California has adopted two new laws that employers should be mindful of. First, California is requiring employers to distribute a notice to employees by February 1, 2026, and annually thereafter describing their rights regarding unionization, immigration, interactions with law enforcement, and related topics. The Labor Commissioner has provided an appropriate notice and plans to re-issue it annually. Employers should make plans to distribute now, when hiring new employees, and annually moving forward.

Second, California has enacted stricter prohibitions on “stay or pay” provisions in employment contracts. Cal. Bus. & Prof. § 16608 prohibits employers from requiring workers to execute an agreement to pay a debt if the employment or work relationship ends, including agreements to authorize the collection of or end forbearance on a debt if the employment or work relationship ends, or to impose a penalty, fee, or cost on a worker if the employment or work relationship terminates.

Clients who utilize “stay or pay” tuition reimbursement programs or bonuses in California should contact David Robinson, Chris McNatt, Chip Andrewscavage, or Alaina Hawley for more information.