California Separation Notice Requirements
There’s a lot to consider when it comes to employee separations—from communication to compliance. Though organizations strive to keep the exit experience positive, myriad state and federal laws make that increasingly challenging—and California is no different. As of January 1, 2020, workers in California are considered employees unless proven otherwise.
With the onus of employee separations falling to HR teams, staying current on the latest requirements is critical. For those operating in California, that means having additional insight and forms readily available.
Frequently Asked Questions
What is a separation notice?
A separation notice is a state-approved document that employers send to employees at the time of termination. While not all states mandate separation notices, California does—and that’s not the state’s only requirement. The California Employment Development Department (EDD) has further stipulations that accompany these notices.
With regard to the notice itself, the California EDD states:
Written notice must be given immediately to employees of their discharge, layoff, leave of absence, or change in employment status … No written notice is required if it is a voluntary quit, promotion or demotion, change in work assignment of location (some changes in location require a WARN notice), or if work stopped due to a trade dispute.
Note that the state of California doesn’t use the term “separation notice.” Instead, the sample form provided on the California EDD website is titled “Notice to Employee as to Change in Relationship.” This serves to meet the provisions set forth by Section 1089 of the California Unemployment Insurance Code.
What information does the California separation notice include?
The California EDD sample separation notice includes:
The employee’s name
The employee’s SSN
The date the layoff or discharge goes into effect
The date the leave of absence starts
The date the employment status will change
A description of the change
The employer’s name
Authorized signature
Is the employer required to send a separation notice to every employee upon termination?
Yes, in the state of California, employers must provide immediate notice to all terminated employees. Beginning with the January 1, 2022 enactment of California Senate Bill No. 657, employers have the option to distribute these notices electronically.
As mentioned above, along with the written separation notice, employers must also deliver two pamphlets to terminating employees. These include For Your Benefit: California’s Programs for the Unemployed and, for organizations with more than 20 employees, Notice to Terminating Employees – Health Insurance Premium Payment Program. Per the Society for Human Resource Management (SHRM), employers must also notify any covered, terminated employees of their Cal-COBRA continuation rights.
Employers in California should be familiar with each of these requirements to ensure compliance with state-specific laws.
When should California employers send the separation notice to the employee?
California EDD stipulates that separation notices be delivered immediately upon involuntary termination. Failure to do so puts the organization at risk of noncompliance.
If the employee resigns or retires, is the employer still required to send a separation notice to the employee?
No, the California EDD does not mandate the use of separation notices in cases of voluntary changes in status.
Will employers receive requests for separation information from the California Employment Development Department?
The California EDD may notify employers when a former employee files for unemployment insurance benefits. This helps the EDD verify the information detailed in the Notice to Employee as to Change in Relationship form provided at the time of the separation. It is important to show documentation in response.
What are the penalties for not complying with California Separation Notice requirements?
Failure to comply with any state regulation puts an organization at risk. To avoid the possibility of a penalty, employers should be thoughtful, honest, and consistent during the employee separations process and complete all requirements as directed.