As 2026 approaches, California employers are preparing for one of the most comprehensive rounds of employment law changes in recent years. From wage adjustments to new reporting mandates, these updates touch nearly every aspect of HR and payroll management.
Below are some of the key highlights to review before the new year.
1. Minimum Wage and Exempt Thresholds
Starting January 1, 2026, the statewide minimum wage rises to $16.90 per hour, impacting not only hourly workers but also salary thresholds used to determine exempt classifications. Local rates may be even higher — for example, San Francisco’s will exceed $19/hour. Employers should update payroll systems and verify postings.
2. SB 294: Workplace “Know Your Rights” Act
Employers must now provide each employee with a written summary of rights annually, covering topics like workers’ compensation, immigration-related protections, and the right to organize. The law also introduces new emergency contact requirements, giving employees the option to specify who should be notified in case of arrest or detention during work hours.
3. Personnel File Requirements Expanded
SB 513 adds education and training records to personnel file access requirements. Employers should ensure training documentation is accurate, accessible, and consistently formatted.
4. WARN Act Updates for Layoffs and Closures
SB 617 expands employer obligations under the California WARN Act, requiring detailed layoff notices that include workforce development board information and CalFresh resources — plus a direct contact number and email for the employer.
5. Prohibition on “Stay or Pay” Clauses
AB 692 makes it unlawful to include repayment or penalty provisions tied to employment termination, except in specific, government-approved education or apprenticeship programs.
6. Pay Transparency and Data Reporting
SB 642 and SB 464 continue California’s push for transparency and equity. Job postings must now reflect realistic pay ranges, and large employers (100+) must file detailed pay data reports each May. Penalties for late submissions have increased, and job categories will expand to 23 by 2027.
7. Wage Enforcement and Worker Protections
SB 261 authorizes significant penalties for unpaid wage judgments, while SB 648 empowers the Labor Commissioner to investigate tip violations directly. Together, these measures strengthen enforcement for workers and accountability for employers.
8. Paid Family Leave Expansion
Looking further ahead, SB 590 broadens Paid Family Leave to include care for a designated person — an important step toward more inclusive workplace policies, effective July 1, 2028.
Action Steps for Employers
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Review and update your employee handbook.
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Audit payroll systems and HR files.
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Review job postings for pay scale accuracy.
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Prepare for new documentation and notice requirements.
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Schedule management training to ensure consistent compliance.
Staying ahead of these changes ensures a smoother start to 2026 — and demonstrates your organization’s commitment to fairness, transparency, and employee well-being.
Contact Bender Insurance Solutions today.
