| Right-to-disconnect law | No statewide law |
| Electronic monitoring disclosure | Required by statute |
| Expense reimbursement mandatory | Mandatory by statute |
| State personal income tax | Yes (13.3% top rate) |
California has no statewide right-to-disconnect law. The leading vehicle, AB 2751 (Haney, 2023-2024), would have required employers to establish written policies giving non-exempt and exempt employees the right to ignore work communications outside scheduled hours. The bill was held under submission in Assembly Appropriations on May 16, 2024, and the file shows "Inactive Bill - Died" with a final committee action on November 30, 2024. No successor bill has been enacted as of May 2026. There is no federal right-to-disconnect floor either, so California remote workers currently rely on existing wage-and-hour law (off-the-clock work for non-exempt employees must still be paid under Cal. Lab. Code § 510).
California is an all-parties-consent state. Cal. Penal Code § 631 makes it unlawful to intercept or read the contents of any communication in transit "without the consent of all parties," which means employers cannot silently record video calls, phone calls, or screen audio of remote employees without notice and consent from every participant. Cal. Lab. Code § 435 separately bars audio or video recording in restrooms, locker rooms, or changing areas. Since the CCPA/CPRA employee-data exemption expired on December 31, 2022, employers must also provide CCPA-compliant notice at collection covering keystroke logs, screenshots, location data, and other employee monitoring, and honor employee access and deletion rights.
Cal. Lab. Code § 2802 requires employers to "indemnify" employees for "all necessary expenditures or losses incurred… in direct consequence of the discharge of" their duties, plus reasonable enforcement costs and attorney's fees. In Cochran v. Schwan's Home Service, 228 Cal. App. 4th 1137 (2014), the Court of Appeal held that when employees are required to use personal cell phones for work, the employer must reimburse "a reasonable percentage" of the bill, even if the employee paid a flat rate and incurred no extra out-of-pocket cost. California courts and the DLSE have applied the same logic to home internet, personal device use, and a share of utilities for mandatory remote work. Remote employees in California can typically claim a reasonable percentage of internet, phone, and necessary equipment.
A home-office stipend can be paid tax-free if it is administered under a federal "accountable plan" satisfying IRS Publication 463 and Treas. Reg. § 1.62-2: expenses must have a business connection, be substantiated, and any excess advance must be returned within a reasonable time. California conforms to federal accountable-plan treatment for employee business expenses, so a properly-structured reimbursement is excluded from both federal W-2 wages and California taxable wages. A flat stipend with no substantiation is taxable wages subject to California's graduated personal income tax (top marginal rate 13.3%, the highest in the nation), plus the 1.1% SDI wage assessment. Accountable-plan structuring is therefore especially high-value for California employers and high-earning remote workers.
California anchors the U.S. remote-work economy. The San Francisco Bay Area and Los Angeles together host the largest concentration of remote-friendly tech employers in the country, including Salesforce (which pioneered the "work from anywhere" model), Google, Meta, and Apple. State-level BLS Telework Supplement micro-data was not reachable at verification time; national figures from the BLS Current Population Survey show roughly 19-23% of employed persons doing some telework, with California consistently above the national average due to its tech and professional-services concentration.
Top remote-hub metro: San Francisco Bay Area
Notable remote-work employers headquartered in California:
Our sister site CeoCult covers the federal + California home-office tax deduction methodology in detail, including IRS Form 8829, the simplified $5/sq ft method, and the state-specific quirks for California filers.
Read the California home-office deduction guide on CeoCult →
No. Under Cal. Lab. Code § 2802, your employer must reimburse all "necessary expenditures" you incur in performing your job. Following the reasoning of Cochran v. Schwan's Home Service (2014), California courts and the DLSE treat a reasonable percentage of home internet, cell phone, and necessary equipment as reimbursable when remote work is required or expected — even if you would have paid for internet anyway.
No. AB 2751 (Haney) was the highest-profile attempt, but it was held under submission in Assembly Appropriations in May 2024 and is now listed as an inactive, died bill. No successor has been enacted as of May 2026. Non-exempt employees are still entitled to be paid for all hours worked, including off-hours emails, under existing California wage-and-hour law.
Section 2802 requires your employer to indemnify you for "all necessary expenditures or losses" incurred in the course of your duties, plus reasonable attorney's fees if you have to sue to enforce the right. For remote workers, that commonly includes a reasonable share of cell phone bills, home internet, work-required software, and necessary office equipment.
It depends on structure. If your employer pays it under a federal accountable plan — business connection, substantiation, and return of any excess — it is excluded from both federal and California taxable wages. A flat $200/month with no substantiation is wages subject to California income tax (up to 13.3%) plus the SDI assessment. Ask your employer how the stipend is administered before assuming it's tax-free.