained at the place of employment or at a central location within the state—that were not provided timely to the LC pursuant to a written request, unless the employer proactively obtained a court order excusing production. These evidence prohibitions are applicable in administrative proceedings contesting a citation for retaliation or discrimination complaints. SB 1316 also extends these evidentiary preclusions to contractors and subcontractors in hearings under Labor Code Section 1742.

This bill amends Sections 98.2 and 1174.1 of, and adds Section 1742.05 to, the Labor Code.

AB 2646 – Agricultural Workers Minimum Wages

AB 2646 requires the minimum hourly wage for an approved agricultural employee to be $19.75 per hour, to be adjusted according to the cost of living adjustments for social security benefits each January starting in 2027.

This bill adds Section 1208 to the Labor Code.

Workplace Surveillance

AB 1331 & 1883 – Workplace Surveillance

AB 1331 prohibits an employer from using a “workplace surveillance tool” for monitoring or surveilling employees in a workplace bathroom and allowing employees to leave behind workplace surveillance tools when entering a workplace bathroom unless:

  • an employee is required to remain available during meal or rest periods;
  • the employer has a policy requiring possession of the device for identification or safety reasons; or
  • for access to locked or secure areas if the device (a) does not detect or record audio or video and (b) does not have physically embedded or attached artificial intelligence.

Workplace surveillance tools includes a “system, application, instrument, or device that collects or facilitates the collection of employee data, activities, communications, actions, biometrics, or behaviors by means other than direct observation by a person, including, but not limited to, video or audio surveillance, continuous incremental time-tracking tools, geolocation, electromagnetic tracking, photoelectronic tracking, a photo-optical system, or other means.” Smoke or carbon monoxide detectors and metal detectors are expressly excluded. 

AB 1883 prohibits certain employers (including government entities, universities, and labor contractors and their clients) from using a workplace surveillance tool that uses AI to collect neural data (such as gait analysis) or recognizes an individual’s emotional state.

Employers are exempted from the new law’s requirements if they are engaged in (1) the development of aircraft for use in the national airspace; or (2) the development of products or services for national security, military, space, or defense purposes where the use of a workplace surveillance tool is reasonably necessary to comply with a federal statute, a regulation, or binding federal contract.

Both new laws authorize the Labor Commissioner or a public prosecutor to enforce their provisions, and allow for civil actions seeking injunctive relief, punitive damages, and reasonable attorney’s fees and costs. Employers who violate the laws’ provisions are subject to civil penalties of up to $500 for each violation.

AB 1331 adds Part 5.8 (commencing with Section 1560) to Division 2 of the Labor Code, and AB 1883 adds Part 5.8 (commencing with Section 1580), to Division 2 of the Labor Code.

Restraining Orders

AB 2179 – Workplace Violence Restraining Orders

AB 2179 will, beginning on January 1, 2028, allow any party or witness to a petition for a restraining order to appear remotely at a hearing and will prohibit any fee for appearing remotely. Each county’s court will be required to develop rules and instructions for these remote appearances and post them on their websites. The new law also will, commencing on January 1, 2028, require courts to allow filings related to such protective orders to be submitted electronically, as specified.

The bill amends Section 527.8 of the Code of Civil Procedure and Section 6103.2 of the Government Code.

AB 1753 – Protective Orders: Firearms; Notice and Procedures

AB 1753 requires a TRO petitioner to provide prior notice to the respondent only if the court determines that requiring prior notice would not likely endanger the petitioner, proposed protected parties, or other persons. It also requires the applicant’s attorney to certify to the court under oath that providing notice to the party to be restrained in advance of filing the petition would likely endanger the safety of the petitioner or other persons, and require courts to permit a party or witness to appear remotely at a hearing for a workplace violence restraining order at no cost.

This bill amends Sections 527.6, 527.8, 527.85 of the Code of Civil Procedure.

Arbitration

AB 2155 Validity of Agreements to Arbitrate

AB 2155 makes arbitration agreements unenforceable under California law where the agreement would likewise be unenforceable under the Federal Arbitration Act, such as certain interstate commerce transportation worker agreements and claims relating to sexual harassment or sexual assault disputes.

The bill amends Section 1281 of the Code of Civil Procedure.

Civil Litigation

AB 1950 — Los Angeles Superior Court Civil Actions: Mandatory Mediation

AB 1950 authorizes County of Los Angeles Superior Court judges to order cases into mediation regardless of the amount in controversy. Those cases will be entitled to up to three hours of in-person or remote no-cost mediation services through the court’s program. These provisions will be in effect January 1, 2027, through January 1, 2032. The new law builds on the Court’s investment in ADR and the launch of its digital ADR platform in 2025, and is intended to assist with the Court’s 67% increase in civil filings since 2022.

This bill adds Section 1775.16 to the Code of Civil Procedure.

Workplace Solutions

Treat yourself and tune in to our October 5, 2026 webinar in which we’ll explore the final slate of new laws. And don’t be a stranger—check back in with us here at CalPeculiarities for spook-free updates on California policy and legislative updates.

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Seyfarth Synopsis: College football fans know that sometimes a game is won or lost after a late fourth-quarter replay review. Just when employers thought they knew the rules of California’s new “stay-or-pay” law under AB 692, the Legislature stepped in with a significant replay review of its own. On September 30, 2026, Governor Newsom signed AB 1697 into law, which delays AB 692’s applicability by a year, eliminates potential liability for 2026 “stay-or-pay” activity, clarifies existing and creates new exceptions. Read on for California’s revised “stay-or-pay” playbook.

As we previously discussed, last year, California enacted AB 692, one of the nation’s most aggressive restrictions on employee repayment obligations, training repayment agreements, retention incentives, and other arrangements that could require workers to repay money upon leaving employment. Mid-game, however, the Legislature reopened the playbook.

On September 30, 2026, Governor Newsom signed AB 1697, an urgency measure that immediately amends AB 692 in several significant respects.

For employers that spent the last year preparing for AB 692, California has effectively called a timeout. The game is still on, but the rules have changed.

First Quarter: The Legislature Delays Kickoff Until January 1, 2027

Most notably, AB 1697 delays enforcement of AB 692. The law now applies only to contracts entered into on or after January 1, 2027. The Legislature explained that the delay is intended to provide employers with additional time to ensure compliant restructured agreements, including employers operating under collective bargaining agreements.

AB 1697 goes even further and erases the first season from the standings. The statute provides that the prior version of the law is inoperative from January 1, 2026 through December 31, 2026. It also states that pending claims based on alleged violations occurring between January 1, 2026 and the effective date of AB 1697 are moot.

