How to Hire a New Employee in California (2026)
Reviewed by DocDraft Legal Team · California · Last updated 2026-05-18
When a California employer adds a worker to payroll, the state's own wage and reporting rules kick in. In California, $16.90 per hour, effective January 1, 2026, for all employers not otherwise covered by a higher minimum wage specific to an industry or a locality. The federally-required new-hire report in California is filed with the report due within 20 days of hire date. Below are the California-specific filings, deadlines, and the statutes that govern workers' comp, E-Verify, and at-will employment.
Key Considerations
Before the first paycheck, a California employer has to know the wage floor that applies. $16.90 per hour, effective January 1, 2026, for all employers not otherwise covered by a higher minimum wage specific to an industry or a locality That floor sits.
New-hire reporting is the federally-mandated first administrative step. California requires the report Within 20 days of hire date On the unemployment side, the employer must also register for state UI tax
California treats workers' comp, E-Verify, and at-will employment as three separate compliance levers. Workers' comp: All employers (including those with one employee), except the state itself, must secure workers' compensation coverage; no statutory employee-count threshold under Cal. Labor Code section 3700 E-Verify: California does NOT require E-Verify for private employers; Cal. Labor Code Article 2.5 (sections 2810.40 et seq., enacted via AB 1236, 2011) prohibits state or local governments from mandating private-employer E-Verify use, except where federally required; AB 622 (2015) prohibits using E-Verify on applicants pre-offer or on existing employees except as federally required At-will: California is an at-will employment state under Cal. Labor Code section 2922. Recognized common-law exceptions: (1) public-policy exception (Tameny v. Atlantic Richfield Co., 27 Cal.3d 167 (1980)); (2) implied-contract exception (Foley v. Interactive Data Corp., 47 Cal.3d 654 (1988)); (3) implied covenant of good faith and fair dealing (limited to contract damages, Foley supra). Statutory limits: FEHA anti-discrimination, retaliation, whistleblower, and protected-activity provisions further restrict termination.
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Relevant Documents
In California the hire-side document stack runs from federal Form I-9 through Form W-4 (federal) and the California state withholding addendum (where applicable), then the California new-hire report (Within 20 days of hire date), then workers' compensation enrollment paperwork (All employers (including those with one employee), except the state itself, must secure workers' compensation coverage; no statutory employee-count threshold under Cal. Labor Code section 3700).
Employee Handbook
A comprehensive document outlining company policies, procedures, work rules, benefits, and expectations. Provides important information to new employees and serves as a reference for all staff.
Employment Application Form
A standardized form for collecting information from job applicants including work history, education, skills, and references. This helps employers make informed hiring decisions and serves as documentation of the hiring process.
Employment Contract
A comprehensive legal agreement between employer and employee detailing all terms and conditions of employment including duties, compensation, benefits, termination procedures, and confidentiality requirements.
Employment Offer Letter
A formal document outlining the terms of employment including position, salary, benefits, start date, and other conditions. This establishes clear expectations and serves as evidence of the employment agreement.
Non-Compete Agreement
A contract that restricts an employee from working for competitors or starting a competing business for a specified period after employment ends. Enforceability varies significantly by state.
Non-Disclosure Agreement
Protects your confidential information, trade secrets, and intellectual property that you may need to share with the manufacturer during the course of your relationship. This should be signed before detailed discussions begin.
Relevant Laws
California Fair Employment and Housing Act (FEHA)
FEHA prohibits employment discrimination based on protected characteristics including race, religion, color, national origin, ancestry, physical or mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, sexual orientation, and military/veteran status. Employers with 5 or more employees must comply with FEHA when hiring.
California Equal Pay Act
Requires employers to pay employees of different genders, races, and ethnicities equally for substantially similar work. When hiring, employers should ensure their compensation offers don't perpetuate pay disparities based on protected characteristics.
Ban-the-Box Law (Fair Chance Act)
Prohibits employers with 5 or more employees from asking about criminal history on job applications or inquiring about conviction history before making a conditional job offer. This law aims to reduce barriers to employment for people with criminal records.
California Salary History Ban
Employers cannot ask job applicants about their salary history, and cannot rely on salary history to determine whether to offer employment or what salary to offer. Employers must provide a pay scale for a position upon reasonable request.
