Workplace Laws Going into Effect on January 1, 2025

We’re highlighting some of the changes to workplace laws that go into effect on January 1, 2025. As always, complying with the ever-changing landscape of workplace rules continues to be a challenge for employers, and while we have endeavored to provide you with a snapshot of new employment laws, this summary does not cover all changes across all industries. We recommend working with one of our employment attorneys to ensure your policies and practices are up to date going into 2025.  

Independent Contractor Contract Requirements 

California companies that work with freelancers (for services greater than $250) will be required to enter into written contracts and keep records of the same beginning on January 1, 2025. The contracts must include:  

• The name and mailing address of each party. 

• An itemized list of services, including the rate and method of fees paid.  

• The contract date.  

• Timelines for freelancer invoicing to allow for payment within the mandated period.  

The new law requires freelancers be paid within 30 days if the contract is silent on payment timing. Parties may agree to longer payment terms, but the contract must explicitly  state those terms. The law also restricts a company’s ability to update key terms relating to payment, the scope of work, and assignment of IP after the freelancer’s services have commenced. Again, well-drafted contracts will be essential for companies utilizing freelancers moving forward.  

The original text of the bill also reminds companies of the importance of properly classifying contractors in accordance with the existing ABC test.  

California’s Captive Audience Law 

California’s Captive Audience law prohibits employers from taking or threatening adverse actions against an employee because “the employee declines to attend an employer-sponsored meeting or affirmatively declines to participate in, receive, or listen to any communications with the employer or its agents or representatives, the purpose of which is to communicate the employer’s opinion about religious or political matters.” At a time when union activity is at an all-time high across the nation, this new law covers anti-unionization meetings. 

It’s important to note that employers are not restricted from holding the meetings, and employees may still attend them voluntarily. But managers should receive training about this new law and its scope and potential impact to the workplace.  

Changes To California’s Paid Family Leave Program 

Starting in 2025, employers may no longer require employees to use accrued paid time off before receiving California’s paid family leave benefit. This change applies to leaves beginning on or after January 1, 2025. 

Driver’s License Requirement Restrictions 

Beginning on January 1, employers will be prohibited from requiring applicants and employees to have a driver’s license unless:  

1. Driving is one of the main functions of an employee’s role; and 
2. The employee is unable to satisfy that ‘main function’ using alternative forms of transport that are of comparable cost and efficiency.  

This bill is designed to reduce discrimination against workers whose primary forms of transportation include walking, public transport, ride-sharing, or cycling. It also reduces barriers for those unable to drive due to cost or disability. 

Suggested Updates to Your Existing Policies 

• California state minimum wage increases to $16.50 per hour and the exempt-employee minimum salary is $68,640 in 2025. (Keep in mind, many local jurisdictions have higher minimum wage requirements.) 
• Your Equal Employment Opportunity policy should be updated to reflect the new ‘intersectionality’ law which recognizes and protects individuals with two or more protected characteristics.  
• Remove driver’s license requirements from your job postings and onboarding documents, unless driving is a job function of that role.  
• Add a Workers Compensation poster to your handbook. (See sample posters here) 
• Add Whistleblower protection notices to your handbook. The sample posting provided by the Department of Industrial Relations (that comes with the benefit of ‘deemed compliance’ with notice requirements) is available here.  
• If you included the word ‘historically’ in your Equal Employment Opportunity notices to comply with the CROWN Act, you should remove this word to align with recent amendments. 
• Update your leave policy to reflect the amendments to the Family Paid Leave law.  
• Update employee 401(k) and 403(b) plans to automatic enrollment, instead of opt-in.  

We also suggest companies work with legal counsel to develop a compliant independent contractor template contract.  

If you need assistance with workplace compliance in 2025, reach out. Our team is available to help.  

• Employment Law