Noncompete agreements in California

Noncompete agreements or clauses in work contracts say that employees may not work for competing businesses when they leave their current employer. Usually, there is a time period of several years involved, and there may be geographic limitations as well. These clauses are also sometimes included in agreements for independent contractors.

Fortunately, California law regarding noncompete agreements favors workers, as these contracts limit the ability of workers to make a living. New legislation for 2024 takes that a step further by removing invalid noncompete agreements altogether.

Assembly Bill 1076 (AB 1076) prohibits the use of noncompete contracts outside of a few very narrow exceptions. Also, employers who required current or former employees after January 1, 2022, to sign a noncompete clause must notify the worker in writing that the clause is void.

California Senate Bill 699 (SB 699) adds that noncompete agreements are unenforceable in California even if an agreement is signed elsewhere. It is a civil violation to try to enforce an invalid noncompete clause or even to include one in an employment contract.

Presumption of retaliation

Senate Bill 497 has made it so retaliation is now presumed if an employee is disciplined or terminated within 90 days of filing a claim of unequal pay or certain other labor violations. If an employer is found to have retaliated against a worker or former worker, they can be penalized up to $10,000 per employee for each infraction.

Increase in paid sick leave

Here’s some news for employees who need to take paid sick leave (PSL). This leave that must be provided by employers to California employees has gone from three days or 24 hours to five days or 40 hours, as per SB 616.

Additionally, the annual cap using the accrual method has been raised to 80 hours or 10 days at minimum (whichever is greater).

Leave must be paid to nonexempt employees at the regular pay rate, which is not always the same as their base pay.

In cases where local law mandates more minimum paid sick leave than the state requires, employers must pay the higher amount. This includes PSL for remote or hybrid workers living in locations with higher mandated sick leave amounts.

Leave following reproductive loss

According to Senate Bill 848, if you are an employer with five or more employees and you have a worker who has been employed for at least 30 days, this law applies to you. If the worker endures a “reproductive loss event,” you must provide them with up to five days of time off.

What constitutes a reproductive loss event?

• Miscarriage
• Stillbirth
• Unsuccessful assisted reproduction
• Failed surrogacy
• Failed adoption

The leave can be taken any time within three months of the event, and it need not be taken all at once. It can be unpaid leave, if you don’t have a policy covering such events, but the employee can opt to use other earned time off (sick leave, vacation time, etc.) to cover the time away from work.

Confidentiality must be maintained as to why the employee is taking time off, and there can be no retaliation or discrimination as a result of the leave or the event that led to it.

Other new labor laws

There are a few other pieces of legislation that may affect California businesses:

• Per AB 594, the California Labor Commissioner may work with public prosecutors to sue employers over wage-and-hour laws, even if the employer and worker have an agreement that limits this type of legal action.
• Employers may not discriminate against employees and job candidates based on someone’s prior cannabis use, including their criminal history related to cannabis use, unless certain state or federal jobs allow for cannabis use/history screening (law passed in 2022 via SB 700 for enactment in 2024).
• Many employees laid off in hospitality and service industries during the COVID-19 pandemic must be rehired if they were employed for at least six months (SB 723 law applies through December 31, 2025).
• According to SB 476, if an employee is required to have a food handler card, their employer must cover all costs associated with obtaining the card, including training, testing, and fees. Time off for the training course and exam must be provided, and employment cannot be conditional on a worker already possessing the card.
• Trial courts will now have discretion to decide whether to stay court proceedings or allow a lawsuit to go forward if there is an appeal after arbitration, per SB 365.

New Employment Laws Effective Later in 2024

There are other laws governing employment in California that will become effective later in 2024:

•  AB 1228 provides for a minimum wage increase this summer for employees of fast food chains with more than 60 locations nationwide to $20 per hour.
•  A minimum wage (hourly and salaried) increase for healthcare workers becomes effective in June, thanks to SB 525, and will be implemented based on several different wage schedules based on the workplace.
• Senate bills 553 and 428 enhance workplace violence prevention by requiring employers to have written plans and training to fight workplace violence. By 2025, it will be easier for employees subjected to workplace violence or threats of violence to obtain restraining orders against perpetrators.

As attorneys for workers in California — specifically the Los Angeles area — our team at Employee Law Group sees workplace violations on a daily basis, including wage theft, discrimination, harassment, and whistleblower retaliation. The penalties for employers who are found guilty of these violations are stiff and may be so financially punitive that a business could be forced to close its doors.

Don’t wind up on the wrong side of the law if you are a California employer! Learn about these new laws for 2024 so you can follow them when the calendar changes.

Are you a worker who believes your rights have been violated by your employer? Employee Law Group can help. Your first consultation is completely free and does not obligate you to any further action. It gives you the opportunity to see if you have a case and lets you know clearly what your next options are.

Call Employee Law Group at 310-407-7358, or reach out online to let us know how we can assist you.