Second Quarter: A Targeted Carve-Out for the Financial Services Industry

In a surprise play, AB 1697 also creates a new exception for the financial services industry.

Specifically, the law permits certain discretionary or unearned monetary payments intended to induce a worker to affiliate with, or remain affiliated with, an employer. The exception only applies to agreements involving securities broker-dealers, investment advisers, insurance producers and their affiliates, together with qualifying registered or licensed agents and representatives.

The carve-out appears aimed at business models where recruiting packages, transition assistance, affiliation incentives, and similar arrangements have long been commonplace.

As with the financial incentives exception, however, the details matter. To qualify for the financial services industry exception the terms must be included in a separate agreement that provides attorney consultation rights, compensation structure, and limitations on interest accrual. Employers should carefully review existing arrangements before assuming they qualify.

Notably, this industry-specific exception may be particularly important for businesses that have spent the past year evaluating whether forgivable loans, recruiting packages, and affiliation incentives remain viable under California’s stay-or-pay restrictions.

Halftime Adjustment: California Changes Course on Financial Incentives

AB 1697 makes an important change to AB 692’s limited exception for certain financial incentives by removing the “at the outset of employment” requirement. Instead of focusing on when an incentive is paid, the amended statute focuses on how the arrangement is structured. To this end, AB 1697 includes broader exceptions for retention bonuses, recruitment incentives, and other common incentive-related payments that satisfy certain requirements, including:

  • The repayment obligation be contained in a separate agreement;
  • Employees receive notice of their right to consult counsel and at least five business days to do so;
  • Any repayment obligation be prorated;
  • Any retention period not exceed two years;
  • Employees have the option to defer receipt of the payment until the retention period is completed; and
  • Repayment generally be triggered only by voluntary separation or separation for misconduct.

This shift more directly aligns with the reality of such financial incentives, which are not universally prohibited “quit fees” and are commonly offered not only at the outset of employment but also mid-employment.

For employers seeking to retain key talent in a competitive labor market, this exception may prove to be one of the most consequential amendments in the bill.

Third Quarter: The Legislature Calls a New Play for Repayment of Advanced PTO

Another area of confusion impacting AB 692 compliance efforts was whether it applied to agreements for repayment of advance paid time off to an employee. The Legislature cleared this up with the addition of a targeted exception that allows for enforcement of a repayment obligation arising from an employee’s voluntary separation if (1) the arrangement is disclosed separately from the employment contract, (2) arises from the employee’s request for advanced PTO, (3) is limited to no more than 40 hours of PTO, and (4) does not accrue interest.

Fourth Quarter: Tuition Agreements Stay in the Game with No Changes

AB 1697 preserves some of AB 692’s exceptions, including repayment of tuition associated with a transferable credential. As before, the arrangement must be included in a standalone agreement, the credential must be for a “degree,” cannot be required as a condition of employment, repayment must be prorated and limited to the employer’s actual costs, and repayment generally cannot be required if the worker is terminated other than for misconduct.

The bill also retains existing exceptions for government-sponsored loan repayment and loan forgiveness programs, government-funded recruitment and retention programs, apprenticeship programs approved by the Division of Apprenticeship Standards, and contracts related to the lease, financing or purchase of residential property.

Questions Remain After The Final Whistle

AB 1697 is far more than a technical cleanup bill, but it still leaves several important questions unanswered. For example, the statute’s definition of “worker” continues to create uncertainty. Earlier versions of AB 692 expressly referenced independent contractors, but that language was removed before enactment. Yet the statute still defines a “worker” broadly enough to include individuals participating in a “work relationship,” which may continue to generate questions regarding the law’s application outside of traditional employment relationships, including principals in a business.

Similarly, California’s definition of a “transferable credential” remains unusually narrow. Unlike some other states that have enacted restrictions on training repayment or stay-or-pay arrangements, AB 692’s exception is limited to degrees offered by accredited institutions authorized to operate in California. As a result, uncertainty may remain regarding the treatment of many employer-provided training programs, certifications, licenses, and other credentialing arrangements that do not fit neatly within the statutory definition.

Workplace Solutions: What Employers Should Do Before January 1, 2027

While California is not alone in attempting to address the perceived impact of stay-or-pay agreements on employee mobility, its restrictions remain among the most expansive in the country. After AB 1697, employers at least have a revised playbook, more time on the clock, and greater guidance regarding which incentive arrangements may remain in bounds when the law takes effect on January 1, 2027.

In reality, although the law states it was intended to provide employers with an additional year to address their agreements before the law takes effect, employers will only have a few months left in 2026. Employers should use the extra time strategically to:

  • Inventory existing sign-on bonus, retention bonus, training repayment, tuition reimbursement, forgivable loan, and other repayment arrangements.
  • Identify agreements that may qualify for one of the newly expanded statutory exceptions.
  • Update any prior changes to remove the “at the outset of employment” restriction.
  • Reassess recruitment, retention, and affiliation strategies for 2027 and beyond.

The authors or your favorite Seyfarth lawyer are here to help navigate compliance within AB 1697’s revised statutory framework.

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Seyfarth Synopsis: The California Occupational Safety and Health Standards Board has approved a much-needed dose of revisions to California’s workplace first aid requirements for construction and general industries. For general industry employers, the most notable change removes a longstanding pain point that first aid kit contents be approved by a consulting physician. Instead, employers may now comply by providing a first aid kit meeting ANSI/ISEA Z308.1-2021 Class A requirements. The amendments should simplify compliance, but employers should not treat the revised rule as a quick fix. A key obligation remains: employers must  evaluate workplace-specific hazards and provide additional first aid supplies wherever reasonably necessary. In other words, a standard kit may stop the bleeding, but it won’t always cover every wound. Assuming approval by the Office of Administrative Law, the amendments are expected to take effect on January 1, 2027.

Background

The California Occupational Safety and Health Standards Board has approved long-awaited revisions to California’s workplace first aid requirements. For employers the changes are just what the doctor ordered. The amendments to 8 CCR sections 1512 (construction) and 3400 (general industry) modernize California’s approach to workplace first aid kits and provide employers with a more flexible path to compliance. The rulemaking now proceeds to the Office of Administrative Law (OAL) for review. If approved, the amendments are expected to take effect on January 1, 2027.

Ditching the Doctor’s Note For General Industry Employers

The most significant practical change affects general industry employers. Historically, 8 CCR 3400 required first aid materials to be approved by a consulting physician. Many employers nursed citations because of missing approval letters rather than because their first aid kits were inadequate. The revised regulation offers a simpler remedy. Employers may now either:

  • Provide a first aid kit that complies with ANSI/ISEA Z308.1-2021 Class A workplace first aid kit requirements; or
  • Have the contents determined by an employer-authorized licensed physician or other licensed health care professional (PLHCP).