E-Verify Requirements
While California prohibits localities from requiring private employers to use E-Verify, all employers must complete Form I-9 verification for new hires. California law also prohibits employers from using E-Verify to check existing employees or applicants before offering a job.
Mandatory Sexual Harassment Training
Employers with 5 or more employees must provide at least 1 hour of sexual harassment prevention training to all employees and 2 hours to supervisors within 6 months of hire or promotion, and every 2 years thereafter.
New Employee Documentation Requirements
Employers must provide new hires with specific documentation including a DE 2515 Disability Insurance Pamphlet, DE 2511 Paid Family Leave pamphlet, DE 2320 Unemployment Insurance pamphlet, and written notice of sick leave rights under the Healthy Workplaces, Healthy Families Act.
Wage Theft Prevention Act
Requires employers to provide new non-exempt employees with a written notice containing specific information about pay rates, pay day, employer information, and workers' compensation coverage at the time of hire.
Regional Variances
Bay Area
San Francisco has additional employer requirements including the Fair Chance Ordinance (limiting background checks and when criminal history can be considered), higher minimum wage ($18.07 as of July 2023), and the Health Care Security Ordinance requiring employers with 20+ employees to spend a minimum amount on employee healthcare.
Berkeley has its own minimum wage ordinance, paid sick leave requirements that may exceed state law, and specific fair workweek provisions for certain industries requiring advance notice of work schedules.
Oakland enforces its own minimum wage ($15.97 as of January 2023), paid sick leave ordinance (allowing employees to accrue 1 hour for every 30 hours worked), and has a Ban the Box ordinance restricting when employers can ask about criminal history.
Southern California
Los Angeles has a higher minimum wage ($16.78 for employers with 26+ employees), Fair Chance Initiative prohibiting employers from asking about criminal history until after a conditional offer, and specific paid sick leave requirements allowing employees to accrue 48 hours annually.
Santa Monica has its own minimum wage ordinance, hotel worker living wage requirements, and a local paid sick leave law that may provide more generous benefits than state requirements.
San Diego enforces the Earned Sick Leave and Minimum Wage Ordinance requiring employers to provide at least one hour of paid sick leave for every 30 hours worked with different accrual caps than state law.
Central Valley
Fresno generally follows state employment laws without significant additional local requirements, but has specific zoning restrictions that may affect home-based businesses and certain types of commercial operations.
Sacramento has a Worker Protection Ordinance that provides supplemental paid sick leave for COVID-related absences beyond state requirements and specific protections for hotel workers.
Suggested Compliance Checklist
Complete the state new-hire report
On hire days after startingCalifornia's Within 20 days of hire date
Open the unemployment-insurance employer account
Before first payroll days after startingThe California portal is
Collect federal Form W-4 and any California state-tax withholding addendum required by the state revenue agency
Before first hire days after startingThe federal Form W-4 is the floor; the state addendum (where the state has its own withholding regime) drives state income-tax deductions.
Handle Form I-9 employment verification at onboarding
On hire days after startingThe worker completes Section 1 by their first day; the employer verifies documents and signs Section 2 within 3 business days of hire.
Decide on workers' compensation coverage
On hire days after startingThe California rule: All employers (including those with one employee), except the state itself, must secure workers' compensation coverage; no statutory employee-count threshold under Cal. Labor Code section 3700
Determine whether E-Verify enrollment is required or optional in California
Before hire days after startingCalifornia does NOT require E-Verify for private employers; Cal. Labor Code Article 2.5 (sections 2810.40 et seq., enacted via AB 1236, 2011) prohibits state or local governments from mandating private-employer E-Verify use, except where federally required; AB 622 (2015) prohibits using E-Verify on applicants pre-offer or on existing employees except as federally required
Memorialize the at-will status in California employment documents
Before first hire days after startingCalifornia is an at-will employment state under Cal. Labor Code section 2922. Recognized common-law exceptions: (1) public-policy exception (Tameny v. Atlantic Richfield Co., 27 Cal.3d 167 (1980)); (2) implied-contract exception (Foley v. Interactive Data Corp., 47 Cal.3d 654 (1988)); (3) implied covenant of good faith and fair dealing (limited to contract damages, Foley supra). Statutory limits: FEHA anti-discrimination, retaliation, whistleblower, and protected-activity provisions further restrict termination.
