Bill > AB692

This bill addresses employment contracts that potentially restrict workers' professional mobility by making certain contract provisions unlawful, effective January 1, 2026. Specifically, the bill prohibits employment contracts from requiring workers to pay employers, training providers, or debt collectors for financial obligations if their employment terminates, or imposing penalties, fees, or costs related to job separation. The legislation defines key terms broadly, including who qualifies as a "worker" and what constitutes a "debt" or "employment-related cost." The bill provides some exceptions, such as for governmental loan repayment programs, tuition reimbursement contracts for transferable credentials with specific consumer protections, and approved apprenticeship programs. Workers, prospective workers, or their representatives can bring civil actions against employers who violate these provisions, with potential penalties of $5,000 or actual damages (whichever is greater), plus attorney's fees. The Labor Commissioner is authorized to enforce these provisions, investigate complaints, and coordinate with the Attorney General. Importantly, the bill declares contracts with these prohibited terms as void and contrary to public policy, aiming to prevent employers from restricting workers' ability to change jobs or pursue professional opportunities.

Budget and Finance, Justice, Labor and Employment

https://leginfo.legislature.ca.gov/faces/billStatusClient.xhtml?bill_id=202520260AB692