Skip to Main Content
Quick and Easy Guide to Labor & Employment Law: California

This state-specific guide covers labor and employment case law, statutes, rules, and regulations that HR professionals and clients often encounter or have questions about in California.

At-Will Employment

In California, there is a presumption of at-will employment absent an express agreement specifying length of employment or grounds for termination. Foley v. Interactive Data, 47 Cal. 3d 654,677 (1988). Employment for specified term means an employment for a period greater than one month. Cal. Lab. Code § 2922. This means that either party may terminate the relationship at any time, with or without cause, and with or without notice. § 2922

California courts have recognized numerous limitations and exceptions to at-will employment. An employee termination may not be “motivated by legally proscribed, invidious discriminatory attitudes, such as animus toward a particular race or gender.” Jie v. Liang Tai Knitwear, 89 Cal. App. 4th 654, 660 (2001).

Additionally, an employee may maintain a tort claim against their employer if their termination violates an important public policy. To succeed on a claim of wrongful termination under the public policy exception, an employee must prove (1) the policy they were in violation of or refused to violate is set forth in law, either by statute or constitutional provision, (2) the policy benefits the public, (3) the policy is fundamental and substantial, and (4) the policy was well established at the time of termination. City of Moorpark v. Superior Court, 18 Cal. 4th 1143, 1159 (1998). Furthermore, the employee must be able to show a clear connection between their actions in support of the policy and their termination. Turner v. Anheuser-Busch, Cal. 4th 1238, 1251 (1994).

The presumption of at-will employment may be overcome by implied contract. See Foley v. Interactive Data, 47 Cal. 3d 654, 677 (1988). Whether an implied contract exists between an employer and employee depends on what the parties intended the terms of employment to be. Id. The court considers numerous factors when determining if an implied contract existed, such as the employer's general practices, the length of employment, behavior or communications by employer reflecting assurance of continued employment, and the practice industry in which the employee is involved. Id. at 680.

Finally, if an employment contract existed, either express or implied, an employee may have a tort claim against their employer for wrongful termination under the implied covenant of good faith and fair dealing. The covenant of good faith and fair dealing is violated when an employer acts in bad faith to intentionally frustrate an employee's right to continue employment absent good cause for termination. Kelecheva v. Multivision Cable T.V., 18 Cal. App. 4th 521, 531–32 (1993).

Right to Work Laws

California does not have a right to work law. Therefore, an employee can be compelled to join a union or pay dues as a condition to employment.

Immigration Verification

Except for those employers required to do so under federal law or as a condition of receiving federal funding, an employer cannot use E-verify to check the employment authorization status of an existing employee or an applicant who has not been offered employment. Cal. Lab. Code §2814(a)(1). An employer can use E-verify after an offer has been extended to an applicant to check their employment authorization status.

If an employer receives a tentative non-confirmation, the employer must give the employee notice as soon as practicable of any tentative non-confirmation or notification issued by the SSA or DHS containing information specific to the employee's case. Cal. Lab. Code §2814(b).

Failure to comply with the E-Verify law may result in a civil penalty of up to $10,00 for each violation. Cal. Lab. Code §2814(c).

Drug Testing

California allows employers to drug test employees as a condition of employment. See Loder v. City of Glendale, 14 Cal. 4th 846, 896–97 (1997). Once employed, an employer may require drug testing if there is reasonable suspicion of drug use by a specific employee. However, an employee's constitutional right to privacy prevents an employer from instituting random drug testing except in narrow circumstances such as for public jobs with a high degree of responsibility and jobs where public safety is concerned.

Each employer who receives medical information must establish procedures to ensure the confidentiality from unauthorized use and disclosure of that information. Cal. Civ. Code §56.20(a). No employee shall be discriminated against due to the refusal to sign an authorization; however, an employer may disqualify an applicant or employee who refuses to authorize the employer to view the results of a drug test. Id.; Loder, 14 Cal. 4th at 862.

