Essential Guide for Employers:Understanding California’s Anti-Discrimination Laws

Posted on August 4, 2025

California leads the nation in protecting workers from discrimination and harassment. The state’s comprehensive anti-discrimination laws create opportunities and obligations for employers across all industries.

Understanding these laws isn’t just about legal compliance—building stronger, more inclusive workplaces that attract top talent and reduce costly litigation risks. This guide provides practical insights into California’s anti-discrimination framework, helping you navigate complex requirements while protecting your business and employees.

The Civil Rights Department: Your Compliance Partner

The California Civil Rights Department (CRD) is the primary enforcement agency for the state’s anti-discrimination laws. This department investigates complaints, enforces violations, and provides guidance to help employers maintain compliant workplaces.

Unlike federal agencies that may take months to respond, the CRD acts swiftly on discrimination complaints. The department has broad investigative powers, including the authority to conduct on-site investigations, issue subpoenas, and take testimony under oath. For employers, this means having robust policies and procedures before problems arise.

The CRD doesn’t represent individual complainants but acts as an objective factfinder. When violations are found, the department can pursue litigation against employers, seeking remedies that include back pay, reinstatement, policy changes, and punitive damages.

Protected Characteristics Under California Law

California’s Fair Employment and Housing Act (FEHA) protects employees from discrimination based on numerous characteristics. Recent expansions have broadened these protections significantly.

Core Protected Categories

The law prohibits discrimination based on:

• Race and Color: Including discrimination based on hair texture, protective hairstyles, and racial characteristics
• Ancestry and National Origin: Covering language use, accent, and immigration status
• Religion and Creed: Requiring reasonable accommodation for religious practices
• Age: Protecting workers 40 and older from age-based discrimination
• Disability: Covering both physical and mental disabilities, including temporary conditions
• Sex and Gender: Including pregnancy, childbirth, breastfeeding, and related conditions
• Sexual Orientation: Protecting LGBTQ+ employees from discrimination
• Gender Identity and Expression: Covering transgender and non-binary individuals
• Medical Condition: Protecting employees with cancer, genetic characteristics, or other medical conditions
• Genetic Information: Prohibiting discrimination based on genetic testing or family medical history
• Marital Status: Protecting both married and unmarried employees
• Military and Veteran Status: Covering active duty, reserve, and veteran employees

Recent Expansions

Recent amendments to FEHA have expanded protections in several key areas. The definition of “sex” now explicitly includes gender identity and gender expression. Religious creed protections have been strengthened to include religious dress and grooming practices. Additionally, the law now provides enhanced protections for employees who use medical marijuana with valid prescriptions. These recent changes highlight the importance of staying current with California regulations and implementing effective HR policies.

Key Compliance Steps

1. Conduct regular audits to identify any compliance gaps or risks.
2. Stay informed of updates and changes to labor laws in California.
3. Develop and implement clear HR policies that align with state regulations.
4. Train employees on anti-discrimination and harassment policies.
5. Review and update contractor agreements to ensure compliance.

Additional Resources

• Interactive tools for self-audits and policy development
• Webinars on current regulatory changes and best practices
• Comprehensive checklists for various compliance areas
• Access to expert guidance from our team of experienced HR professionals

Illegal Discriminatory Practices in Employment

California law prohibits discrimination in all aspects of employment, from initial job postings through termination and beyond.

Hiring and Recruitment

Discrimination can occur before an employment relationship even begins. Job advertisements cannot contain language that discourages applications from protected groups. Interview questions must focus on job-related qualifications rather than personal characteristics.

Case Example: In Smith v. Acme Corp, a manufacturing company consistently promoted less-qualified white employees over equally or more qualified Black employees. The CRD investigation revealed that promotion decisions were based on “cultural fit” assessments that disproportionately favored white employees. The company was required to pay $150,000 in back wages and implement new promotion criteria based solely on objective job performance measures.

Case Example: In Garcia v. Tech Solutions Inc., a Latino employee was denied overtime pay and promotions due to workplace policies that disproportionately affected employees with strong accents. The CRD ruled that this constituted national origin discrimination. Tech Solutions Inc. was mandated to provide $200,000 in damages and overhaul its internal policies to ensure equitable treatment, including diversity training for managers.

Case Example: Chen v. Prime Realty Partners involved a female real estate agent who was consistently assigned fewer high-value clients compared to her male counterparts, despite equal or superior sales performance records. This practice was found to be a violation of sex discrimination laws. The company was ordered to compensate the employee with $250,000 for lost commissions and modify its client assignment practices to prioritize objective performance metrics.