Add the California-specific posters to the worksite display alongside the federal FLSA, OSHA, and EEO notices
Before hire days after startingCalifornia-specific required workplace postings include: 'California Workplace - Know Your Rights' (annual, effective February 1, 2026); IWC wage orders; state minimum wage; paid sick leave; payday notice; 'Safety and health protection on the job'; emergency phone numbers; access to medical and exposure records; 'Operating Rules for Industrial Trucks'; 'Notice to employees -- injuries caused by work'; notice of workers' compensation carrier and coverage; whistleblower protections; no-smoking signage; log and summary of occupational injuries and illnesses; 'Farm labor contractor statement of pay rates' (where applicable); prevailing wage rate determinations (public works)
| Task | Description | Document | Days after starting |
|---|---|---|---|
| Complete the state new-hire report | California's Within 20 days of hire date | - | On hire |
| Open the unemployment-insurance employer account | The California portal is | - | Before first payroll |
| Collect federal Form W-4 and any California state-tax withholding addendum required by the state revenue agency | The federal Form W-4 is the floor; the state addendum (where the state has its own withholding regime) drives state income-tax deductions. | - | Before first hire |
| Handle Form I-9 employment verification at onboarding | The worker completes Section 1 by their first day; the employer verifies documents and signs Section 2 within 3 business days of hire. | - | On hire |
| Decide on workers' compensation coverage | The California rule: All employers (including those with one employee), except the state itself, must secure workers' compensation coverage; no statutory employee-count threshold under Cal. Labor Code section 3700 | - | On hire |
| Determine whether E-Verify enrollment is required or optional in California | California does NOT require E-Verify for private employers; Cal. Labor Code Article 2.5 (sections 2810.40 et seq., enacted via AB 1236, 2011) prohibits state or local governments from mandating private-employer E-Verify use, except where federally required; AB 622 (2015) prohibits using E-Verify on applicants pre-offer or on existing employees except as federally required | - | Before hire |
| Memorialize the at-will status in California employment documents | California is an at-will employment state under Cal. Labor Code section 2922. Recognized common-law exceptions: (1) public-policy exception (Tameny v. Atlantic Richfield Co., 27 Cal.3d 167 (1980)); (2) implied-contract exception (Foley v. Interactive Data Corp., 47 Cal.3d 654 (1988)); (3) implied covenant of good faith and fair dealing (limited to contract damages, Foley supra). Statutory limits: FEHA anti-discrimination, retaliation, whistleblower, and protected-activity provisions further restrict termination. | employment-offer-letter | Before first hire |
| Add the California-specific posters to the worksite display alongside the federal FLSA, OSHA, and EEO notices | California-specific required workplace postings include: 'California Workplace - Know Your Rights' (annual, effective February 1, 2026); IWC wage orders; state minimum wage; paid sick leave; payday notice; 'Safety and health protection on the job'; emergency phone numbers; access to medical and exposure records; 'Operating Rules for Industrial Trucks'; 'Notice to employees -- injuries caused by work'; notice of workers' compensation carrier and coverage; whistleblower protections; no-smoking signage; log and summary of occupational injuries and illnesses; 'Farm labor contractor statement of pay rates' (where applicable); prevailing wage rate determinations (public works) | - | Before hire |
Frequently Asked Questions
$16.90 per hour, effective January 1, 2026, for all employers not otherwise covered by a higher minimum wage specific to an industry or a locality
California requires the new-hire report to be filed Within 20 days of hire date. The federal anchor for the report itself is the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996.
In California, the E-Verify posture for private employers is: California does NOT require E-Verify for private employers; Cal. Labor Code Article 2.5 (sections 2810.40 et seq., enacted via AB 1236, 2011) prohibits state or local governments from mandating private-employer E-Verify use, except where federally required; AB 622 (2015) prohibits using E-Verify on applicants pre-offer or on existing employees except as federally required Federal contractors with a FAR E-Verify clause must still use E-Verify regardless of state law.
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Landlord Rules in California: Renting Out Property (2026)
How to File a Small Claims Lawsuit in California (2026)
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