Senate Bills 642 and 464 are set to take effect at the start of the new year, bringing important changes to the California workplace. Weintraub employment attorneys Lizbeth “Beth” West and Lukas Clary break down these new laws and what employers need to know on this episode of California Employment News.

Watch this episode on the Weintraub YouTube channel.

2025 has delivered a series of powerful—and practical—employment law decisions. These five cases carry direct lessons for every California employer, especially in areas where minor missteps can lead to major liability.

1. Iloff v. Bridgeville Properties, Inc. – California Supreme Court (2025) – “Good Faith” Requires Real Effort

This case involved a handyman who performed maintenance work on a rural property owned by Bridgeville Properties. Under an informal arrangement, the worker lived rent-free in a house on the property but received no wages, no time records, and no benefits.

When he was terminated, he filed claims with the Labor Commissioner. Both the Commissioner and the trial court held he was an employee, not an independent contractor. The trial court denied liquidated damages, finding the owners acted in “good faith.”

The Supreme Court reversed, clarifying that:

• A good-faith defense requires evidence the employer actually researched or attempted to comply with minimum wage obligations.
• “Good intentions” or “ignorance of the law” are not enough.
• Employers appealing Labor Commissioner decisions must expect employees to raise Paid Sick Leave claims as part of the appeal—even if the Commissioner declined to address them.

More Facts:

• The employer never sought legal advice or reviewed wage requirements.
• There was no written agreement regarding housing-for-work exchanges.
• The Court found the arrangement “informal, undocumented, and unlawful.”

Employer Lesson:
You must be able to prove compliance efforts—policies, legal consultation, documentation. Good faith now requires a paper trail.

2. Kruitbosch v. Bakersfield Recovery Services – Cal. Ct. App., 5th Dist. (Sept. 2025) – HR’s Response Can Create Liability

This case underscores how an employer’s response to a harassment complaint can itself create a hostile work environment under FEHA—even when the underlying conduct occurs off-duty.

The plaintiff, a male employee, was harassed off-duty by a female coworker, Sanders, who allegedly sent him nude photos, propositioned him for sex, offered him drugs, and even showed up at his home uninvited.

Critical Additional Facts:

• The plaintiff immediately reported Sanders’s behavior to acting program director Stephanie Carroll.
• HR representative Kimberly Giles was also informed that Sanders had sent nude photos, made sexual propositions, offered drugs, and appeared at the plaintiff’s residence.
• Carroll told the plaintiff there was “not much she could do” about Sanders’s conduct.
• That same day, Giles posted a social media video of whining dogs with the caption: “‘This is a work day at thr [sic] office … lmbo.’” This was widely understood by staff as mocking the plaintiff’s complaint.
• Later that week, Giles sarcastically told the plaintiff: “‘I hope you don’t get no more pictures.’”
• At no point did Carroll, Giles, or Bakersfield Recovery Services (BRS) attempt to separate the plaintiff from Sanders, investigate, or take corrective action.
• No discipline was issued to Sanders.

The Court Held:

• The employer’s mockery, dismissiveness, and inaction—not the off-duty conduct—created a hostile work environment.
• FEHA liability arises when the employer’s response is itself harassing, belittling, or indifferent to an employee’s safety.
• Other claims (retaliation, constructive discharge) were dismissed only because there was no adverse employment action.

Employer Lesson:

An employer doesn’t get to hide behind the fact that harassment occurred off-duty. What also matters is how management responds when concerns are raised. Mockery, sarcasm, or inaction can transform an external problem into an internal FEHA violation.

3. Carranza v. City of Los Angeles –California Court of Appeal (2025) – Digital Harassment, Employer Inaction, and a Difficult Judgment Call

This case involved a LAPD Captain, one of the highest-ranking female officers in the department. She learned that a topless photo purporting to be her (but it was not) was circulating among officers on duty.

Key Additional Facts:

• Officers were seen viewing the photo in police stations and making lewd remarks.
• Multiple officers reported the image was being shared “everywhere” in the department.
• Carranza repeatedly asked the Department to issue a message stating the photo was not her and ordering officers to stop circulating it.
• LAPD leadership discussed issuing the statement but ultimately declined.

Why the Employer’s Position Was Complicated:
The City argued—and the evidence confirmed—that leadership faced a genuine dilemma:

• Issuing a department-wide notice might amplify the issue, causing 13,000 employees who had never seen the photo to now seek it out.
• Leadership feared that a public statement might increase curiosity and worsen the situation.
• They believed an ongoing investigation could be compromised by an all-hands notice.

