Effective January 1, 2025, California employers will face an expanded compliance landscape with the introduction of Senate Bill (SB) 1340. Signed into law by Governor Gavin Newsom, this new legislation allows local governments to enforce employment discrimination laws that go beyond the protections offered by the state. Businesses will need to address compliance challenges beyond those set by California’s Fair Employment and Housing Act (FEHA) and the Unruh Civil Rights Act, as local agencies gain authority to enforce more stringent anti-discrimination regulations.
For additional information regarding California employment laws and to find out how this could impact your business, please contact our Managing Partner, Richard Liu, at richard.liu@consultils.com.
Key Changes Introduced by SB 1340
Previously, only the California Civil Rights Department (CRD) could enforce employment discrimination laws. SB 1340 allows local governments—including cities and counties—to enforce both state-level and more stringent local anti-discrimination laws, subject to several conditions:
Local authorities can act only after an employee files a complaint with the CRD and receives a right-to-sue notice.
Local enforcement must begin before the expiration of the time limit specified in the right-to-sue notice.
The local laws being enforced must be at least as protective as FEHA.
Additionally, the time allowed for an employee to file a civil lawsuit is paused while local enforcement is ongoing, extending the potential litigation timeline for employers.
Steps Employers Should Take
The expanded enforcement authority creates new challenges for businesses. Employers should consider the following actions to prepare:
Stay Informed on Local Regulations
Employers must remain informed about local anti-discrimination laws, as these regulations can impose stricter standards than state law. It is crucial to understand and comply with any additional obligations that may arise from these local laws. Legal counsel can help provide clarity and guide businesses in meeting these requirements.
Be Prepared for Longer Litigation Timeframes
The tolling provision in SB 1340 means that the clock for filing a lawsuit is paused during local enforcement efforts, which could significantly extend the litigation timeline. Employers should be mindful of this potential delay and be prepared for a prolonged period of exposure to legal claims.
Reevaluate Internal Policies and Previous Complaints
With increased enforcement authority and the possibility of stricter local standards, employers should review their current anti-discrimination policies and practices. Additionally, revisiting past discrimination complaints to confirm that they were adequately resolved will help identify and address any lingering issues. Ensuring compliance now can reduce the risk of future disputes.
Conclusion
The implementation of SB 1340 brings significant changes to the enforcement of employment discrimination laws in California. Employers must adapt to the potential for more stringent local standards and longer timelines for litigation. By staying informed, reviewing internal policies, and being ready for extended enforcement actions, businesses can better manage these new compliance challenges.
For additional information regarding California employment laws and to find out how this could impact your business, please contact our Managing Partner, Richard Liu, at richard.liu@consultils.com.
Disclaimer: The materials provided on this website are for general informational purposes only and do not, and are not intended to, constitute legal advice. You should not act or refrain from acting based on any information provided here. Please consult with your own legal counsel regarding your specific situation and legal questions.
Richard Liu, Esq. is the Managing Counsel of ILS. He serves clients as a management-side defense lawyer specializing in employment and business litigation. Richard is also an expert on litigation prevention and compliance. He regularly advises Fortune 500 companies and startups on employment, labor, and commercial matters.
Email: richard.liu@consultils.com | Phone: 626-344-8949
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