California is imposing new limits on how employers can use AI to manage workers, including barring companies from relying solely on automated systems when deciding to discipline or fire employees.
Gov. Gavin Newsom signed a package of AI-related legislation covering workplace decisions, employee surveillance, health care and AI-generated content. The measures add to a growing set of California rules governing how businesses deploy AI.
Under Senate Bill 947, employers cannot rely exclusively on an automated decision system to make disciplinary or termination decisions. The measure is designed to preserve human oversight as companies increasingly use AI and other automated tools in hiring and workforce management.
Another measure, Senate Bill 951, adds AI and automation disclosures to California’s rules governing mass layoffs, relocations and terminations. Employers will be required to disclose when such an action is caused by an AI system or other automation technology.
The package also puts new restrictions on workplace surveillance. Assembly Bill 1331 prohibits employers from using workplace surveillance tools in bathrooms, while Assembly Bill 1883 establishes additional limits on employee monitoring technologies.
California also moved to preserve human decision-making in health care. The new laws protect doctors’ and other licensed providers’ ability to exercise independent professional judgment when AI or clinical decision tools are used and require developers of clinical decision tools to take reasonable steps to address known or foreseeable bias.
Other measures strengthen California’s AI transparency requirements, including protections for digital watermarks and provenance information intended to help people determine whether material was generated by AI. The state also enacted measures addressing digital replicas and AI-enabled impersonation.
The new laws expand an AI regulatory framework that already includes requirements for frontier AI developers and independent AI auditing. Iin September, Newsom signed legislation establishing standards for independent verification organizations and a state registry for AI auditors.