Nevertheless, the Court held the employer liable because:

• The City took no visible action to stop or condemn the conduct.
• Carranza’s knowledge of widespread circulation alone was enough to establish a hostile work environment.
• The environment became “severe or pervasive” when the employer refused to repudiate the conduct.

Outcome:

• Jury awarded $4 million in noneconomic damages.
• Court of Appeal affirmed the verdict and the attorney fee award.

Employer Lesson:
Digital harassment—including doctored images, rumors, and misinformation—creates new challenges. Even when an employer’s instinct is to avoid “drawing attention,” FEHA requires affirmative action when harassment is known.

4. Hohenshelt v. Sup. Ct. (Golden State Foods Corp.) – California Supreme Court (2025) – Arbitration Fee Deadlines Clarified

This case addressed whether late payment of arbitration fees automatically forfeits the employer’s right to arbitrate under CCP §1281.98.

More Facts:

• The employer’s payment was slightly late due to internal administrative error.
• The employee attempted to escape arbitration by arguing the employer forfeited its rights.
• The trial court found forfeiture; the employer petitioned the Supreme Court.

The Supreme Court Held:

• The FAA does not preempt California’s statute—but the statute must be read consistent with traditional contract principles.
• There is no automatic forfeiture for late payment caused by mistake, excusable neglect, inadvertence, or non-willful delay.
• Courts must consider the specific circumstances.

Employer Lesson:
Employers should still implement tracking systems for arbitration invoices—but this case gives relief from “gotcha” attempts to weaponize minor payment delays.

5. Noland v. Land of the Free, L.P. – California Court of Appeal, Second District (2025) – AI “Hallucinations” Lead to $10,000 Sanction

This case has drawn attention as one of the first California appellate decisions sanctioning an attorney for unverified generative AI work product.

More Facts:

• Plaintiff’s counsel used AI to generate appellate arguments, including fake cases, fake quotations, and misstatements of law.
• The offending attorney admitted he had not read or verified the authorities and had used AI to generate the brief.
• The Court referred the attorney to the State Bar.

The Court’s Warning:

“[N]o brief, pleading, motion, or any other paper filed in any court should contain any citations…that the attorney responsible for submitting the pleading has not personally read and verified.”

Final Outcome:

• Judgment for the employer was affirmed.
• The attorney was sanctioned $10,000.

Employer Lesson:
AI-generated content is increasingly making its way into legal disputes, employee complaints, and internal reports. While it can be a good starting point Employers and counsel must verify accuracy—not assume AI outputs are reliable.

Final Thoughts

Across these decisions, a few themes stand out for California employers in 2025:

• Documentation = defense. Courts want to see real compliance efforts.
• Employer response matters. HR missteps often create more liability than the underlying misconduct.
• Silence is rarely safe. Especially in digital harassment cases.
• When in arbitration – ensure all fees are paid promptly to avoid losing ability to keep a case in arbitration.
• AI must be supervised. Verification is mandatory.

The post Five 2025 Employment Law Cases California Employers Need to Understand appeared first on California Employment Law Report.

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California Wage Theft Ledger – November 10, 2025

Hello, accountability advocates! Our deep dive into the California Department of Industrial Relations (DIR) news archives yields no new citations or enforcement alerts from the Labor Commissioner’s Office over the past day—calm waters in the ongoing battle.

Spotlight: Healthcare Wage Theft – Shift Extension Sneaks & On-Call Exploitation

Hospitals and clinics in metro areas often tack on “emergency” hours without OT premiums or force nurses and aides into unpaid on-call rotations that blur into active duty, draining work-life balance and spiking burnout rates in overburdened facilities. This tactic preys on dedicated staff during staffing shortages. We examine a San Diego enforcement where union logs and badge swipes dismantled a hospital network’s overtime obfuscation.

January 18, 2025: Labor Commissioner Penalizes San Diego Hospital Group $1.3M for On-Call and OT Violations

• Employers: Pacific Health Partners (dba Coastal Medical Centers); affiliated clinics
• Locations: San Diego County (Chula Vista, La Mesa campuses)
• Workers Affected: 105 nurses, CNAs, phlebotomists
• Violations: Unpaid on-call time exceeding 20% active response rate; OT skipped on extended 12+ hour shifts; meal breaks interrupted without premium pay; inaccurate call-back records
• Amounts Assessed: $1,312,500 total—$980K in back pay/penalties to employees; $332K civil fines
• Case Background: Triggered December 2023 by CNA union filings; BOFE reviewed access logs and schedules spanning 17 months, exposing systemic gaps; aligns with $25M+ healthcare recoveries post-2022.

Labor Commissioner Lilia García-Brower stated: “Healthcare heroes can’t be shortchanged on rest or readiness—on-call must be truly optional and compensated when it turns mandatory. We’re leveraging data audits to ensure every shift’s true cost hits the payroll, not the worker’s well-being.”