It’s About More Than What’s In The Kit

A clean bill of health for employers takes more than a well-stocked first aid kit. The amendments also require employers to:

  • Evaluate the number of first aid kits needed based on employee locations and workplace hazards;
  • Ensure first aid kits are readily available;
  • Communicate first aid kit locations to employees;
  • Clearly identify kit locations where practicable; and
  • Inspect and replenish first aid supplies as necessary.

Employers should treat the amendments as an opportunity for a check-up of their entire first aid program—not just a change to first aid kit contents.

Hazard Warning: A Standard Kit Isn’t Always Enough

The amended standards require employers to provide additional specialized first aid items when a hazard assessment identifies workplace hazards that are unique, reasonably anticipated, and potentially serious. For example, an ANSI-compliant Class A kit may satisfy the baseline requirements, but it may not be sufficient for every workplace.

The Board specifically rejected proposals to require items such as naloxone or epinephrine in all workplaces, instead concluding that such needs are best diagnosed through the hazard assessment process. Employers should examine whether their operations involve chemical, electrical, thermal, remote-work, or other unique hazards that warrant additional supplies.

A Prescription For Workplace Solutions

Assuming OAL approval, employers should give their first aid programs a check-up before the anticipated January 1, 2027 effective date.

Key questions include:

  • Do existing first aid kits satisfy ANSI/ISEA Z308.1-2021 Class A requirements?
  • Are first aid kit locations adequately communicated and identified?
  • Is there a process for inspecting and replenishing supplies?
  • Has the employer evaluated whether workplace-specific hazards require additional first aid items?

Feeling any symptoms of uncertainty about the new requirements? Your favorite Seyfarth attorney, or any member of the Workplace Safety and Environment Team are here to assist with evaluating your first aid program before the anticipated January 1, 2027 effective date.

Edited By: Catherine Feldman

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Seyfarth Synopsis: The California Legislature concluded the second year of its 2024-2026 session on September 1, 2026, and sent the last of its approved bills to Governor Newsom for consideration. The Governor has until September 30 to approve or veto fewer bills than we’ve seen in years, but those that remain will still impact employers in California.

On September 1, 2026, the California Legislature sent the last of its approved bills to Governor Newsom, who has until September 30 to decide which employment bills will become laws effective January 1, 2027 (or earlier as urgency legislation). Quite a bit lighter than in past years, and noticeably free of wage hour or PAGA legislation, the most significant bills for his consideration impacting employers address regulation of employers’ use of automated decision systems, changes to last year’s “stay or pay” law, temporary restraining orders, bereavement leave, and workplace surveillance.

Bills Already Signed Into Law

AB 2155 Validity of Agreements to Arbitrate

AB 2155, approved by the Governor June 30, 2026, makes arbitration agreements unenforceable under California law where the agreement would likewise be unenforceable under the Federal Arbitration Act, such as certain interstate commerce transportation worker agreements and claims relating to sexual harassment or sexual assault disputes.

The bill amended Section 1281 of the Code of Civil Procedure.

AB 1950 — Los Angeles Superior Court Civil actions: Mandatory Mediation

AB 1950, signed into law August 27, 2026, authorizes County of Los Angeles Superior Court judges to order cases into mediation regardless of the amount in controversy. Those cases will be entitled to up to three hours of in-person or remote no-cost mediation services through the court’s program. These provisions will be in effect January 1, 2027, through January 1, 2032. The legislation builds on the Court’s investment in alternative dispute resolution and the launch of its digital ADR platform in 2025, and is intended to assist with the Court’s 67% increase in civil filings since 2022.

This bill added Section 1775.16 to the Code of Civil Procedure.

SB 1316 — Labor Commissioner Liens and Hearing Evidence

SB 1316, signed into law August 27, 2026, authorizes the Labor Commissioner (LC) to renew a lien created on an employer’s real property to satisfy a wage order under Labor Code section 98.2 for an additional 10 years. The bill also prohibits employers from using   records in certain LC proceedings under Section 1174.1—such as payroll, time, and employment records required to be maintained at the place of employment or at a central location within the state—that were not provided timely to the LC pursuant to a written request, unless the employer proactively obtained a court order excusing production. These evidence prohibitions are applicable in administrative proceedings contesting a citation for retaliation or discrimination complaints. SB 1316 also extends these evidentiary preclusions to contractors and subcontractors in hearings under Labor Code Section 1742.

This bill amended Sections 98.2 and 1174.1 of, and added Section 1742.05 to, the Labor Code.

AB 1928 — Postsecondary education sex discrimination and harassment complaints: support person for grievance hearings.

AB 1928, signed into law on August 27, 2026, authorizes students at postsecondary educational institutions that receive state financial assistance and state student financial aid to have a support person and advisor of their choice with them at any stage of the grievance process related to a sexual harassment complaint arising under state law and Title IX.

This bill amended Section 66281.8 of, and adds Section 66281.10 to, the Education Code.

Bills On the Governor’s Desk

AI-Related Bills

SB 947 – “No Robo Bosses Act” Automated Decision Systems (ADS)

SB 947, beginning July 1, 2027, would prohibit employers from relying solely on an ADS when making employment-related decisions, and would require a human reviewer to conduct an independent investigation and compile corroborating information for disciplinary and termination decisions. If the ADS output cannot be corroborated, or a human reviewer concludes it is inaccurate or misleading, the employer would be prohibited from relying on it. The bill would also bar employers from using an ADS to (1) infer a worker’s protected status under FEHA, and (2) predict and take adverse action against a worker for exercising their legal rights. The bill would require post-use notice of ADS to affected employees, provide employees with a right to obtain a description of employee data primarily used by an ADS in a disciplinary or termination decision, and authorize enforcement through the Labor Commissioner, public prosecutors, and civil actions. “ADS” is defined as any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including a score, classification, or recommendation, that is used to assist or replace human discretionary decision-making.

This bill would add Part 5.5.5 (commencing with Section 1520) to Division 2 of the Labor Code. 

SB 947 reintroduces some objectives of the broader SB 7 (vetoed in 2025). In other recent AI-related legislation, AB 1018 (2025) (which did not pass) would have required employers to provide employees with disclosures regarding AI-driven decisions and to give employees a chance to appeal the decision. AB 2930 of 2024 also proposed regulating the use of ADS in employment practices, including pay, promotion, hiring, termination, and task allocation. At that time, we previewed an expectation of more action on this topic in years to come, as the Governor’s veto message on non-employment AI bill AB 1047 previewed. We similarly expect AI legislation in the employment space and beyond to continue.

