Detailed Breakdown of Compliance and Labor Law Changes in California for 2025

Here’s a detailed breakdown of Compliance and Labor Law Changes in California for 2025, with a focus on what HR professionals, managers, and business owners need to know and do.

⚖️ Compliance & Labor Law Changes in California (2025)

California continues to lead the nation in progressive labor policies, and 2025 brings several key updates that impact classification, pay, leave, and more. Here’s what’s new and important:

🔹 1. Minimum Wage Increase (Statewide & Local)

• Statewide minimum wage (2025): $16.00/hour
• This also means the minimum salary to classify someone as exempt is now:

$66,560/year
(2x $16 × 40 hrs/week × 52 weeks)

⚠️ Local Minimum Wages:

Cities like San Francisco, Los Angeles, San Jose, and Berkeley have higher minimum wages, some exceeding $18/hour in 2025. Local rates affect:

• Hourly wages
• Exempt salary thresholds (for employees working within those cities)

🔹 2. Paid Sick Leave Expansion (SB 616)

• Effective January 1, 2024 but fully active through 2025
• Employees now get a minimum of 5 paid sick days (40 hours) per year (up from 3)
• Applies to full-time, part-time, and temporary workers
• Employers must:
  • Update policies and handbooks
  • Accrual: 1 hour for every 30 hours worked
  • Allow carryover, but may cap usage at 40 hours/year

🔹 3. Reproductive Loss Leave (SB 848)

• Effective January 1, 2024, in full effect for 2025
• Employers with 5+ employees must provide:
  • Up to 5 days of unpaid leave for a reproductive loss event (miscarriage, failed IVF, stillbirth, etc.)
• Applies to the employee or their partner
• Leave must be taken within 3 months of the event and may be nonconsecutive

📝 Employers must keep it confidential and cannot retaliate.

🔹 4. Retaliation & Whistleblower Protections Expanded

• Laws like SB 497 (Equal Pay & Anti-Retaliation Protections) increase penalties for employers who retaliate against employees who:
  • File wage claims
  • Discuss wages
  • Whistleblow on unsafe practices
• A rebuttable presumption of retaliation exists if negative action occurs within 90 days of a complaint

🔹 5. Workplace Violence Prevention (SB 553)

• Effective July 1, 2024 — critical for 2025 implementation
• Requires all California employers to implement a formal workplace violence prevention plan (WVPP), including:
  • Training employees on violence risks
  • Maintaining a log of violent incidents
  • Designating who is responsible for workplace safety
  • Including protocols for de-escalation and emergency response

📍 Especially relevant in healthcare, retail, and public-facing roles

🔹 6. Pay Transparency & Equity Laws

Already in effect, but enforced more rigorously in 2025:

• Pay scale disclosure required in all job postings (even internal)
• Employers with 15+ employees must:
  • Include salary/wage range in every public job ad
  • Maintain records of pay history and job title history for each employee
• Larger employers (100+ employees) must report pay data to CA Civil Rights Department

✅ Tip: HR should regularly audit compensation to avoid pay discrimination and ensure compliance.

🔹 7. Bereavement Leave Laws Clarified

• CA Labor Code now allows up to 5 days unpaid for the death of a family member
• Must be taken within 3 months
• Applies to employers with 5+ employees

Some employers are voluntarily offering paid bereavement leave as part of competitive benefits.

🔹 8. Remote Work Compliance

With hybrid and remote work still strong in 2025, CA law applies based on where the employee performs the work, not where the company is based.

Impacts include:

• Overtime eligibility
• Break requirements
• Local wage rates
• Home office reimbursements (e.g., internet, phone if required)

🖥️ Employers must track:

• Where each remote employee is working from
• Comply with local ordinances, even for out-of-state employers with CA workers

🔹 9. Meal & Rest Break Enforcement

Still highly litigated in CA:

• Meal breaks: 30 min unpaid after 5 hours
• Rest breaks: 10 min paid for every 4 hours worked
• Missed breaks = 1 hour penalty pay per day per missed break

In 2025, there’s increased enforcement and lawsuits for:

• Automatically deducting breaks that weren’t taken
• Failing to provide breaks in remote settings

🔹 10. Use of AI in Hiring and Promotions (Under Watch)

• While CA hasn’t passed full legislation yet, HR pros are advised to:
  • Audit AI-based tools for bias (especially in recruiting)
  • Be ready for future compliance (modeled after NYC and EU AI laws)
  • Keep records of automated decision-making systems and impact assessments

📌 Stay ahead by documenting how hiring decisions are made when using automated tools.

✅ What HR Should Do in 2025

1. Audit exempt classifications (especially in healthcare, tech, and hybrid roles)
2. Update policies for sick leave, reproductive loss leave, bereavement
3. Create a Workplace Violence Prevention Plan
4. Post pay ranges in all job ads
5. Train managers on retaliation protections
6. Track local laws where remote employees are based
7. Ensure timekeeping systems are break-compliant
8. Keep documentation of all wage and hiring decisions