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Business Groups Claim New California Law Breaches 1st and 14th Amendments in Lawsuit


A recent lawsuit from the California Chamber of Commerce claims that a new law imposes restrictions on the First and 14th amendments rights of California businesses.

On New Year’s Eve, California business groups initiated a federal lawsuit contesting a law that bars companies from terminating or otherwise punishing employees who opt out of attending “captive audience” meetings, thereby reversing nearly 80 years of established employer speech protections.
Senate Bill 399, effective January 1, introduces section 1137 to the California Labor Code, banning any punitive actions from employers against employees who decline to participate in meetings concerning the employer’s views on political or religious issues.

The lawsuit, filed by the California Chamber of Commerce and the California Restaurant Association, asserts that this law infringes upon employers’ First and 14th amendment rights by limiting their ability to communicate freely with employees.

“Due to SB 399, California employers now face potential liability, penalties, and other administrative repercussions when they exercise their federal rights to discuss political themes with their employees,” the lawsuit states.

The business groups argue that the bill discriminates against employer speech by regulating the nature of their communications with employees and stifles open discussion. The California Restaurant Association emphasized its entitlement to voice its positions on various issues.

“Throughout the legislative processes, we consistently highlighted that SB 399 represents an extensive overreach,” CalChamber President and CEO Jennifer Barrera mentioned in a statement to The Epoch Times. “SB 399 is evidently discriminatory based on viewpoint, violating the First Amendment rights. Furthermore, SB 399 is preempted by the National Labor Relations Act (NLRA).”

“Employers should have the autonomy to share their views and insights on various topics,” stated Jot Condie, CRA president and CEO, in a comment to The Epoch Times. “SB 399 introduces impractical restrictions, and the negative repercussions of this legislation far exceed any alleged advantages.”

In November 2024, the National Labor Relations Board ruled that captive audience meetings—held during work hours and requiring attendance—are unlawful.

SB 399, sponsored by state Sen. Aisha Wahab, a Democrat, aims to prevent employers from intimidating employees seeking to form or affiliate with a union.

Additionally, it prohibits employers from penalizing employees who opt out of attending employer-led meetings or engaging in discussions relating to the employer’s stance on political or religious issues.

Political matters encompass any communication regarding politicians, political parties, legislation, or labor organizations, while religious matters involve communications about religious beliefs and affiliations.

The legislation makes mandatory meetings on these topics illegal and imposes new limits on interactions related to these subjects between employees and employers.

Violating any of the provisions may result in a civil penalty of $500 for employers. The law additionally permits employees to pursue civil action and seek injunctions from the court.

This new legislation overrides a 1948 ruling, Babcock & Wilson Co., in which the National Labor Relations Board held that employers could conduct captive audience meetings during work hours to communicate their perspectives on union formation.



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