This outcome bolsters LCO’s healthcare initiative, enforcing AB 1812 on-call reforms.

Healthcare Protections: On-Call Rules, Breaks, and Shift Pay

• Vital Standards: On-call paid if restricted (home wait >20% active); 1.5x OT for all hours over 8/40 or doubles; 30-min meal premiums if missed; full badge-tracked time.
• Staff Tactics: Log interruptions via apps; union-coordinate claims; file swiftly at dir.ca.gov/dlse/HowToFileWageClaim.htm (3-year window, protected).
• Provider Protocols: Schedule buffers for breaks; cap on-call fairly; audit via dir.ca.gov/dlse/OnCallFAQ.htm; integrate with BOFE’s sector sweeps.

Reach 833-LCO-INFO for Thai, Tigrinya, Bengali support—vital lines.

Tomorrow’s tracking on deck. Harvested from DIR depths.

California’s employment laws never stay still—and 2025 and 2026 are shaping up to bring even more compliance challenges for employers. One of the biggest new laws on the horizon is Senate Bill 294, better known as the Workplace Know Your Rights Act.

This new law adds major notice, training, and recordkeeping requirements for all California employers and aims to ensure workers clearly understand their rights on the job. Here are five key takeaways every California employer needs to know to stay compliant.

1. Annual Written Notice to Employees (Effective February 1, 2026)

Starting February 1, 2026, employers will be required to give employees a standalone written “Know Your Rights” notice every year.

• The notice must go to all current employees each year and to new hires upon hire.
• Employers can deliver the notice by email, text message, or personal delivery—whatever communication method is normally used with employees.
• If employees are represented by a union, the authorized representative must receive a copy as well.

This new rule is designed to make sure every worker in California receives clear, accessible information about their workplace rights—directly from their employer.

2. What Must Be Included in the Notice

The annual Know Your Rights notice must cover a range of critical employment protections, including:

• Workers’ compensation rights and contact details for the Division of Workers’ Compensation
• Employee rights during immigration inspections, including notice requirements under Labor Code section 90.2
• Protections against unfair immigration-related practices
• The right to organize, form, or join a union, or to engage in concerted activity
• Constitutional rights in the workplace during law enforcement actions, including:
  • Fourth Amendment protection against unreasonable searches and seizures
  • Fifth Amendment protection against self-incrimination and right to due process

The Labor Commissioner will issue an official notice template by January 1, 2026, and translations must be provided in the languages normally used with employees (if available on the Commissioner’s website).

Tip for Employers: Keep a record of your notice distribution in your HR system or onboarding software. Tracking delivery electronically will make annual compliance much easier.

3. Recordkeeping Requirements: Keep Proof for Three Years

Employers must keep proof of notice delivery for at least three years. This proof can include:

• Signed acknowledgment forms
• Digital read receipts or confirmation emails
• HR system logs

Strong documentation will be key if the Labor Commissioner or another enforcement agency requests verification.

For California HR teams, this is a good time to audit your employee recordkeeping process and ensure that all required workplace postings and notices are organized in one place.

4. New Educational Videos and Employer Resources

The Labor Commissioner’s Office will also release two educational videos by July 1, 2026:

1. A video for employees explaining their workplace rights.
2. A video for employers outlining compliance requirements and constitutional protections.

Employers should plan to include these videos in onboarding, annual training, or even all-hands compliance refreshers to demonstrate good-faith efforts at compliance.

For updates on when these materials become available, make sure you are subscribed to receive updates at California Employment Law Report.

5. New Employee Protections and Deadlines

By March 30, 2026, employers must allow employees to designate an emergency contact who should be notified if they are arrested or detained at work.

The law also contains anti-retaliation protections, meaning employers may not retaliate against employees who exercise or assert any of these rights.

In addition, the Labor Commissioner will specify future updates that must be included in the annual notice—so staying current will be essential for ongoing compliance.

Final Thoughts: Get Ready Now for the Workplace Know Your Rights Act

The Workplace Know Your Rights Act (SB 294) is part of California’s broader trend toward greater workplace transparency and employee education.

Employers should start preparing now by:

• Reviewing HR communication systems to ensure notices can be distributed electronically.
• Creating a calendar reminder for February 1, 2026 to deliver the first annual notice.
• Checking the Labor Commissioner’s website in early 2026 for the official templates and translated versions.
• Consulting with employment counsel to ensure all language and formatting meet legal requirements.

The post The Workplace Know Your Rights Act: 5 Things California Employers Must Understand Before 2026 appeared first on California Employment Law Report.

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