2025 Key Statutory Developments
Business
Expanded Automatic Renewal Law
The 2024 legislative cycle expanded a key consumer protection for auto renewals and established new requirements on subscription-based businesses.
California Expands Automatic Renewal Law, Imposing New Requirements for Subscription-Based Businesses
California Gov. Gavin Newsom signed AB 2863 into law, imposing new cancellation and consumer consent requirements for subscription-based businesses, including for a new category of “free-to-pay conversions.” It also expands businesses’ liability for marketing misrepresentations beyond the subscription service itself to the underlying good or service, creating litigation risks for businesses, as well as for third-party marketers of goods or services they don’t own or control. AB 2863 does not going effect until July 1, 2025.
Criminal
Minor Restitution Fines and Retail Theft
In 2024, the California Legislature continued to focus on rehabilitating minors by eliminating restitution fines. It also cracked down on retail theft with increased sentencing.
Gov. Gavin Newsom Signs ‘Smash-and-Grab’ Bill AB 1960 to Crack Down on Retail Theft
Under AB 1960, courts will be required to impose an enhanced sentence when “suspects take, damage, or destroy property valued at over $50,000.” The bill also reinstates a tiered system of penalty enhancements. Under the bill, if the loss or property value is over $50,000, the court will impose an additional term of one year; any loss or property value exceeding $200,000 will trigger an additional term of two years; and so on.
Gov. Newsom Signs AB 1186 to Eliminate Restitution Fines for California Minors
California Gov. Gavin Newsom signed into law Assembly Bill 1186, which eliminates restitution fines for minors adjudged to be a ward of the court, clarifies the amount of restitution owed by a minor in cases of stolen or damaged property, and provides that for the purpose of restitution, minors are severally liable, and not jointly and severally liable, as co-offenders.
Employment
“Captive audience” meetings and PAGA reform
The 2024 legislative session brought some important employment law changes — employees cannot be punished for refusing to attend or participate in certain meetings and some long-awaited PAGA reforms were implemented.
California Enacts Long-Awaited PAGA Reform: What’s in SB 92
SB92 amends Labor Code Section 2699.5, as well as amends, repeals, and adds Section 2699.3 of the Labor Code. Section 2 of the bill adds Section 2699.3 to the Labor Code effective October 1, 2024. It contains the following changes in one of the PAGA statutes: A civil action by an aggrieved employee can commence only after the following requirements are met: (1) The aggrieved employee or representative gives written notice by online filing with the Labor and Workforce Development Agency and by certified mail to the employer of the specific provisions of the Labor Code alleged to have been violated, including the facts and theories to support the alleged violation. (2) A notice filed with the Labor and Workforce Development Agency and any employer response to that notice must be accompanied by a filing fee $75, which is paid to the LWD Fund and used for specified purposes.
California Enacts Long-Awaited PAGA Reform: What’s in AB 2288
AB2288 amends Section 2699 of the Labor Code, and took effect June 19, 2024. Section 1 of the bill contains the following changes in one of the PAGA statutes: A civil action may be brought by an aggrieved employee on behalf of the employee and other current or former employees, so long as they suffered the same violation of the Labor Code (“against whom a violation of the same provision was committed”). The definition of “aggrieved employee” was changed to require that the employee “personally suffered each of the violation alleged during the period prescribed pursuant to Code of Civil Procedure section 340.
New California Law Takes Aim at ‘Captive Audience’ Meetings for Employees
California employees will enjoy new protections against so-called “captive audience” meetings. Senate Bill 399 enacts the California Worker Freedom from Employer Intimidation Act, which becomes effective January 1, 2025, and will be codified at Labor Code section 1137.
Real Property
ADUs, Commercial Tenants, and Residential Landlord Reporting Duties
This year, the legislature expanded permitting amnesty to certain unpermitted ADUs, implemented commercial tenant protections, and created new reporting requirements for residential landlords.
New Obligations for California Fiduciaries Under AB 2747
AB 2747, which may impose a duty on landlords to report positive rental payment information to at least one nationwide consumer reporting agency. Assembly Bill 2747 adds Civil Code section 1954.07 effective January 1, 2025. It requires landlords to offer to report their tenants’ positive rental payments to at least one consumer reporting agency.
The Commercial Tenant Protection Act (SB 1103): Bringing Residential Protections to Commercial Tenancies?
SB 1103 creates new protections for certain commercial tenants, and is set to take effect on Jan. 1, 2025. While the state has been embroiled in attempting to mitigate and solve the residential housing crisis by reforming residential tenancy regulations, this is the first major change to commercial tenancy regulations in quite some time. The bill adds three significant protections for qualifying commercial tenants.
California’s AB 2533 Expands Permitting Amnesty to Unpermitted ADUs Constructed Before Jan. 1, 2020
Assembly Bill 2533 has widened the pathway for California owners of unpermitted accessory dwelling units (ADUs) or junior accessory dwelling units (JADUs) to legalize their units. The bill does not create any new law within the state ADU law, but rather expands the class of property to which existing provisions apply – unpermitted or informal (sometimes referred to as “illegal”) ADUs and JADUs constructed before January 1, 2020 – and makes important clarifications to assist property owners in legalizing their units.
Trust & Estate
New Fiduciaries and Small Estate Asset Limits
This year, the legislature created fiduciary duties for residential landlords and expanded the small estate asset limit.
AB 2016 Proposes to Expand California’s Small Estate Asset Limit to Just Shy of $1 Million
Starting in mid-2025, AB 2016 will raise the state’s threshold amount for a “small estate” to just under $1 million — and could lead to more laypersons foregoing the assistance of attorneys during the Probate Code section 13151 petition process.
New Obligations for California Fiduciaries Under AB 2747
AB 2747, which may impose a duty on landlords to report positive rental payment information to at least one nationwide consumer reporting agency. Assembly Bill 2747 adds Civil Code section 1954.07 effective January 1, 2025. It requires landlords to offer to report their tenants’ positive rental payments to at least one consumer reporting agency.
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