SB 951 – Cal/WARN: AI technological displacement notice.

SB 951 would revise Cal/WARN to require a Cal/WARN notice of a mass layoff, relocation, or termination caused in whole or in substantial part by an AI system (or other automated technology replacing or automating employment positions). This notice would need to state at the top: “This notice is for a technology displacement,” and include: (A) the number, classification or occupation, and work location of layoffs substantially due to AI or other automated technology; (B) the job functions performed by those replaced workers that will be automated; and (C) The specific category or type of AI system or other automating technology resulting in the technological displacement.

The final version of the bill retains the 60-day advance notice period and Cal/WARN coverage thresholds. The bill would require the Employment Development Department (EDD) to publish a summary of the notices received on its website and to post a quarterly statewide summary of technological displacements reported.

This bill would amend Sections 1400.5 and 1401 of, and add and repeal Section 1402.7 of, the Labor Code.

SB 574 – Attorneys’ Use of Generative AI

SB 574 would impose several limitations on attorneys’ AI use, and require attorneys to disclose their use of generative AI in court filings. The attorney conduct the bill would prohibit includes: (1) entering confidential, personal identifying, and other nonpublic information into a generative AI system where access is not restricted to the attorney or authorized users with the obligation to keep the information confidential; and (2) including in any paper filed in any court citations that have not been personally verified. The bill also would require an attorney to take reasonable steps to verify the accuracy of generative AI outputs and to correct any erroneous or hallucinated output. In addition to attorney conduct, the bill would prohibit an arbitrator from (1) delegating any part of their decision-making process to a generative AI tool, and (2) relying on information from generative AI outside the record without making appropriate disclosures to the parties beforehand.

This bill would amend Section 6173 of, and add Section 6068.1 to, the Business and Professions Code, and amend Section 128.7 of, and add Sections 180 and 1282.1 to the Code of Civil Procedure.

Leaves of Absence & Anti-Discrimination

AB 1940 – Adding Menopause to FEHA Definition of “Sex”

AB 1940 would add perimenopause, menopause, post-menopause or other related medical conditions to FEHA’s definition of sex, making those condition a protected category under the FEHA. The bill would also require the Civil Rights Department (CRD), by July 1, 2027, to update the poster notifying women of their rights relating to perimenopause, menopause, and post-menopause.

This bill would amend Section 51 of the Civil Code and Sections 12926 and 12950 of the Government Code.

AB 2563 – Sex Discrimination Definition Harmonization

AB 2563 would create a consistent definition of “sex discrimination” across codes, to align the definition in FEHA, the Unruh Act, the Education Code, and more. The bill states it is declaratory of existing law, but would add menopause-related conditions to the definition of “sex” if AB 1940 is enacted and takes effect on or before January 1, 2027.

This bill would amend various sections of each impacted statute.

SB 1149 – Bereavement Leave for a “Designated Person”

Continuing the Legislature’s “designated person” theme for the fourth year in a row, SB 1149 would expand the persons for which an employee may take up to 5 days of unpaid (unless the employer’s policy provides for paid) bereavement leave to include the employee’s “designated person”. The designation would be made when the leave is taken. The bill would authorize an employer to limit an employee to one designated person per 12-month period.

This bill would amend Section 12945.7 of the Government Code.

AB 1803 – Mandating Anti-Hate Speech Training

AB 1803 would, beginning January 1, 2028, require that already-mandated sexual harassment training include, anti-hate speech training consisting of practical guidance on recognizing, reporting, and confronting workplace speech that vilifies, humiliates, or incites hatred against people based on FEHA protected characteristics.

This bill would amend Section 12950.1 of the Government Code.

AB 2495 – Unlawful Immigration-Related Practices

AB 2495 would expand Labor Code Section 1019 to include prohibiting retaliation against any person for exercising or attempting to exercise any right under federal, state, and local statutes and regulations applicable to employees. Also, AB 2495 would make it unlawful for an employer or any other person to engage in conduct, related to any person’s perceived immigration status, that would reasonably tend to dissuade anyone from engaging in conduct that the person has a legal right to engage in under any federal, state, or local statute or regulation (applicable to employees), or to induce a person to engage in conduct where the person has a legal right to abstain.  The bill would make an employer or other person who violates Section 1019 liable for a civil penalty not exceeding $10,000 per employee or person for each violation, to be awarded to the employee or person who suffered the violation. The $10,000 penalty is in addition to other remedies already provided by Labor Code Section 1019,

This bill would amend Section 1019 of the Labor Code.

Other Bills

AB 1697 – Stay-or-Pay Contract Provisions

AB 1697 would amend 2025’s trend-setting Anti-Trap law to make the bill’s restrictions on contracts effective for stay-or-pay contracts entered into on or after January 1, 2027, rather than January 1, 2026. The bill has an urgency clause such that it will go into effect immediately upon signing, but as it still sits on the Governor’s desk, employers have not received the immediate relief from the January 1, 2026 deadline for which they had hoped. The bill would also establish new exceptions to the stay-or-pay prohibition for (1) contracts entered into pursuant to a recruitment and retention program funded by a federal, state, or local government agency grant if the employee repayment obligations comply with the requirements of the grant and do not exceed the service obligations required by the grant; (2) repayment obligations arising from advanced paid time off upon voluntary separation (if conditions are met); and (3) contracts for the receipt of a discretionary or unearned monetary payment from the employer to induce the worker to be affiliated with the employer or to maintain a relationship with the employer between a securities broker-dealer, insurance producer, or investment adviser and its agents or representatives that are registered and licensed (if the contract satisfies certain conditions.)

This bill would amend Section 16608 of the Business and Professions Code, and amend Section 926 of the Labor Code.

AB 1331 & 1883 – Workplace Surveillance

AB 1331 would prohibit an employer from using a “workplace surveillance tool” for monitoring or surveilling employees in a workplace bathroom and allow employees to leave behind workplace surveillance tools when entering a workplace bathroom unless an employee is required to remain available during meal or rest periods, the employer has a policy requiring possession of the device for identification or safety reasons or for access to locked or secure areas if  the device (a) does not detect or record audio or video and (b) does not have physically embedded or attached artificial intelligence.

“Workplace surveillance tool” is defined as a “system, application, instrument, or device that collects or facilitates the collection of employee data, activities, communications, actions, biometrics, or behaviors by means other than direct observation by a person, including, but not limited to, video or audio surveillance, continuous incremental time-tracking tools, geolocation, electromagnetic tracking, photoelectronic tracking, a photo-optical system, or other means.” Smoke or carbon monoxide detectors and metal detectors are excluded.  

