EMPLOYMENT LAW NEWS
Legislative Scoop: Key Employment Law Updates from California about Artificial Intelligence
By Grant Larson, Compliance Paralegal
Employment Law and Compliance
Published September 8, 2026
This month’s Legislative Scoop reviews three California bills addressing AI in the workplace, covering employee monitoring, automated decision making, and job displacement, now on Governor Newsom’s desk.
Each month, GovDocs’ Employment Law and Compliance Team provides the scoop on key bills making their way through the legislative process. This month, we are looking at bills in California that are sitting on Governor Newsom’s desk relating to the use of artificial intelligence (AI) in the workplace. All of these bills were passed at the end of the California legislative session at the end of August, and he has until the end of September to decide on them.
Key Takeaways
✓ Three California AI bills reached Governor Newsom’s desk: AB 1883 (workplace surveillance), SB 947 (automated decision systems) and SB 951 (technological displacement). AB 1883 was signed Sep. 3, 2026; the other two await action by the Sep. 30 deadline.
✓ AB 1883 is now law, effective Jan. 1, 2027: employers may not use AI to monitor an employee’s emotional state or to collect “neural data” measuring the central or peripheral nervous system, adding privacy obligations to performance-tracking tools already in place.
✓ SB 947 would restrict automated decision systems: employers could not use them to determine protected-class membership, avoid labor-law compliance, or take adverse action against workers exercising their rights and could not rely solely on AI for discipline or termination, which would require written notice that a human reviewed the decision. Effective July 1, 2027 if enacted.
✓ SB 951 would extend the California WARN Act: advance notice would be required before laying off 50 or more workers at an establishment that employed at least 75 people in the past 12 months when the layoffs result from AI or other automation, with the EDD publishing a quarterly public summary.
AB 1883 – Workplace Surveillance Tools
The first bill that will be highlighted in this month’s review is AB 1883, which is an amendment to Section 1580 located in Part 5.8 of the California Labor Code. It was signed into law on Sep. 3, 2026, and will take effect on Jan.1, 2027. This bill forbids employers from using AI to monitor an employee’s emotional state and information generated to measure the peripheral or central nervous system. In the bill’s text, that is referred to as “neural data.” If enacted, this bill will increase worker rights and require privacy protection from employers for tools they might already have in place to track employees’ performance.
SB 947 – Automated Decision Systems
Senate Bill 947 is another bill that employers should monitor in the next month to see if it will be enacted, or if Governor Newsom will veto this bill, like he previously did last year with SB 7. This bill would prevent employers from using an “automated decision system” to make decisions about whether an employee is a member of a protected class, prevent compliance with labor laws or regulations, or predict and take adverse action against workers exercising their legal rights.
The most important, and perhaps most impactful, part of the bill comes in the next section, prohibiting the sole use of machine learning and AI to make decisions about discipline and termination. Any employer who does use AI when making a termination decision will be required to also give the affected employee a notice stating that the decision was manually reviewed by a human. If enacted, this bill will go into effect on July 1, 2027.
SB 951 – Technological Displacement
The final bill pending with Governor Newsom is SB 951, regarding worker protections from mass layoffs. This bill requires an employer to give workers advance notice before laying off 50 or more workers at an establishment that employed at least 75 people in the last 12 months, if the layoffs result from the work being automated by AI or another automation tool. For employers who are unsure of what this bill would look like in practice, it would be an extension of the currently established California WARN Act, by having additional requirements for AI-related mass layoffs.
The rest of the bill covers requirements for the California Employment Development Department, and how they post information when they receive notice that mass layoffs happen due to AI or other automated technologies. For employers to note, this information will be made publicly available as part of a quarterly summary the Department produces.
Conclusion
Two of the bills referenced above have cleared the California Legislature but are not yet law, and Governor Newsom could still sign, veto, or allow any of them to become law without his signature by the Sep. 30 deadline. He already signed AB 1883 into law on Sep. 3. As such, employers should keep an eye on California to watch for any new AI-related requirements in the event these bills are enacted, particularly given the short runway many of these provisions provide before their effective dates.
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This Employment Law News blog is intended for market awareness only, it is not to be used for legal advice or counsel.
