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California Legislature Advances AI Employment Bills

By Lindsey Tonsager, Carolyn Rashby & Bryan Ramirez on September 15, 2026
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At the end of August, the California legislature passed three bills that would regulate the use of AI in the employment context. These bills are now on Governor Newsom’s desk, and he has until September 30 to sign or veto. Below is a summary of the three bills.

SB 947 (The “No Robo Bosses Act”)

SB 947 would place certain restrictions on employers’ use of automated decision systems (“ADS”), which is defined in the legislation to include technologies that issue simplified outputs, including a score, classification, or recommendation, that is used to assist or replace human decision making and materially impacts natural persons. For example, the bill would prohibit an employer from using ADS to infer an employee’s protected status or to predict and take adverse action against a worker for exercising their legal rights. The bill would also prohibit using ADS to make disciplinary or termination decisions, unless the employer directs a human to corroborate the ADS output with supporting information such as employee work product, manager evaluations, or personnel files. Additionally, an employer that primarily relies on ADS to make a disciplinary or termination decision must provide the employee with a post-use notice at the time the employer informs the employee of the decision. The post-use notice would need to, among other things, describe the employee’s right to access a description of the employee’s own data used by the ADS and include contact information for a human whom the employee may contact for more information about the employment decision. Employers would be prohibited from retaliating against an employee for exercising their rights under the law. Violations of the law would carry a civil penalty of $500, and the employer could be subject to a civil action or administrative enforcement by the Labor Commissioner. If enacted, SB 947 would become operative on July 1, 2027.

Notably, last year Governor Newsom vetoed SB 7, a prior version of the “No Robo Bosses Act” on grounds that it would have placed overly broad restrictions on employers’ use of ADS tools and because forthcoming California Privacy Protection Agency regulations will cover ADS.

SB 951 (Amendments to Cal/WARN)

SB 951 would amend the California Worker Adjustment and Retraining Act (“Cal/WARN”) to impose additional notice requirements when a mass layoff, relocation, or termination is caused in whole or substantial part by an AI system or other automated technology that replaces or automates jobs. In addition to the information already required in Cal/WARN layoff notices, the bill would require the layoff notice to state “This notice is for a technology displacement” at the top and identify: (1) the number, classification, or occupation, and work location of layoffs substantially due to the technology displacement; (2) the job functions performed by the replaced workers that will be automated; and (3) the specific category or type of AI system or other automated technology that substantially resulted in the displacement. The bill would also require the Employment Development Department to publish summaries of these notices and quarterly statewide summaries of reported technological displacement. If enacted, SB 951 would become operative on January 1, 2027.

AB 1883 (Workplace Surveillance Tools)

AB 1883 would restrict how employers use workplace surveillance tools, defined to include any system “that collects or facilitates the collection of employee data, activities, communications, actions, biometrics, or behaviors by means other than direct observation by a person, including, but not limited to, video or audio surveillance, continuous incremental time-tracking tools, geolocation, electromagnetic tracking, photoelectronic tracking, or that utilizes a photo-optical system or other means.” The bill would prohibit an employer from using a workplace surveillance tool to (1) recognize or make inferences or predictions about an individual’s emotional state or (2) collect neural data. The bill provides an exemption for use of a workplace surveillance tool for safety purposes, provided the tool does not use AI to perform the prohibited functions, and exempts certain uses reasonably necessary to comply with federal law or binding federal contracts relating to development of products or services for certain national security, military, space, or defense purposes. Violations would carry a civil penalty of up to $500, and the employer could be subject to a civil action or administrative enforcement by the Labor Commissioner. If enacted, AB 1883 would become operative on January 1, 2027.

We will keep you posted on the status of these bills and other AI developments.

Photo of Lindsey Tonsager Lindsey Tonsager

Lindsey Tonsager helps national and multinational clients in a broad range of industries anticipate and effectively evaluate legal and reputational risks under federal and state data privacy and communications laws.

In addition to assisting clients engage strategically with the Federal Trade Commission, the…

Lindsey Tonsager helps national and multinational clients in a broad range of industries anticipate and effectively evaluate legal and reputational risks under federal and state data privacy and communications laws.

In addition to assisting clients engage strategically with the Federal Trade Commission, the U.S. Congress, and other federal and state regulators on a proactive basis, she has experience helping clients respond to informal investigations and enforcement actions, including by self-regulatory bodies such as the Digital Advertising Alliance and Children’s Advertising Review Unit.

Ms. Tonsager’s practice focuses on helping clients launch new products and services that implicate the laws governing the use of endorsements and testimonials in advertising and social media, the collection of personal information from children and students online, behavioral advertising, e-mail marketing, artificial intelligence the processing of “big data” in the Internet of Things, spectrum policy, online accessibility, compulsory copyright licensing, telecommunications and new technologies.

Ms. Tonsager also conducts privacy and data security diligence in complex corporate transactions and negotiates agreements with third-party service providers to ensure that robust protections are in place to avoid unauthorized access, use, or disclosure of customer data and other types of confidential information. She regularly assists clients in developing clear privacy disclosures and policies―including website and mobile app disclosures, terms of use, and internal social media and privacy-by-design programs.

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Photo of Carolyn Rashby Carolyn Rashby

Carolyn Rashby provides business-focused advice and counsel to companies navigating the constantly evolving and overlapping maze of federal, state, and local employment requirements. She conducts workplace investigations and cultural assessments, leads audits regarding employee classification, wage and hour, and I-9 compliance, advises on…

Carolyn Rashby provides business-focused advice and counsel to companies navigating the constantly evolving and overlapping maze of federal, state, and local employment requirements. She conducts workplace investigations and cultural assessments, leads audits regarding employee classification, wage and hour, and I-9 compliance, advises on employment issues arising in corporate transactions, and provides strategic counsel to clients on a wide range of workplace matters, including harassment and #MeToo issues, wage and hour, worker classification, employee accommodations, termination decisions, employment agreements, trade secrets, restrictive covenants, employee handbooks, and personnel policies. Her approach is preventive, while recognizing the need to set clients up for the best possible defense should disputes arise.

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Photo of Bryan Ramirez Bryan Ramirez

Bryan Ramirez is an associate in the firm’s San Francisco office and is a member of the Data Privacy and Cybersecurity Practice Group. He advises clients on a range of regulatory and compliance issues, including compliance with state privacy laws. Bryan also maintains…

Bryan Ramirez is an associate in the firm’s San Francisco office and is a member of the Data Privacy and Cybersecurity Practice Group. He advises clients on a range of regulatory and compliance issues, including compliance with state privacy laws. Bryan also maintains an active pro bono practice.

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  • Posted in:
    Privacy & Data Security
  • Blog:
    Inside Privacy
  • Organization:
    Covington & Burling LLP
  • Article: View Original Source

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