Jury Duty Leave

It is unlawful for an employer to discharge or in any manner discriminate against an employee for taking time off to serve as required by law on a jury, if the employee gives reasonable notice that they are required to serve. Cal. Lab. Code §230(a). Employers are not required to pay their employees while on jury duty leave; however, an employee may use vacation, personal leave or compensatory time off for the purpose of jury service. See §230(i).

Voting Leave

Employees in California are eligible for paid time off for the purpose of voting if they do not have sufficient time outside of working hours to vote. Cal. Elec. Code §14000(a). A maximum two hours of that time is required to be paid leave. §14000(b). If an employee has reason to believe they will need time off to vote on election day, he or she must provide their employer with two working days' notice. §14000(c).

Parental Leave

An employee who has worked for an employer that directly employs five or more persons to perform services for a wage for more than 12 months and has worked at least 1,250 hours during the previous 12-month period is entitled to take up to 12 workweeks in any 12-month period for family care or medical leave. Cal. Gov’t Code §12945.2. However, California employers are not required to provide paid parental leave. An employee may elect or be required to use vacation leave or other accrued time off during their leave. §12945.2(d). An employer must maintain an employee's health insurance coverage during family care or medical leave. §12945.2(e)(1).

California has a paid family leave program operated by the Employment Development department where employees can receive partial wage replacements during leave. To qualify for the program, an employee must have earned at least $300 or more in wages during the preceding 12-month period and they must be taking leave to care for a seriously ill family member, to bond with a new child or to participate in a qualifying event resulting from a family member’s military deployment to a foreign country. Eligible employees will receive 60-70 percent of their average weekly earnings, for up to eight weeks, up to a maximum set by California law.

For information visit edd.ca.gov/disability/paid-family-leave/.

Other Leave

Military Leave

Any public employee who is a member of the reserve corps of the Armed Forces, National Guard or Naval Militia is entitled to temporary military leave for up to 180 calendar days. Cal. Mil. & Vet. §395(a). . §395(c). If that position ceases to exist, the employee will be entitled to a position of similar seniority and status. Id.

Sick Leave

An employee who has worked for an employer, full-time, part-time or temporarily, for at least 30 days is entitled to sick leave. Cal. Lab. Code. §246(a). Sick leave accrues at the rate of one hour per every 30 hours worked, beginning at the first day of employment. §246(b)(3). An employee can begin using paid sick leave on the 90th day of employment. §246(c). Paid sick leave may be carried over into the next year §246(d), but it may be limited to 48 hours. §246(j).

Vacation Leave

Employers in California are not required to provide employees with either paid or unpaid vacation time.

Smoking Laws

In California, the smoking of tobacco products at a place of employment or in an enclosed space is prohibited. Cal. Lab. Code §6404.5(c). Employers must take reasonable steps such as posting signage to prevent smoking in enclosed workspaces. See §6404.5(d)(1).

Break Time to Express Milk

Employers must provide a reasonable amount of break time to accommodate an employee who seeks to express breast milk for each time needed. Cal. Lab. Code §1030. The break time shall run concurrently with other allotted time for rest and meals. §1030. Additionally, an employer must provide a breastfeeding employee with the use of a room, other than a restroom, to express breast milk. Cal. Lab. Code §1031. An employer may be exempt from these provisions if such accommodation would impose undue hardship by causing the employer serious difficulty or expense in relation to their operation. §1031(i).

Meal Breaks

Employees who work for longer than five hours per day must be provided with a meal period of no less than 30 minutes; however, an employee can waive this break if he or she does not work more than six hours in the workday. Cal. Lab. Code §512(a). Employees who work in excess of ten hours a day are entitled to a second meal period of no less than 30 minutes. §512(a). An employee can waive his or her second break if the workday is under 12 hours and he or she did not waive their first meal break. See id. However, in January 2021, the meal rules were recently found to be unconstitutional as applied to drivers of property-carrying commercial motor vehicles. International Brotherhood of Teamsters, Local 2785 v. Fed. Motor Carrier Safety Admin., 986 F.3d 841 (9th Cir. 2021).

