New California Employment Laws for 2020

San Jose business law

California Businesses and Lawyers Should be Aware of New 2020 Laws

In 2020, a number of sweeping new laws will take effect, a factor that will change how California businesses operate and fulfill their obligations. The laws are designed to reduce economic inequality, give workers more power, and curb long-standing employment practices. However, these laws have generated considerable debate, with some stakeholders opposing the changes. As such, both employers and employees should get a San Jose business law attorney to help explain some of the guidelines. 

Below is a highlight of the New California Employment Laws for 2020. Please do not rely on this summary as legal advice. Contact us for a more in-depth understanding of how the new laws may apply to your situation. 

Minimum wages

Minimum wage in the state of California will increase to $13 an hour for employers with over 26 employees. For those with 26 or fewer employees, the minimum wage will step up to $12 an hour. This law will see about 2.6 million Californians getting an increase and the state having the second-highest minimum in the country. Some of the large businesses have already raised their own minimums to $15 an hour.

Independent contractors

In 2018, the California Supreme Court ruled that companies have to satisfy certain conditions before they can classify workers as contractors as opposed to employees. AB 5 codified this idea into law, effective January 1. Generally, for workers not to be subject to minimum wage and overtime laws, they should operate independently from the hiring entity. However, professions whose workers have some level of autonomy and negotiating power received exemptions from the law’s mandates and others, like musicians, are lobbying for the same consideration.


This law will protect workers from mandatory arbitration. Rather than being forced by the company to resolve disputes in private, closed-door sessions, workers can choose to have public court proceedings. The practice of mandatory arbitration can deter workers from bringing claims in case of discrimination, harassment, disability, and other issues. 

Discrimination, harassment, and retaliation

Apart from the arbitration statute, the deadline for filing complaints of discrimination, retaliation, and harassment in court has been extended. AB 9 extends this deadline from the one year to three years. San Jose business lawyers believe that this will allow workers enough time to come to terms with what happened to them before seeking redress.

Child-care workers

Federal labor law does not cover home-based child-care workers. However, private family day-care providers will now enjoy the right to bargain collectively. This could create the largest union election in California since 1997, making it possible for the workers to negotiate wages and working conditions.

Corporate diversity

According to a State Senate bill that was enacted last year, any company that is headquartered in California must include a woman in their board of directors from 2020. By the end of 2021, boards of five should have at least two women, while boards of directors of six or more should have at least three women. Failure to comply with this law will attract a fine of up to $100,000.

Contact Your San Jose Employment Law Attorneys for Guidance

If you are a business owner or an employee based in the San Jose region, and you are eager to know more about these newly-enacted laws and understand its critical impact, contact the Law Office of Farling, Hecht & Davis, LLP. We are a renowned San Jose law firm that’s staffed by experienced and qualified business law attorneys who know the nitty-gritty of California business laws. We provide free consultation on a wide variety of issues and would be happy to assist you with any legal information or disputes that require an expert.