Workplace Conditions and Compensation

Once hired, employees must receive equal treatment in all terms and conditions of employment. This includes compensation, benefits, work assignments, training opportunities, and performance evaluations.

Pay equity laws require equal pay for substantially similar work, regardless of protected characteristics. Employers must be able to justify any pay differences based on legitimate business factors such as education, experience, or performance. It is essential to regularly review and update compensation policies to ensure compliance with all applicable laws.

In addition, employers must provide reasonable accommodations for employees with disabilities, as required by the Americans with Disabilities Act (ADA). This includes making changes in the workplace or job duties that enable qualified individuals with disabilities to perform the essential functions of their jobs. Employers cannot discriminate against individuals based on their disability status and must interact with employees who request accommodations.

Employers are also responsible for providing safe working conditions. This includes compliance with Occupational Safety and Health Administration (OSHA) standards and promptly addressing any hazards or safety concerns. Employers should conduct regular safety training and inspections to promote

Termination and Discipline

Employment decisions must be based on legitimate business reasons, not protected characteristics. Employers should document performance issues and follow consistent disciplinary procedures for all employees. Any termination decisions should be carefully reviewed to ensure they are not discriminatory. If an employee is terminated, the employer must provide final paychecks in a timely manner and follow state-specific regulations for any accrued vacation or sick time.

 Case Example: Brown v. Gamma LLC involved an employee with a mobility disability who requested a modified work schedule as a reasonable accommodation. When the employer denied the request without engaging in the interactive process, then terminated the employee for “attendance issues,” the CRD found disability discrimination. The settlement included $75,000 in damages and mandatory training for all managers on disability accommodation requirements. 

To ensure your business doesn’t face similar legal consequences, our HR compliance solutions offer expert guidance on reasonable accommodations and the interactive process. We also provide training for managers to help them effectively handle accommodation requests.

Regulatory Updates: Stay informed and compliant with our regular updates on California labor laws. Our compliance alerts cover changes in wage and hour regulations, leave laws, harassment policies, safety compliance, and more. Don’t miss out on crucial updates – subscribe to our newsletter today.

Attention Hooks: Are you tired of struggling to keep up with California’s ever-changing labor laws? Let us simplify HR for you. Our tailored solutions offer step-by-step guidance to ensure your business stays compliant without added.

Understanding Harassment Prevention Requirements

California requires most employers to provide sexual harassment prevention training, but comprehensive harassment prevention goes beyond legal minimums.

Training Requirements

Employers with five or more employees must provide:

• Two hours of harassment prevention training for supervisors
• One hour of training for non-supervisory employees
• Training must be provided within six months of hire and every two years thereafter

Recent Updates to Training Requirements

The 2024 updates to harassment prevention training requirements now mandate coverage of:

Harassment based on gender identity and expression

• Bystander intervention techniques
• Reporting procedures for remote work environments
• Abusive conduct that may not rise to the level of harassment but creates a hostile work environment

Case Examples:

Jones v. Beta Inc. highlighted the importance of robust harassment prevention. Despite having policies in place, the company failed to investigate reports of sexual harassment promptly. The investigation revealed that supervisors were not properly trained on reporting procedures. The settlement included $200,000 in damages and required implementation of a comprehensive harassment prevention program with quarterly training updates.

Smith v. Gamma Corp.: An employee sued their company for creating a hostile work environment due to repeated sexual advances from a coworker. The company had no policies to address and prevent such behavior, resulting in a costly settlement.

Rodriguez v. Delta Enterprises: A group of female employees filed a lawsuit against their employer for failing to address multiple instances of sexual harassment by a high-ranking manager. The lack of proper training and enforcement of anti-harassment policies resulted in significant company damage. 

These examples highlight how important it is for businesses to have comprehensive harassment prevention policies and procedures in place

Filing Complaints: What Employers Need to Know

Understanding the complaint process helps employers respond appropriately when issues arise.

The Complaint Timeline

Employees have three years from the date of the alleged discrimination to file a complaint with the California Civil Rights Department CRD. This extended timeline means employers should thoroughly document employment decisions and workplace incidents.

The Investigation Process

When a complaint is filed, the CRD conducts a thorough investigation that may include:

• On-site interviews with employees and witnesses
• Review of personnel files and company policies
• Analysis of workplace practices and procedures
• Collection of relevant documents and communications

Employers should cooperate fully with CRD investigations while protecting legitimate business interests and employee privacy.

