Employment contracts: stay-or-pay provisions: contract date.

Existing law generally prohibits an employment contract from requiring a worker to pay certain penalties, fees, costs, or debts related to employment or education if the worker's employment or work relationship terminates, as provided. Existing law provides that a contract that is unlawful under that prohibition is void and contrary to public policy as a restraint of engaging in a lawful profession, trade, or business. Existing law authorizes a worker, among other persons, to bring a civil action for specified civil penalties and relief for a violation of these provisions.

Existing law applies these prohibitions to contracts entered into on or after January 1, 2026.

This bill would instead apply those provisions to contracts entered into on or after January 1, 2027.

This bill would declare that it is to take effect immediately as an urgency statute.