AB 1883 would prohibit certain employers, including governmental entities, universities, labor contractors and their clients, from using a workplace surveillance tool that uses AI to collect neural data (such as gait analysis) or recognize an individual’s emotional state. There are exceptions for employers engaged in (1) the development of aircraft for use in the national airspace; and (2) the development of products or services for national security, military, space, or defense purposes where the use of a workplace surveillance tool is reasonably necessary to comply with a federal statute, a regulation, or binding federal contract.

Both bills would authorize the Labor Commissioner or a public prosecutor to enforce their provisions, and civil actions seeking injunctive relief, punitive damages, and reasonable attorney’s fees and costs. In addition, employers who violate the bills’ provisions are subject to a civil penalty of up to $500 for each violation.

AB 1331 would add Part 5.8 (commencing with Section 1560) to Division 2 of the Labor Code, and AB 1883 would add Part 5.8 (commencing with Section 1580), to Division 2 of the Labor Code.

Restraining Order Bills

AB 2179 – Workplace Violence Restraining Orders

AB 2179 would, beginning on January 1, 2028, allow any party or witness to a petition for a restraining order to appear remotely at a hearing and would prohibit any fee for appearing remotely. The bill would require the court of each county to develop rules and instructions for such remote appearances and post them on its website. The bill would also, commencing on January 1, 2028, require courts to allow filings related to such protective orders to be submitted electronically, as specified. The bill would make conforming changes.

The bill would amend Section 527.8 of the Code of Civil Procedure and Section 6103.2 of the Government Code.

AB 1753 – Protective Orders: Firearms; Notice and Procedures

AB 1753 would require the petitioner for a TRO to provide prior notice to the respondent only if the court determine that requiring prior notice would not likely endanger the petitioner, proposed protected parties, or other persons. It would also require the applicant’s attorney to certify to the court under oath that providing notice to the party to be restrained in advance of filing the petition would likely endanger the safety of the petitioner or other persons, and require courts to permit a party or witness to appear remotely at a hearing for a workplace violence restraining order at no cost.

This bill would amend Sections 527.6, 527.8, 527.85 of the Code of Civil Procedure.

AB 1961 – TRO: Protecting A Group of Employees

AB 1961 would permit an employer to seek a such a TRO on behalf of a reasonably identifiable group of employees by their workplace or location – without having to identify an individual employee – if a credible threat of violence is generally directed at the employer’s workplace or at a group of employees.

This bill would amend Section 527.8 of the Code of Civil Procedure.

Workplace Solutions

We will continue to keep you apprised through the September 30, 2026 bill signing deadline. Stay tuned for our end of session blog and sign up for our October 5, 2026 webinar in which we’ll explore the final slate of new laws. Please check back in with us here at Cal Peculiarities for regular check-ins on California policy and legislative updates.

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Seyfarth Synopsis: On August 14, 2026, Cal/OSHA released a revised discussion draft of proposed changes to California’s heat illness prevention standards included in Section 3395 (Outdoor Heat Illness Prevention) and Section 3396 (Indoor Heat Illness Prevention). The proposal continues Cal/OSHA’s effort to implement AB 2243, which was signed into law in 2022, while making California’s indoor and outdoor heat standards more consistent in structure and terminology. Although many of the revisions are intended to harmonize the two standards, the draft also contains substantive changes that could significantly affect compliance obligations, including an expansion of outdoor high-heat procedures and new acclimatization requirements for newly-assigned and returning employees. Comments on the discussion draft are due September 21, 2026. Some like it hot—but Seyfarth is here to prepare employers for the rising temperatures. Keep reading for everything employers need to know about the August 2026 draft.

Background

It’s been a long, hot summer, or really summers, as Cal/OSHA continues to modify its proposed revisions to California’s heat illness prevention regulations. As we previously discussed, in May 2025, Cal/OSHA released its first proposed revisions as part of its effort to implement AB 2243. Among other things, AB 2243 directed Cal/OSHA to consider revisions relating to heat illness prevention plans and acclimatization requirements. Although AB 2243 focused primarily on the outdoor heat standard, Cal/OSHA elected to review both the outdoor and indoor regulations. Following stakeholder comments and advisory committee discussions, Cal/OSHA released a substantially revised draft on August 14, 2026.

It’s Getting Hot Out There: Expanded Outdoor High-Heat Procedures

Perhaps the most scorching proposal in the August 2026 draft is the elimination of an existing limitation on Section 3395’s outdoor high-heat procedures, which currently only apply to employers in specified industries, including agriculture, construction, landscaping, oil and gas extraction, and certain transportation operations. The August 2026 proposal extends high-heat requirements to a broad range of outdoor employers whenever temperatures reach 95 degrees Fahrenheit. For employers previously not subject to California’s high-heat requirements, this change could have a significant practical impact.

Soak Up the Sun (Slowly): Expanded Acclimatization Requirements

The August 2026 proposal adds more well-defined acclimatization requirements. Under California’s current regulations, employers must closely observe newly assigned employees during specified periods of elevated heat exposure. The August 2026 draft retains and expands concepts first introduced in the May 2025 proposal by addressing both newly assigned employees and employees returning to work after an absence exceeding 14 days.

Under the proposal, employers would have two options when assigning unacclimatized employees to covered heat conditions. Employers could:

  • Implement enhanced protective measures and close observation procedures; or
  • Phase employees into heat exposure through prescribed exposure schedules.

California isn’t walking on the sun alone. The proposed changes mirror acclimatization provisions in Oregon’s heat illness rule as well as federal OSHA’s proposed heat illness rule.

Although the precise details may continue to evolve during the rulemaking process, the broader message from Cal/OSHA is clear: employers should anticipate greater scrutiny of acclimatization practices.

Clear Instructions Even During a Cruel Summer: Distribution of Heat Illness Prevention Plans

The August 2026 draft retains one of the most notable additions from the May 2025 proposal: affirmative requirements for distributing Heat Illness Prevention Plans (HIPPs).

Cal/OSHA wants every employee to have their own pocketful of sunshine—a HIPP within arm’s reach. Under the proposed language, employers would be required to distribute HIPPs to employees upon hire, during heat illness prevention training, and at least once annually. The proposal clarifies that employers would not be required to distribute the plan to the same employee more than twice each year and would permit electronic posting and distribution in certain circumstances.