Minimum Wage, Overtime and Wage Recordkeeping

Beginning, January 1, 2021, the State of California set minimum wage at not less than $14 per hour for employers with 26 or more employees and $13 per hour for employers with 25 or fewer employees. Cal. Lab. Code. §1182.12(b). Employers must still comply with federal wage laws and regulations. Cal. Lab. Code §351. An employer cannot take, collect or receive a tip left for an employee, nor may an employer reduce a tipped employee's wages on account of gratuity. Id.

If an employee works more than eight hours a day or 40 hours in one work week, he or she must be compensated at a rate of one and one-half times the regular rate of pay at which he or she is employed. Cal. Lab. Code §510(a). Any work in excess of 12 hours a day will be compensated at a rate of two times the regular rate of pay. Id.

Every employer shall make and keep for a period of not less than three years a record of any employee is employed a record of the name, address and occupation of each of his or her employees, the rate of pay and the amount paid each pay period to each employee.

Final Payments

The State of California requires an employer to issue a final paycheck for wages earned and unpaid at the time of discharge immediately. Cal. Lab. Code §201(a). If an employer lays off a group of employees for termination of seasonal employment, immediate payment has been achieved if they are paid within a reasonable time as necessary for computation, so long as that time does not exceed 72 hours. Id.

Unemployment Insurance

Unemployment insurance benefits provide income to individuals who have lost work through no fault of their own. The benefits are intended to partially offset the loss of wages while an unemployed worker searches for suitable work or until an employer can recall the employee to work. Nothing is deducted from the employee's wages to pay for this coverage. Unemployment benefits are administered by the California Employment Development Department and additional information regarding the benefits may be accessed at https://edd.ca.gov/unemployment/.

Workers' Compensation

In California, an employer is liable to compensate for any injury sustained by their employees arising out of and in the court of their employment and for the death of any employee if the injury proximately causes the death. Cal. Lab. Code §3600(a). This is the sole remedy of an employee against their employer. Cal Lab. Code. §3602(a). Additional information regarding workers’ compensation may be accessed at www.dir.ca.gov/dwc/dwc_home_page.htm.

Child Labor

Generally, 14 years is the minimum age for legal employment under California state law. Cal. Lab. Code §1294.3. Minors between ages 14 – 17 seeking employment in the entertainment industry must obtain a work permit. Cal. Lab. Code §1700.52. There are restrictions for places of work dealing with minors, as well as restrictions on the hours of the day the minor may work. The laws may be found at www.dir.ca.gov/dlse/minorssummarycharts.pdf.

Gun Laws

California does not have a "guns at work" law requiring employers to allow employees with conceal carry permits to leave guns in their locked vehicles in the employer's parking lot. Therefore, an employer may ban an employee from bringing weapons into the workplace.

Polygraph Testing

Private employers cannot require a potential employee to submit to a polygraph or lie detector test as a condition to employment; this does not apply for the federal and state government/agencies. Cal. Lab. Code § 432.2.

Equal Pay

An employer cannot discriminate the basis of gender by paying wages to employees at a rate less than the rate at which the employer pays wages to employees of the opposite gender for equal work on jobs the performance of which requires equal skill, effort and responsibility. Cal. Lab. Code § 1197.5.

Non-Compete Agreements

California broadly bans non-compete agreements. Cal. Bus. & Prof. Code Section 16600 provides that "every contract by which anyone is restrained from engaging in a lawful profession, trade or business of any kind is to that extent void." There are very narrow exceptions. 

Have Questions?
Let's Talk!

Click the button above to reach out to a
Baker Donelson L&E Professional.

Disclaimer: These materials do not constitute
legal advice and should not be substituted
for the advice of legal counsel.

Guide last updated July 2021.

Email Disclaimer

NOTICE: The mailing of this email is not intended to create, and receipt of it does not constitute an attorney-client relationship. Anything that you send to anyone at our Firm will not be confidential or privileged unless we have agreed to represent you. If you send this email, you confirm that you have read and understand this notice.
Cancel Accept