Severance Agreement: When Not to Sign & How to Protect Your Rights

California has wrapped up another busy legislative session, and Governor Gavin Newsom has approved a wide range of new workplace laws that employers will need to prepare for in 2026 and beyond. These measures touch nearly every corner of employment compliance, from labor rights and pay transparency to leave rules, recordkeeping, and restrictions on certain contract terms. Below are a few key changes that stand out. 1. Expanded Labor Rights for Workers and Gig Drivers A new law (AB 288) strengthens workers’ rights to organize and gives the Public Employment Relations Board the power to step in when federal labor protections fall short. Another measure (AB 1340) creates a framework allowing certain gig-economy drivers to unionize and negotiate industry-wide standards without changing their independent contractor status. 2. Broader Pay Data and Equal Pay Requirements Under SB 464, employers with 100 or more workers will face stricter pay-data reporting rules, including penalties for failing to file and expanded job-category reporting starting in 2027. SB 642 also updates California’s Equal Pay Act by clarifying what counts as wages, including bonuses, equity, and benefits, and setting a six-year limit for filing claims. 3. New Limits on Repayment Agreements AB 692 restricts employers from requiring workers to repay training costs or other debts when they leave a job, unless very specific exceptions apply (such as accredited programs or prorated hiring bonuses). Most repayment-based contract terms tied to separation will no longer be allowed. Read more in the National Law Review, HERE .