Heating Up The Focus on Heat Illness Recognition

The August 2026 draft also continues Cal/OSHA’s effort to align definitions and terminology between the indoor and outdoor standards. Among other changes, the proposal includes rhabdomyolysis within the definition of heat illness, adds supplements and recreational drugs to the list of personal risk factors, and creates a more detailed and consistent description of heat illness signs and symptoms across both regulations. Although these revisions may not dramatically alter day-to-day compliance obligations, employers may ultimately need to update training materials, written programs, and educational resources if the August 2026 proposal moves forward substantially as drafted.

More Heat on the Horizon?

Just like a California summer, Cal/OSHA’s efforts aren’t cooling down anytime soon. Additional revisions may be made to the August 2026 proposal following the public comment period before Cal/OSHA initiates formal rulemaking under California’s Administrative Procedure Act. Interested stakeholders have until September 21, 2026 to submit comments.

Workplace Solutions

If adopted as-is, the August 2026 proposal would significantly expand employers’ existing heat-related obligations and create additional requirements. But don’t sweat it, the authors, your favorite Seyfarth attorney, or any member of the Workplace Safety and Environment Team are here to advise on the August 2026 draft and any future iterations.

Edited By: Catherine Feldman

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Seyfarth Synopsis: San Francisco just delivered a bundle of joy for new parents. The city reduced the employment tenure requirement under its Paid Parental Leave Ordinance from 180 days to 90 days, meaning eligible employees can start accessing employer-paid supplemental compensation benefits faster. Covered employers may want to start baby-proofing their policies now, ahead of phased-in compliance beginning January 1, 2027.

New parents in San Francisco have a reason to celebrate. On August 7, 2026, the mayor signed Ordinance 162-26, reducing the amount of time an employee must be on the job before qualifying for supplemental compensation benefits under the city’s Paid Parental Leave Ordinance (“SF PPLO”). Instead of waiting 180 days, employees can qualify after 90 days, bringing the ordinance in line with the city’s Paid Sick Leave Ordinance.

As a quick refresher, the SF PPLO requires employers with 20 or more employees (located anywhere) to “top up” an eligible employee’s California Paid Family Leave (“CA PFL”) benefits during new child bonding leave. In other words, the ordinance helps bridge the gap between what the State pays and an employee’s regular wages (up to a maximum cap), ensuring parents can focus less on finances and more on midnight feedings, diaper changes, and everything else that comes with welcoming a new family member. For 2026, the combined maximum weekly benefit amount from CA PFL benefits and employer-paid supplemental compensation is $2,522.

This amendment may be taking its first steps, but it is not changing much else. Employees still must work at least eight hours per week in San Francisco, perform at least 40% of their total weekly hours in the city, and otherwise qualify for CA PFL benefits for new child bonding leave. Like many toddler developments, the ordinance’s rollout will happen in stages rather than all at once. Employers with 100 or more employees must comply with the new 90-day eligibility threshold beginning January 1, 2027. Employers with 20 to 99 employees get a little more time to crawl before they walk, with compliance delayed until January 1, 2028. Employers with fewer than 20 employees remain exempt.

Workplace Solutions

Covered employers should not sleep on this update, even if new parents might not be getting much sleep themselves. Now is the time to revisit paid parental leave policies, update eligibility procedures, and monitor the SF PPLO webpage for updated guidance, posters, and forms. With the shortened waiting period, more employees will be eligible for benefits sooner. The authors or your favorite Seyfarth attorney are here to help make sure your policies are ready before this amendment leaves the crib and starts walking.

Also, please consider this your friendly reminder that handbook season is just around the corner. Whether your handbook needs a quick checkup or a full nursery-to-college makeover, Seyfarth’s Handbook Team is ready to help. Additionally, be on the lookout for details about Seyfarth’s Employee Handbook Update Webinar, where we’ll cover the latest developments. After all, when it comes to workplace policies, it’s always better to baby-proof now than scramble later!

Edited By: Catherine Feldman

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Seyfarth Synopsis:  For California employers, compliance with the Fair Chance Act (FCA) is not a game. In recent years, the California Civil Rights Department (CRD) has stepped up its investigations into complaints of FCA violations, and employers who don’t know the rules risk landing on a chute at every turn. Read on for our guide to navigating compliant background check practices and staying ahead of CRD enforcement.

The stakes are getting higher for California employers, who are seeing an increase in charges filed with the California Civil Rights Department (CRD) alleging violations of the California Fair Chance Act (FCA). This trend follows the CRD’s expanded regulations governing the use of criminal history in employment decisions, which became effective October 1, 2023, and reflects the agency’s heightened focus on FCA compliance in response to complaints filed by applicants and employees. Make no mistake, the CRD is not handing out Get Out of Jail Free cards.

Continue reading for an overview of the rules of the game, including the FCA legal framework, compliance areas the CRD typically examines when FCA charges are filed, and steps employers can take to prepare for and defend against these inquiries.

The Fair Chance Act Rulebook and the 2023 Regulatory Clarifications

The FCA generally requires California employers to:

  • Delay inquiry into or consideration of criminal history until after a conditional offer of employment—this includes ordering a criminal history background report;
  • Conduct an individualized, job‑related assessment before rejecting an applicant based on criminal history; and
  • Follow a two‑step notice process—a preliminary determination notice and a final determination notice—when taking action based on criminal history, regardless of how the information is obtained.

Regulatory amendments approved in 2023 clarified and expanded several key compliance obligations, including:

  • Expanding the definition of “applicant” to include certain current employees whose criminal history is reviewed due to changes in ownership, management, policies, or practices.
  • Reaffirming that employers may not include language in job advertisements or postings suggesting that individuals with criminal histories will not be considered.
  • Prohibiting employers from considering voluntarily disclosed criminal history prior to a conditional offer.
  • Clarifying that exemptions for legally mandated background checks apply only when the employer itself is required by law to conduct the check.
  • Requiring an initial individualized assessment before issuing a preliminary decision notice.
  • Expanding the categories of mitigating and rehabilitative evidence employers must consider, including trauma, disability‑related circumstances, and evidence of rehabilitation.

Time to Show Your Cards: What the CRD Looks for When a Charge Lands

When an applicant or employee files a charge alleging an FCA violation, the CRD’s investigation commonly extends beyond the narrow factual allegation to examine whether the employer complied with related FCA requirements across the board. In those investigations, the CRD typically focuses on the following areas:

1. Timing of Criminal‑History Inquiries

    The CRD routinely evaluates whether the employer rolled the dice before their turn and made any inquiry—directly or indirectly—into criminal history before making a conditional offer of employment, including:

    • Questions on employment applications
    • Interview conversations
    • Informal recruiter or hiring‑manager inquiries
    • Reliance on information volunteered too early in the application process

    1. Individualized Assessments

      The FCA does not require an employer to document its assessment. But, like a game of Clue, the CRD expects employers to show their winning strategy, and frequently requests documentation demonstrating that the employer:

      • Conducted the required initial individualized assessment before issuing a preliminary decision notice;
      • Considered each of the three statutory factors (i.e., the nature and gravity of the offense or conduct, the time that has passed since the offense, conduct, or completion of sentence, and the nature of the job sought or held)s; and
      • Connected the assessment to the actual duties and risks of the position.

