HR Updates

What’s changing in CA, OR & WA

Employment law in these three states moves every year, and most of it lands on January 1 — except Oregon’s minimum wage, which moves on July 1. Here is what is coming, in plain language.

Last reviewed October 22, 2026

California — effective January 1, 2027 unless noted

  • Minimum wage & exempt salary. The statewide minimum wage rises to $17.40/hour and the exempt salary floor to $72,384/year. Many city and county ordinances are higher — the local rate wins.
  • AI and layoffs (SB 951). Cal-WARN notices must now disclose when automation or AI is a substantial cause of a layoff, including how many positions are affected, which job functions are being automated, and what type of technology is involved.
  • Limits on AI surveillance (AB 1883). Employers may not use monitoring tools that recognize, infer or predict an employee's emotional state, or that collect neural data.
  • Bereavement leave (SB 1149). Extends bereavement leave to cover the death of an employee's “designated person,” not only a close family member.
  • Arbitration agreements (AB 2155). An arbitration agreement that would be unenforceable under the Federal Arbitration Act is now also unenforceable under California law.
  • Immigration-related retaliation (AB 2495). Expands protections against immigration-related retaliation, with civil penalties up to $10,000 per violation, per person affected.
  • Definition of “sex discrimination” (AB 2563). Creates one uniform statewide definition across California law.
  • Stay-or-pay agreements (AB 1697). Restrictions on agreements that require repayment if an employee leaves take effect January 1, 2027.
  • Pay data reports (SB 1237). The penalty for repeatedly failing to file required pay data reports rises from $250 to $1,000 per employee.
  • Coming later. SB 947 takes effect July 1, 2027, and AB 1803 on January 1, 2028.
Questions We Get Most

The ones that come up again and again

Short, practical answers. If yours is not here, ask — it probably belongs on this page.

I have one employee working remotely in another state. Whose law applies?

Generally the law where the employee actually performs the work — not where your company is based. Wage and hour rules, paid leave, required notices and posting requirements usually follow the employee. One out-of-state hire can quietly make you a multi-state employer.

Do I have to pay out unused PTO when someone leaves?

In California, accrued vacation and PTO are earned wages: they must be paid out at separation, and “use it or lose it” policies are not allowed. In Oregon and Washington, payout generally depends on what your written policy or agreement promises — which is exactly why the wording of that policy matters so much.

How quickly is a final paycheck due?

It differs by state, and by whether the person quit or was let go. California is the strictest — final pay is generally due immediately on termination. Oregon and Washington allow more time, but the deadlines are still short and the penalties for missing them are real. Check the rule for the specific state and separation type before the last day, not after.

Do we have to put a salary range in our job postings?

All three states have pay transparency requirements, with different triggers and details. Washington’s is the one to watch in 2027: the employer right to cure a non-compliant posting sunsets on July 27, 2027.

Are noncompete agreements enforceable?

Practically speaking, plan without them in all three states. California voids them with narrow exceptions. Oregon allows them only within strict notice and salary limits. Washington bans them outright as of June 30, 2027, for employees and independent contractors alike. Confidentiality, trade secret and non-solicitation protections are the realistic tools.

Do I have to provide paid sick leave?

Yes — California, Oregon and Washington all mandate it. Accrual rates, caps, carryover and permitted uses differ by state, and some cities add their own rules on top.

When do we need harassment prevention training?

California requires it once you reach 5 employees, for both supervisors and staff, repeated every two years. Oregon and Washington approach it through written policy and complaint-handling requirements rather than an identical training mandate.

My salaried manager earns $70,000 — are they exempt from overtime?

Possibly not. State salary floors can exceed the federal one and are rising: a Washington employer with 51+ employees needs $92,196 in 2027, and California’s floor is $72,384. Salary is also only half the test — the person’s actual duties have to qualify. A job title never settles it.

Do I need a written employee handbook?

It is rarely required outright, but it is how you show a policy existed, was communicated and was applied consistently. If you employ people in more than one of these states, a single generic handbook usually is not enough — state-specific addenda are the cleaner approach.

An employee just complained about a coworker. What do I do first?

Act promptly, write things down, and do not promise confidentiality you cannot deliver. Decide who is impartial enough to look into it before anyone starts asking questions, and keep the complaining employee protected from retaliation while it is pending. The most expensive mistakes usually come from delay, not from the original incident.

Before you rely on this

This page is general information, not legal advice, and it is no substitute for guidance on your specific situation. Employment law changes often, and city or county rules may add requirements on top of the state ones listed here. Confirm against the official source before you act:

California Department of Industrial Relations · Oregon BOLI · Washington L&I

Not sure how a change applies to your team? That is a good reason to talk.

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