Dual-Filing with Federal Agencies

Complaints filed with the California Civil Rights Department CRD are automatically cross-filed with the Equal Employment Opportunity Commission (EEOC) when they involve federal law violations. This dual-filing system means employers may face both state and federal scrutiny for the same incident.

Available Remedies and Penalties

California provides extensive remedies for discrimination victims, creating significant financial risks for non-compliant employers.

Monetary Remedies

Successful discrimination claims can result in:

• Back Pay: Compensation for lost wages and benefits
• Front Pay: Future earnings when reinstatement isn’t feasible
• Emotional Distress Damages: Compensation for psychological harm
• Punitive Damages: Additional penalties for egregious conduct
• Attorney’s Fees and Costs: Often exceeding the underlying damages

Non-Monetary Remedies

Courts and the CRD can order:

• Employee reinstatement or promotion
• Policy changes and implementation
• Management training programs
• Workplace monitoring and reporting requirements
• Public disclosure of violations

Recent CRD Settlements

Analysis of recent CRD settlements reveals common violations and their consequences:

• A restaurant chain paid $1.2 million for systemic sexual harassment, including mandatory training for all locations
• A construction company paid $800,000 for disability discrimination, plus implementation of new accommodation procedures
• A retail chain paid $500,000 for pregnancy discrimination, including policy revisions and manager training
• A tech company paid $2 million for race discrimination, including a settlement fund for affected employees and diversity training for all staff
• A manufacturing company paid $1.5 million for wage violations, including back pay and penalties

These examples demonstrate the serious consequences of non-compliance with labor laws in California. As a small business, it is crucial to understand and adhere to these regulations to avoid costly penalties and negative impact on your reputation.

To help businesses navigate these complex laws, our solutions offer tailored guidance and tools specifically designed for compliance in California. Our expert team stays updated on the latest changes in labor laws, ensuring you have accurate information at all times. We also provide regular audits and updates to HR policies, reducing the risk of potential violations.

In addition to mitigating risks, staying compliant

These examples demonstrate the importance of proactive compliance measures and the potential consequences of failing to comply with labor laws. As a small business in California, it is crucial to stay informed and take steps towards ensuring legal adherence.

FEHA and Disability Accommodations

California’s disability accommodation requirements often exceed federal standards, creating additional compliance obligations.

The Interactive Process

When an employee requests accommodation, employers must engage in a good-faith interactive process to identify adequate accommodations. This process must be:

• Timely and responsive
• Conducted in good faith
• Focused on identifying effective accommodations
• Documented throughout

New CRD Guidelines on Disability Accommodations

Recent CRD guidance emphasizes several key areas:

• Remote Work: Employers must consider telecommuting as a reasonable accommodation
• Mental Health: Accommodations for mental health conditions receive equal consideration
• Temporary Disabilities: Even short-term conditions may require accommodation
• Leave as Accommodation: Additional leave beyond FMLA/CFRA may be required

California Family Rights Act (CFRA) Developments

Recent expansions to CFRA have broadened family leave protections significantly.

Expanded Covered Relationships

CFRA now covers leave to care for:

• Grandparents and grandchildren
• Siblings
• Adult children
• Parents-in-law
• Any individual related by blood or whose association is equivalent to a family relationship

Integration with Other Leave Laws

CFRA leave often runs concurrently with other leave entitlements, but California law provides additional protections beyond federal requirements. Employers must track multiple leave entitlements and ensure employees receive maximum benefits under all applicable laws.

Pregnancy and Parental Leave Rights

California provides among the nation’s most comprehensive pregnancy and parental leave protections.

Pregnancy Disability Leave (PDL)

Employees with pregnancy-related disabilities can take up to four months of protected leave. Key features include:

• No minimum employment period required
• Leave can be taken intermittently
• Reasonable accommodations must be provided
• Job restoration guaranteed upon return

Bonding Leave

After pregnancy disability leave, eligible employees can take additional leave to bond with their new children. This leave is separate from and in addition to pregnancy disability leave.

Coordination with Paid Family Leave

California’s Paid Family Leave program provides partial wage replacement during bonding leave, making extended leave more financially feasible for employees.

EQHR Solutions – HR Compliance Guidance & Tools

Our solutions provide expert guidance and resources tailored specifically for small businesses in California. We understand the complexities of local labor laws and offer comprehensive support to help your business stay compliant.

Expertise Tailored to California Labor Laws

Our team of HR Advisors has extensive knowledge of California’s unique employment regulations and monitors any changes or updates. Contact us today – 855-461-8808