Quick Hits
- California is leading the charge to regulate AI use in the workplace with a suite of new laws targeting workplace monitoring and automated decision-making.
- California’s AB 1883 bans AI-powered workplace surveillance tools that predict employees’ emotional states or collect neural data, and AB 1331 prohibits employers from using workplace surveillance tools to monitor employees in bathrooms.
- SB 947, the “No Robo Bosses Act,” prohibits employers from relying solely on automated decision systems for discipline or termination decisions, effective July 1, 2027.
The bills include Assembly Bill (AB) 1883, which bans AI-driven workplace monitoring tools that make predictions about employees’ emotional states or collect employees’ “neural” data; AB 1331, which prohibits workplace surveillance in bathrooms; Senate Bill (SB) 947, the “No Robo Bosses Act,” which prohibits employers from relying solely on automated decision systems for discipline or termination. Together, these laws increase employers’ potential liability for using AI-powered tools in the workplace.
AB 1883—Workplace Surveillance Tools
AB 1883, titled “Workplace surveillance tools,” was enacted as employers are being offered an increasing array of tools that monitor everything from text and audio to biometric factors and behaviors. The law follows the European Union’s lead as the European AI Act already bans AI systems used for emotion recognition in the workplace and in educational settings.
AB 1883 bans the use of “workplace surveillance tool[s]” that use AI to either: (1) recognize, or make inferences or predictions about, an individual’s emotional state; or (2) collect neural data. “Workplace surveillance tools” are defined in the law as “any system, application, instrument, or device that collects” information about employees’ activities, communications, biometrics, or behaviors in a way other than direct observation by a human. Such tools include video or audio surveillance, time-tracking, geolocation tools, or others that use “a photo-optical system.” Additionally, the law bans the collection of employees’ “neural data,” meaning information that measures employees’ central or peripheral nervous systems.
Violations can result in statutory or civil penalties of up to $500 per violation. Further, although the law does not provide a private right of action, employers may face liability under the California Private Attorney General Act (PAGA), which allows individuals to pursue Labor Code-based penalty claims on behalf of the state.
AB 1331—Workplace Surveillance of Employees
AB 1331 also targets workplace monitoring or surveillance tools that collect “employee data, activities, communications, actions, biometrics, or behaviors by means other than direct observation by a person.” The law prohibits employers from using a workplace surveillance tool to monitor or surveil employees in workplace bathrooms, with limited exceptions, and allows employees to leave surveillance devices behind when entering those areas. AB 1331 permits employers to require employees to use a “workplace surveillance tool, including a badge or personal alarm system” to “access a locked or secured bathroom” so long as it does not have an audio or video recording capability and “does not have physically embedded or attached artificial intelligence.” AB 1331 shares an enforcement structure with AB 1883, including civil penalties of up to $500 per violation.
SB 947—‘No Robo Bosses Act’
SB 947, known as the “No Robo Bosses Act,” will take effect on July 1, 2027. The law is a newer version of a similar law that Governor Newsom vetoed in 2025. The law prohibits employers from relying solely on an automated decision system (ADS) for discipline or termination decisions, requiring a human reviewer to independently corroborate the ADS output. SB 947 also bars using an ADS to infer a worker’s protected characteristics or to predict and retaliate against a worker for exercising legal rights. Additionally, the law requires employers to provide post-use notice to affected employees when an ADS is used in employment decisions.
Increasing Scrutiny of Monitoring Tools
Employers have increasingly embraced workplace monitoring tools to increase productivity, efficiency, and workplace health and safety. An array of monitoring tools is now available that exceed traditional text, audio, internet, and keystroke activity recording. These newer technologies collect and analyze employees’ location data; biometric factors such as heart rate, sweating, and brainwaves (often via wearable devices); linguistic data; and visual recordings that capture micro-expressions, body language, and eye movements. Data can then be analyzed using AI to make predictions about employees, potentially their mental states. This can allow employers to intervene when an employee is in danger or provide support when necessary.
AB 1883 targets many of these AI-driven tools, but the final version of the law is more narrowly tailored than prior versions. It allows non-AI-powered workplace monitoring tools that are not used for the prohibited purposes and explicitly permits employers to use a “workplace surveillance tool” to “ensure safety.” This addresses concerns from some opponents that the bill would potentially have banned basic security surveillance tools and safety measures, such as sensors that can detect distracted or fatigued drivers.
Still, it will be necessary for employers to conduct due diligence on any monitoring tools being implemented or considered to determine what predictions or outputs the tools produce and whether the data collected could be considered “neural data.”
Evolving AI Legal Landscape
The latest package of bills once again puts California at the forefront of AI regulation in the United States. Whereas, under the current administration, there has been a dearth of federal workplace AI legislation, regulations, or other rulemaking, and no action to address AI-powered monitoring tools is expected in the foreseeable future.
The signings come on the heels of Governor Newsom signing two AI executive orders. N-10-26, also signed on September 30, 2026, declares that all state agencies and departments refer to AI technologies as “artificial intelligence” or “AI” regardless of “any rebranded or different terminology used by the federal government.” Signed on September 18, 2026, N-9-26 directs the state to explore increased oversight of AI development, including potentially requiring a “kill switch” for frontier AI models.
In addition, California, Colorado, Connecticut, Illinois, New York City, and Texas all have laws that restrict the use of automated decision tools for significant or consequential employment decisions, such as hiring, promotion, and termination. Those laws could arguably apply to AI-powered employee monitoring tools, particularly if the output of such tools is used to influence key employment decisions. It is expected that states will continue to legislate in this area.
Next Steps
California continues to be on the frontier of AI legislation. Employers should pay close attention to these new California AI laws and the evolving regulatory landscape governing the use of monitoring and AI-powered tools in the workplace. Before implementing a specific tool, employers may want to thoroughly vet what data the tool collects, how that data will be used, and whether the tool uses AI to generate any output from that data, as these new laws place additional compliance requirements on employers.
Employers using automated decision systems for discipline or termination decisions may want to prepare for SB 947’s requirements, including the human reviewer mandate effective July 1, 2027. More broadly, employers may further wish to consider the impact on employee morale and workplace culture when considering the use of a monitoring tool.
Ogletree Deakins’ Artificial Intelligence and Innovation Practice Group will continue to monitor developments and will provide updates on the California, Cybersecurity and Privacy, Employment Law, and Artificial Intelligence and Innovation blogs as additional information becomes available.
In addition, the Ogletree Deakins Client Portal provides subscribers with timely updates on California state laws, including California’s updated laws on Automated Employment Decisions. Premium-level subscribers have access to comprehensive law summaries, policies, and templates. Snapshots and Updates are complimentary for all registered client users. For more information on the Client Portal or a Client Portal subscription, please email clientportal@ogletree.com.
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