California's "No Robo Bosses" Act Proposes Significant Changes to Workplace Artificial Intelligence Regulations
California's "No Robo Bosses" Act: What Employers Need to Know
California is poised to lead the nation in shaping the rules of the road for AI in employment, with the potential passage of the "No Robo Bosses" Act, also known as SB 7. This bill, if enacted, will impose new obligations on employers using automated decision systems.
What is SB 7?
SB 7 requires employers to notify workers and job applicants when an automated decision system is in use. It prohibits employers from relying solely on these systems to discipline, terminate, or deactivate a worker. Human review and other forms of evidence must be considered.
The bill covers employment-related decisions across the entire lifecycle, including hiring, performance management, promotion, scheduling, termination, and productivity tracking. However, it includes limited carve-outs for employers parties to valid collective bargaining agreements and those required to use automated decision systems under federal law or as a condition of federal contracts.
Enforcement Mechanisms
SB 7 includes multiple enforcement mechanisms. The Labor Commissioner can conduct investigations, public prosecutors can bring civil actions, and workers can file private lawsuits.
Compliance Burden
The bill preserves local ordinances that offer greater protections, potentially adding to compliance burdens for employers in certain jurisdictions. Employers would need to provide written notice at least thirty days before deployment, excluding hiring-related systems.
Recordkeeping Requirements
The bill also imposes strict recordkeeping requirements, requiring employers to retain all data related to the use of automated decision systems for at least four years.
Worker's Rights
Workers would have the right to request a copy of the personal data used by an automated decision system in decisions involving discipline, termination, or deactivation. They would also have the right to know when such systems are being used in job evaluations.
Preparing for SB 7
Employers should begin preparing for SB 7 by inventorying all automated decision systems currently in use, drafting plain-language notices, establishing protocols for human oversight, and training managers, HR professionals, and compliance teams on both SB 7 and the upcoming regulations from the California Civil Rights Council.
The Council's Regulations
The regulations emphasize the employer's responsibility to prevent adverse impact and to offer reasonable accommodations when automated tools may disadvantage certain applicants or employees. They prohibit the use of automated decision systems that result in discrimination based on protected characteristics such as race, gender, disability, age, or national origin.
The regulations also impose strict recordkeeping requirements, requiring employers to retain all data related to the use of automated decision systems for at least four years. The final regulations, under the Fair Employment and Housing Act (FEHA), will take effect on October 1, 2025.
California's Leadership
California continues to lead the nation in shaping the rules of the road for AI in employment, signaling a growing demand for transparency, fairness, and human judgment in algorithmic management. The passage of SB 7 and the upcoming regulations from the California Civil Rights Council underscore this commitment.
Implications for Companies
If SB 7 becomes law, companies and organizations operating in California with annual revenues over $500 million must implement the mandated disclosure and transparency measures regarding climate-related financial risks, including governance readiness, risk assessment, and reporting every two years starting January 1, 2026. Employers that take proactive steps now will be better positioned to adapt to whatever comes next, not just in California, but across the country.
California is one step away from passing the "No Robo Bosses" Act, a bill that imposes new obligations on employers using automated decision systems. Employers should closely monitor the progress of SB 7 and begin preparing for its potential implementation.
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