Backstrom Labor Law is encouraging California business owners and HR leaders to review pay practices, employment agreements and handbooks before several state employment law changes take effect in 2027.
The firm is led by Karin Backstrom, an employer defense attorney in San Diego with more than 30 years of experience representing California businesses. According to the firm, most of these changes can be handled with a careful review this fall, while gaps that go unnoticed often surface only after a claim has been filed.
Key Changes for California Employers
The statewide minimum wage will rise to $17.40 per hour on January 1, 2027, under Labor Code section 1182.12. Because employees classified as exempt under the executive, administrative, and professional exemptions must earn at least twice the state minimum wage for full-time work, their minimum salary will rise to $72,384 per year.
Some cities and counties also set higher local rates, and employers must pay the highest rate that applies. Be careful to also comply with your local minimum wage. Minimum wage for the City of San Diego rises to $18.35 per hour as of January 1, 2027.
Backstrom Labor Law notes that the exempt salary change is easy to overlook. If a salaried manager falls below the new amount, that employee may no longer qualify as exempt and overtime rules can apply. When pay errors repeat across a workforce, they can lead to class actions and claims under the Private Attorneys General Act. Karin Backstrom also serves as a PAGA defense attorney for California employers who receive those notices.
Other changes include AB 1697, signed on September 30, 2026, which applies California’s stay or pay restrictions to contracts entered into on or after January 1, 2027, and SB 1149, which expands bereavement leave for employers with five or more employees to include a designated person starting the same day.
SB 947, the No Robo Bosses Act, becomes operative on July 1, 2027, and will require a human reviewer to corroborate the decision when an employer primarily relies on an automated system to discipline or terminate an employee. Beginning January 1, 2028, AB 1803 will add an anti-hate speech component to the harassment prevention training already required for employers with five or more employees.
Four Steps to Take Now
- Check hourly pay rates against state and local minimums, and confirm that executive, administrative, and professional exempt employees will earn at least $72,384 in 2027.
- Update sign-on bonus, training repayment, and similar agreement templates before new ones are signed in 2027.
- Update the employee handbook, including the bereavement leave policy.
- List any software that scores or flags employees and plan a human review step before July 1, 2027.
Many of the firm’s clients use ongoing HR counsel for this kind of annual review. When a problem does surface, it may begin with a claim or complaint filed with a government agency, and the firm’s DLSE and CRD complaint defense work begins with that first response.
About Backstrom Labor Law
Backstrom Labor Law is a San Diego employment law firm that represents California employers exclusively, providing HR advice and defending employers in state and federal courts and before agencies including the EEOC, DLSE, and the California Civil Rights Department.
Attorney Karin Backstrom began her career at Littler Mendelson and Sheppard Mullin, has handled more than 1,000 employment cases, and teaches courses for the Human Resources Certification Institute.
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Contact
Backstrom Labor Law
Karin Backstrom
3990 Old Town Ave, Building C, Suite 107, San Diego, CA 92110
(619) 851-7274
karin@backstromlaborlaw.com
https://backstromlaborlaw.com/
Facebook: https://www.facebook.com/karin.backstrom.2025/
LinkedIn: https://www.linkedin.com/in/karin-backstrom-563932b/
Disclaimer: This release is provided for general informational purposes only and does not constitute legal advice or create an attorney-client relationship. Employment laws, regulations, compliance requirements, and their application may vary based on an employer's circumstances and may change. Employers should consult qualified legal counsel regarding their specific obligations.
Source: 38 Digital Market News
Release ID: 2714326
