The Civil Rights Department’s new regulations, which went into effect October 1, 2025, now prohibits the use of Automated Decision Systems (ADS)—including AI tools—in employment decisions (hiring, promotion, etc.) if they result in discrimination based on protected characteristics under the Fair Employment and Housing Act. This change significantly increases employer liability, as vendors of these tools may be considered employer “agents,” and employers are required to retain all ADS-related data (screening results, outcomes, vendor reports) for a minimum of four years. To comply, companies should expand their non-discrimination/EEO policy in handbooks to mandate that:

• Any use of software, algorithms, or automated tools for recruitment, promotions, performance, or termination must be carefully vetted to ensure no disparate impact.
• Employees may inquire about the use of such tools in decisions affecting them.
• The company will maintain appropriate documentation and oversight of all ADS use.

Source:  Fox Rothschild

Starting February 1, 2026, and every year thereafter, companies must give all employees a separate written notice outlining their core workplace rights. This annual notice must cover:

• The right to workers’ compensation benefits
• The right to be informed of immigration-agency inspections
• Protections against “unfair immigration practices”
• The right to unionize or engage in concerted activity
• Constitutional rights during law enforcement interactions at work
• Any material new legal developments as determined by the Division of Labor Standards Enforcement (DLSE) and a list of relevant enforcement agencies.

DSLE will post the template notice by January 1, 2026, and employers must use the template provided.  Employers can deliver the notice using customary methods like email or text, provided it is sent within one business day, or through personal notice. Additionally, the new law requires employers to notify an employee’s designated emergency contact if the employee is arrested or detained while at work. This program must be implemented by March 30, 2026. Source:  Proskauer Source:  Husch Blackwell Source:  Vorys, Sater, Seymour and Pease

California law (LC 1198.5) presently requires employers to provide current and former employees access to their personnel files (and copies if requested) covering performance and grievances (e.g., evaluations, warnings, attendance, investigation files).Effective January 1, 2026, the definition of “performance” records now includes all education and training records maintained by the company. Ensure your records contain the employee’s name, provider, date/duration, core competencies (including equipment/software), and resulting certification/qualification.Key Compliance Points:

• Response Timeline: Must respond to a written request within 30 days (or up to 35 days by written agreement).
• Retention: Keep personnel records for a minimum of three years after an employee separates.
• Penalty: Noncompliance risks a fine per violation plus attorneys’ fees.

Source: Vorys, Sater, Seymour and Pease

We invite you to reach out to us for support on matters such as reviewing your employee handbook, crafting policies, employee relations issues, benefits management, scheduling and training employees on Harassment Prevention Training, or any other HR matters.  Please feel to reach out to us at [email protected] for support.