In 2022, Governor Newsom signed 997 new bills into law, including several key bills which are set to have a substantial effect on California's employment landscape.As such, we would like to provide readers with a year-end summary of the most important changes to employment law that employers will face heading into 2023.  

• SB 3 - Minimum Wage Increase:

One of the biggest changes employers will encounter in 2023 is an increase in California's minimum wage to $15.50 an hour. With this increase, the minimum annual salary that California employees must earn to meet part of the overtime exemption test will also rise to $64,480 a year.

• SB 1162 – Pay Data Reporting and Transparency

With SB 1162, all private employers with 100 or more employees will be required to publish a pay data report that includes the number of employees by race, ethnicity, and sex in specified job categories and will be required to submit this pay data report to the California Civil Rights Department by the second Wednesday of May each year, beginning on May 10th, 2023. Additionally, employers with 15 or more employees will be required to include their pay scales for positions in any job postings, including those by third parties that employers use to announce, post, or publish job postings.

• SB 1044 – Emergency Working Conditions

With SB 1044, employers will be barred from taking or threatening to take adverse action against employees who refuse to come into work or leave work due to emergency conditions. For purposes of enforcement, the bill defines “emergency conditions” as “conditions of disaster or extreme peril to the safety of persons or property at the workplace or worksite caused by natural forces or a criminal act” or “an order to evacuate a workplace, a worksite, a worker's home, or the school of a worker's child due to natural disaster or a criminal act.”

In the event of an emergency condition, employers will be barred from preventing employees from accessing their mobile devices or other communication devices to seek emergency assistance, assess the safety of the situation, or communicate with a person to verify their safety.

• AB 257 – Fast Food Council

In a major change to California's fast-food industry, AB 257 will establish a 10-person “Fast Food Council” with the power to set standards for fast food workers' minimum wage, health and safety conditions, workplace security, and protection from discrimination and harassment. The Council members will be appointed by the Governor himself, as well as the speaker of the assembly and the Senate Rules Committee and will be made up of fast-food workers and their advocates, franchisees, franchisors, and representatives from the Governor's Office of Business and Economic Development and the Department of Industrial Relations. While set to go into effect January 1, AB 257 may be delayed as it appears that enough signatures have been gathered to have the bill placed as a measure on the November 2024 ballot.

• AB 1041 (Expansion of CFRA and HWHFA)

Under AB 1041, which updates the California Family Rights Act definition of “designated person”, employees will be permitted to take leave to care for any individual related by blood or whose association with an employee is the equivalent of a family relationship. AB 1041 will also update the Healthy Workplaces, Healthy Families Act by permitting employees to receive paid sick leave law to take care of any “designated person,” which the law defines as any individual identified by an employee at the time a request for paid sick leave is made. Under both amended acts, employers will be allowed to limit an employee to just one designated person per 12-month period.

• SB 523 (Contraceptives Equity Act):

Finally with SB 523, employers will be prohibited from discriminating against job applicants or hired employees based on reproductive health decision-making i.e., “a decision to use or access a particular drug, device, product, or medical service for reproductive health.” Employers will also be barred from requiring applicants or employees to disclose information relating to their reproductive health decision-making.

We highly recommend that all employers seek competent legal counsel to ensure that all employment practices satisfy the new requirements coming to California in 2023.