      2. Notice and Response Procedures

        The CRD commonly examines whether:

        • The preliminary and final determination notices included all required materials, including the conviction‑history report and a statement that the individual has the right to file a complaint with the CRD;
        • The applicant or employee was afforded the full response period required by regulation; and
        • The employer refrained from making a final decision before the response period expired.

        3. Consideration of Mitigating or Rehabilitative Evidence

          When an applicant plays a new card—submitting mitigating or rehabilitative evidence—employers must factor it into their next move. Investigators often assess whether the employer:

          • Accepted and evaluated all mitigating or rehabilitative information submitted;
          • Conducted and documented a meaningful reassessment; and
          • Considered trauma‑related, disability‑related, or other mitigating factors where applicable.

          4. Consideration of Convictions Older than Seven Years

            Although California law permits employers to consider convictions older than seven years—outside the City and County of San Francisco and unincorporated areas of Los Angeles County—doing so can be a risky gambit as the CRD frequently asks whether the employer relied on older convictions.

            These inquiries reflect the CRD’s publicly stated position, including guidance posted on its website, prohibiting reliance on older criminal records. Employers should be prepared to articulate and document why consideration of an older conviction was job‑related and consistent with business necessity. The CRD will expect a heightened showing of job-relatedness.

            Your Next Move: Getting Ahead of the Charge

            The best defense is a good strategy. Employers facing an FCA charge—or seeking to reduce future exposure—should consider the following moves:

            1. Check the Board: Audit Criminal‑History Decision‑Making Processes

              Review job postings, applications, interview materials, recruiter scripts, conditional offer letters, and pre-adverse (preliminary determination) and adverse action (final determination) templates to ensure compliance with FCA requirements.

              2. Play the Right Cards: Strengthen Documentation of Individualized Assessments

                Use job‑specific assessment tools that address the three required factors and prompt decision‑makers to consider rehabilitation and mitigation evidence.

                3. No Skipped Turns: Ensure Compliance with Notice and Timing Requirements

                  Confirm that notices include required attachments and language, response deadlines are properly calculated, and reassessments are documented.

                  4. Teach the Rules: Train Recruiters, HR, and Hiring Managers

                    Training should focus on prohibited inquiries, handling volunteered information, and the required assessment and notice procedures.

                    The Endgame

                    An FCA charge can trigger searching inquiries into how an employer evaluates criminal history and implements required assessment and notice procedures. Don’t wait until the other player sits down at the board. Employers should ensure their practices are well‑documented, consistently applied, and aligned with the current regulatory framework — before the CRD takes a look first.

                    Workplace Solutions

                    Don’t roll the dice and hope to avoid scrutiny of your background check practices.If you need help navigating FCA compliance or an FCA CRD charge, the author of this article or your favorite Seyfarth lawyer are here to help employers develop a winning strategy.

                    Edited By: Catherine Feldman

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                    By: Heather Frisch, Christopher Bouquet, and Ashley Stein

                    Seyfarth Synopsis:  As of January 1, 2026, AB 889 bulldozed California’s Prevailing Wage law, which impacts public works employers—including public agencies, the contractors that work for them, and private owners and developers whose projects may be subject to public works requirements. The amended law reframes the calculation of fringe benefits for individuals who work on public works project and mandates annualization of such benefits, demolishes the practice of frontloading these benefits, and requires employers to maintain inspection-ready records of compliance.   

                    This year, AB 889 significantly revised California’s prevailing wage law, codified at Labor Code section 1773.1, to clarify the state’s prevailing wage regulations and streamline enforcement. Accordingly, as of January 1, 2026, California public works employers are required to annualize employees’ fringe benefits and maintain specific documentation demonstrating statutory compliance. These new obligations impact public agencies and their contractors, as well as private owners and developers whose projects may be subject to public works requirements. Continue reading for the blueprint of how to comply with the state’s amended prevailing wage law.

                    The Foundation: What is the Prevailing Wage?

                    “Prevailing wage” consists of the minimum per‑hour wage rate and the fringe benefit rate set by the Department of Industrial Relations (DIR) that must be paid to qualifying workers. Fringe benefits can be credited to employees only if they meet the requirements of section 1773.1, which includes contributions for health, pension, vacation, travel, and apprenticeship benefits.

                    The Workforce Roster: Who is Entitled to the Prevailing Wage?

                    All workers employed on public works projects must be paid the DIR-determined prevailing wage for the areas in which the project is located.

                    The Specs: What is a “Public Work” Under California Law?

                    The Labor Code broadly defines “public works” as including: construction, alteration, demolition, installation, or repair work done under contract and paid in whole or part from public funds. But, this definition can be misleading because the definition of “public funds” encompasses more than monetary payments.

                    “Public funds” include not only direct payments, but also fee waivers, land conveyed below market value, tax credits, and government loans or grants. Thus, even indirect forms of public support can trigger prevailing wage requirements. For example, developer-funded projects may qualify as public works if the project is tied to a public agency requirement (e.g., conditions of approval), and public-private partnerships may also qualify if the public agency retains control or provides financial assistance to the private company.

                    The Renovation: What Prevailing Wage Requirements Did AB 889 Change?

                    California’s amended law retrofitted the state’s prevailing wage practices as follows:

                    1. Mandatory Annualization of Fringe Benefits
                      Prior to January 1, 2026, the annualization calculation applied only to certain benefits. AB 889 mandated that all employer-paid fringe benefits credited toward the prevailing wage be computed on an annualized basis, using any consistent 12-month period, and account for employee’s public and private hours worked for the same employer. This is the same method adopted by the federal Department of Labor in enforcing the Davis-Bacon Act for crediting contributions made to fringe benefit plans.

                      Contractors may still choose whether or not to provide fringe benefits on prevailing wage jobs, and there are a few narrow exceptions to the amount of credit an employer may seek for fringe benefit payments that are included in the annualization requirement. However, the most critical exception has been retroactively revoked. Prior to January 1, 2026, the Director of the DIR was authorized to waive an annualization calculation method if it was deemed not to serve the purpose of the law. AB 889 not only removed this exemption, but immediately revoked any exemptions issued by the Director prior to the bill’s effective date.
                    2. Prohibition of Frontloading Fringe Benefits
                      Some employers previously allocated 100% of fringe benefit contributions to employees’ public project hours to maximize the fringe benefit credit. AB 889 eliminated this practice.
                    3. Recordkeeping and Document Production Requirements
                      Covered employers must maintain records of each worker’s total annual hours across public and private projects, benefit contribution schedules, and employee-specific annualized calculations. This documentation must be produced to the Division of Labor Standards Enforcement (DLSE) upon request. Failure to comply with such a request could lead to denial of the employer credit.

