Federal rules apply in California as they do everywhere. On top of them, California has its own rules on retirement savings, paid sick leave and continued health coverage.
Retirement savings: CalSavers
Since January 1, 2026, every California employer with one or more employees must offer a qualified retirement plan or register with CalSavers, unless it has a valid exemption. The last group to come in, employers with 1 to 4 employees, had until December 31, 2025 to register or ask for an exemption.
If you already sponsor a qualified plan, that plan counts. If you do not, CalSavers is the state’s program. An advisor can walk through both.
Paid sick leave
California employers must let each worker use at least five days or 40 hours of paid sick leave a year, whichever is more. This rule took effect on January 1, 2024.
Continued health coverage: Cal-COBRA
Federal COBRA generally starts at 20 employees. Cal-COBRA extends continuation coverage to employees of California employers with 2 to 19 employees. If you offer a group health plan, ask your advisor how Cal-COBRA works with it.
Questions to bring to your advisor
- Do we sponsor a plan that counts, or do we need CalSavers?
- How does our paid sick leave policy line up with the state rule?
- If we offer a group health plan, how does Cal-COBRA apply to us?
- Do we have people working in other states too?
