5 Important California Employment Laws Explained

It’s essential that you fully understand the state employment laws as a California business.

There are plenty of laws in the books but these particular ones we see employers get in trouble with over and over again.

Here are 5 major California employment laws explained.

Are you a Californian employer? Are you up to date with California employment laws?

It’s incredibly important that you’re compliant with the employment laws of this state at all times. In April 2017, two Californian employers received prison sentences for failing to adhere to workers compensation rules.

This case is just one among many, but the custodial sentence highlights how important the state considers employment law to be — and how severe the resultant penalties could be.


Here are 5 major California employment laws that you must bear in mind at all times.

For your convenience we have summarized them in a Info-graphic and below that we have a full article explaining each in more detail.


Quick Guide:

5 Important Labor Laws For Employers to Understand Info-Graphic


important california employment laws



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1. Workers Compensation Insurance Is Required

Workers compensation insurance is a requirement for all businesses operating in California.

The exact rules and regulations are devised by the Workers Compensation Insurance Rating Bureau of California. You should either have a read of the regulations yourself or develop a compliance strategy with the help of a lawyer.

Remember, it’s a criminal offense not to secure workers comp for your employees. Not only could your business suffer, you could find yourself personally liable.

This could even mean a few months in prison.

Obviously, it’s equally important to try your best to make sure you’ve provided a safe place to work. But accidents happen, and that’s what workers comp is supposed to protect against.

There are no excuses in the eyes of California employment laws for failing to provide this insurance cover for employees.



2. Fair Employment and Equality

Have you heard of the California Fair Employment and Housing Act?

This act sets out a number of ‘protected classes.’

These are attributes which you must not take into account when choosing who to employ.

They include:

  • race
  • color
  • religion
  • sex
  • age
  • marital status


You must also not consider:

  • disability
  • illness
  • sexuality
  • nationality


This is enforced by the Fair Employment and Housing Commission.

Meanwhile, the California Equal Pay Act says that you must not pay different wages to people of different sexes performing the same job.

Of course, you’re still free to reward more experienced members of your team with better salaries.

But if a junior member of staff was getting paid more than, say, their manager, and they can prove its due to a difference in sex you may be in breach of this act.



3. New Parents and Parental Leave

If you have at least 20 employees, you’ll soon be subject to the new law surrounding parental leave. This is not currently in force but will be from 1st January 2018.

Under the new law, all companies with 20 employees or more must make allowances for new parents.

For employees to qualify for these allowances, they must have worked for at least 1,250 hours over the previous 12 months. That’s approximately 26 hours per week.

If that’s the case, you must allow them to take up to 12 weeks off to spend with their newborn child. This can be any time before the child’s first birthday.

You must allow them to return to their job afterward. If you don’t, you’re in breach of the act.

There are some exemptions from this new law. We’d be very happy to consult with you to inform your business practices in this area.



4. Overtime Pay

Do your employees work for more than 40 hours a week? If so, there are some mandatory overtime pay rules you need to know about. We’ve broken these out into the sections below.

Remember, the minimum wage in the state is $10 per hour if you have 25 employees or less, and $10.50 if you have 26 or more.


Employees who work for between 8 and 12 hours a day

If your employees have worked for more than 8 hours on a single day, you’ll have to pay them a rate of one and one-half their normal rate for all hours in excess of this.

This only applies if they’ve worked for a total of more than 40 hours that week. If you allow some leeway for time in lieu after your employees work late on one day that week, you’ll be OK.

For example, let’s say an employee is scheduled to work a 40 hour week, for 8 hours every day. If they ended up working for 12 hours on Monday, and you let them go home 4 hours early on Friday, they wouldn’t receive overtime for the ‘extra’ hours on Monday.


Employees who work seven days in a row

If an employee works for 7 days in a row, they’re entitled to one and one-half times their normal rate on the first 8 hours of the seventh day.

But again, this is only if they’ve worked for more than a 40 hour week.


Employees who work more than 12 hours in a day

If an employee has worked for more than 12 hours in a single day, they’re entitled to double wages for all hours beyond this.

Once again, this only applies if they’ve worked more than a 40 hour week already.

This means that the careful management of rotas and staffing can actually save you a lot of money.



5. Breaks for Meals and Rest

Your employees have entitlements to breaks for meals and rest.

If an employee has worked for at least 5 hours in a row, you must provide them an unpaid break of 30 minutes. During this time, you cannot force them to work, though if they carry on working regardless this isn’t an issue.

If they must carry on working while eating, you must pay them for that time. However, there’s good news too — you don’t need to provide the meal yourself.

If an employee is working more than 10 hours in a day, you must give them a second 30-minute break during their shift.


California Employment Laws — Who to Consult

If you’re looking for legal advice on employing people in California, contact us at METAL LAW GROUP.

We’re specialist employment lawyers who protect Californian employers against what we see as one-sided laws.

If you need advice or guidance on any aspect of California employment laws, we’re here for you.

We offer a free initial consultation session, and you can book your slot online right now.

We’re looking forward to helping your business.



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