                    The Inspectors: How are the DIR and DLSE Enforcing the Prevailing Wage Law?

                    Recently, the DIR and DLSE have significantly expanded prevailing wage enforcement efforts. These agencies’ audits tend to focus on underpayment, employee misclassification, improper apprentice ratios, and inaccurate certified payroll. Penalties for noncompliant practices can include withholding contract funds and issuing civil wage and penalty assessments.

                    Contractors can also face other collateral consequences, including but not limited to California Contractors State Licensing Board disciplinary actions and/or debarment for willful violations or apprenticeship misuse or ratio violations

                    The Winning Blueprint: Start Building Compliance from the Ground Up!

                    The amended requirements under AB 889 create new job site hazards for public works employers in California relating to cash wage obligations, unbudgeted labor cost overruns, subcontractor non-compliance, and possible DLSE enforcement actions.

                    The following early compliance efforts can help protect employers from prevailing wage potholes:

                    • Conduct internal fringe-benefit audits;
                    • Update payroll systems to perform annualization automatically;
                    • Train payroll and field supervisors on proactive compliance;
                    • Ensure that the compliance clauses in applicable construction contracts and subcontracts are strong, and include flow-down obligations;
                    • Review public funding triggers, including fee waivers, land conveyances, or tax credits that might subject a project to public works requirements; and
                    • Restructure benefits to ensure that only bona fide contributions receive prevailing wage credit. 

                    Workplace Solutions

                    If you have questions about AB 889 compliance, or other construction industry employment issues, contact the authors of this article or your favorite Seyfarth lawyer for more information.

                    Edited by Catherine Feldman

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                    Seyfarth Synopsis: As the world turns its eyes to California this weekend for Super Bowl LX, employers doing business in California may not only think of warm weather and great football, but also the Labor Commissioner, aka the Division of Labor Standards Enforcement (DLSE), a division of the Department of Industrial Relations (DIR) tasked with investigating wage and hour practices, which can result in significant citations or settlements.

                    Employers doing business in California are well aware of the DLSE, aka the Labor Commissioner’s Office, which, among other things, investigates wage and hour practices and adjudicates employees’ wage theft claims. With Superbowl LX on our minds, we thought it appropriate to take a time out for a recap of the 2025 DLSE season’s expansive impact on employers.

                    DLSE Investigations and Enforcement

                    In 2025 alone, the Labor Commissioner’s Bureau of Field Enforcement (BOFE) threw a flag on the play and issued more than 3,600 notices to discontinue wage and hour violations, including the following settlements and citations:

                    • $1.2 million settlement against a Newport Beach luxury carwash for wage violations, with payments to the 23 affected workers ranging from $8,500 to $92,800.
                    • $2.3 million citation against Los Angeles-based developers at four construction sites for violations impacting 124 construction workers involving unpaid minimum wages and overtime compensation, wage statement violations, and paid sick leave.  
                    • $680,000 citation against a Los Angeles-based restaurant for failure to pay 48 employees all wages owed, meal and rest break violations, and wage statement violations.

                    The DLSE undertakes enforcement actions in response to worker complaints, and on its own accord strategically targeting certain industries that it assumes will have high rates of wage violations. The genesis of these high value citations can be Labor Commissioner investigations involving payroll and sick leave audits, employee interviews, and site visits. Their goal is to uncover systemic violations—such as unpaid overtime, missed meal and rest breaks, minimum wage or paid sick leave violations, or inaccurate wage statements.

                    If a business receives notice of a DLSE investigation, it is important to take the following steps:

                    • Immediately reach out to outside counsel experienced in these investigations to guide you through the process.
                    • Timely contact the assigned investigator to discuss the scope of the investigation;
                    • Ensure the requested materials have been preserved and are available for production;
                    • Have legal counsel review the relevant records before production to assess potential weaknesses; and
                    • Discuss with counsel a plan to correct any non-compliant practices before the conclusion of the DLSE’s investigation. 

                    The DLSE Calls For An Audible With Municipal Prosecutors

                    The Labor Commissioner has recruited some new players for the 2026 season, from municipal law enforcement authorities. On July 23, 2025, the DLSE announced that it was awarding grants under the Workers’ Rights Enforcement Grant Program, established in 2023, to 16 public prosecutors to pursue civil and criminal cases for wage theft, unlawful business practices, and Labor Code violations. The benefitting cities include Alameda, Fresno, Los Angeles, Oakland, Orange County, San Diego, and San Francisco, which received grant awards ranging from $600,000 to $750,000 per city.

                    With this additional funding, local agencies are expected to expand their investigations into potential Labor Code violations. These local investigations are often conducted in a similar manner to the DLSE’s investigations, and employers should follow similar steps when provided with a notice of investigation.

                    Individual DLSE Claims Can Take The Game Into Overtime

                    Large investigations aren’t the only way the DLSE blocks and tackles potential wage theft violations. The Labor Commissioner also receives thousands of individual wage claims each year. Employers can defend against or resolve these claims at an initial settlement conference and the subsequent formal hearing. These claims can also go into overtime, if either party appeals the DLSE’s decision to the California Superior Court, which will review the matter de novo, or to the Director of the DIR.

                    For a guide on how to avoid fumbling an individual claim, read all about the DLSE and the appeal process here. Like the game of football, this process has remained largely the same over the years, but with one recent notable exception. As the California Supreme Court held in the 2025 Iloff v. Cynthia LaPaille decision, an employee can raise additional claims during the appellate process.

                    Workplace Solutions

                    To limit exposure to any of the Labor Commissioner’s enforcement actions, employers should ensure good wage and hour hygiene so as to comply with California law. Here are some steps employers should consider taking to get game day ready:

                    • Review your wage and hour policies annually to ensure compliance with California’s ever-evolving requirements;
                    • Train your managers and HR team on compliance issues;
                    • Conduct internal audits to identify and correct problems early; and
                    • Respond promptly to employee complaints or questions about wage and hour practices.

                    Seyfarth is here to help employers navigate a path to California compliant practices and assist with defending against state and local agency enforcement efforts should they occur. Check out the CalPeculiarities Blog for other legal developments affecting California employers.

                    Edited By: Kristina Launey