By Lisa Sherman, Sherman Law Corporation, July 7, 2026
California employment law moves fast. Here is what happened this past week and what it means for you, whether you are an employee wondering about your rights or a business trying to stay compliant.
Harassment Victims Can Band Together in One Lawsuit
Hundreds of Black workers at a Tesla factory have alleged that racial harassment was so widespread that the company effectively ignored it. When they tried to bring their claims together in a handful of group lawsuits, the trial court ordered nearly every worker to file a separate individual case, which would have meant hundreds of parallel lawsuits and a much harder road for each person.
On June 30, the Court of Appeal in Smith v. Superior Court rejected that approach and allowed the workers to keep their claims joined together. The court’s decision was certified for publication, which means other California courts can rely on it.
Why does this matter? Harassment rarely happens to just one person. When a workplace has a culture problem, the strongest evidence is often the shared experience of many employees. This decision makes it easier for workers who experienced the same misconduct at the same workplace to pursue justice together, which levels the playing field against large employers. For employers, it is a reminder that ignoring complaints does not make them go away. It multiplies them.
Arbitration Agreements: The Fine Print Matters More Than Ever
Many California workers have signed arbitration agreements, often without realizing it, that require workplace disputes to be decided by a private arbitrator instead of a jury. Courts will refuse to enforce agreements that are too one-sided, but a new federal appeals court decision, Cocom v. ABM Aviation, shows that a carefully written agreement will generally hold up.
The takeaway for employees: if you signed an arbitration agreement, do not assume it is either bulletproof or worthless. Whether it can be enforced depends heavily on how it was written and how it was presented to you. That is a question worth having a lawyer look at before you decide how to pursue a claim.
The takeaway for employers: agreements that are limited to employment disputes and use standard employment arbitration rules are far more likely to be enforced than sweeping, one-sided ones. If your agreements have not been reviewed recently, now is a good time.
Big Wage Penalty Cases Are Not Automatic Paydays
In another decision published in recent weeks, Taduran v. Glidewell, a worker brought claims under California’s Private Attorneys General Act, a law that lets employees sue for Labor Code violations on behalf of the state and their coworkers. The maximum penalties in the case added up to roughly $56 million on paper. The court awarded about $516,000, and the Court of Appeal said that was fine, because judges have broad discretion to reduce penalties to a fair amount.
For workers, this is a reality check on headlines about massive wage lawsuits. These cases remain a powerful tool, especially where employers shorted real wages, but courts look closely at how much harm actually occurred. For employers, the flip side is encouraging: companies that keep accurate payroll records and fix mistakes quickly are treated far better by the courts than those that do not.
Minimum Wage Went Up on July 1
If you work in healthcare, your minimum wage likely increased on July 1, 2026, with new rates ranging from $19.28 to $25 per hour depending on the type of facility. Many California cities also raised their local minimum wages the same day.
Check your pay stubs. If your employer has not adjusted your rate, you may be owed back pay. Employers should confirm they are using the correct rate for every location and facility type, because underpayment claims add up quickly.
Have a Workplace Issue?
Whether you’re an employee or an employer, if you have a workplace issue you wish to discuss, contact Sherman Law Corporation at lisa@sherm-law.com or call 323-488-2087.
This post is attorney advertising and is provided for general informational purposes only. It is not legal advice and does not create an attorney-client relationship. Every situation is different; consult a lawyer about your specific circumstances.
