This is the Legislature’s second attempt to pass the law. The Governor vetoed an earlier version, SB 7, in October 2025 after calling it overly broad. SB 947 is narrower, but it changes how managers and HR departments can use productivity scores, rankings, and other automated metrics when making decisions about a worker’s employment.

What Counts as an Automated Decision System

SB 947 defines an automated decision system (ADS) broadly. It covers any computational process built on machine learning, statistical modeling, data analytics, or AI that produces a simplified output, such as a score, classification, or recommendation, that is used to assist or replace human decision-making. Ordinary tools like spam filters, firewalls, calculators, and databases are excluded.

That definition reaches many tools employers already use without thinking of them as AI. Software that scores productivity, flags idle time, grades customer service calls, or ranks employees for cuts may all qualify.

What the Law Requires

Once the law takes effect, employers must follow several rules:

• An employer may not rely solely on an ADS to make a disciplinary or termination decision.
• If an employer relies primarily on an ADS, a human reviewer must corroborate the decision using the underlying data or other evidence, such as supervisor evaluations, personnel files, work product, peer reviews, or witness interviews.
• If the system’s output cannot be corroborated, or the reviewer finds it inaccurate, incomplete, or misleading, the employer cannot use it to discipline or fire the employee.
• An employer may not use an ADS to infer an employee’s protected status under the Fair Employment and Housing Act (FEHA), or to predict and punish an employee for exercising their legal rights.
• An employee may request a description of their own data that the system used.

When an employer informs an employee of a decision that relied primarily on an ADS, it must also provide a separate, plain-language written notice. The notice must state that an ADS was primarily relied on, that a human reviewed and corroborated the decision, who the employee can contact, and that retaliation is prohibited.

The Shift in Managerial Liability

For years, a manager could point to a dashboard and say that the system flagged the employee. SB 947 ends that practice for discipline and termination decisions. The person who signs off is now responsible for verifying the output with independent evidence, and the employer must be able to show that the review actually happened.

The law also shifts the burden in enforcement proceedings. Once it is shown that an ADS was used in a disciplinary or termination decision, the employer must prove either that it did not primarily rely on the system or that it followed the review and notice requirements. An employer that cannot document its human review will have a hard time meeting that burden.

HR Departments Will Need Structured Oversight Protocols

To comply, employers will need to build human review into their decision-making process rather than treating automated metrics as automatic grounds for discipline. Employers will need to:

• Inventory the tools they use that may meet the definition of an ADS, including those built into scheduling, timekeeping, and performance software.
• Designate reviewers who have the authority and training to question the system’s output rather than simply approving it.
• Document the evidence used to corroborate each decision that relied primarily on an ADS.
• Prepare written notices and a process for responding to employee data requests.
• Review vendor contracts to make sure they can access the underlying data a reviewer needs.

A reviewer who rubber-stamps whatever the system recommends does not satisfy the law. The corroboration must be real, and the employer must be prepared to prove it.

What Happens When an Employer Ignores the Law?

SB 947 is enforced by the Labor Commissioner and public prosecutors, who can seek injunctions, attorney’s fees, and a civil penalty of $500 per violation. The law does not create a separate private right of action. However, because SB 947 is part of the Labor Code, employees may be able to pursue those penalties on behalf of the state through a representative action under the Private Attorneys General Act (PAGA).

The law covers employees of both private and public employers, including labor contractors. It does not cover independent contractors or job applicants. It also prohibits retaliation against employees who use their rights under the law, file a complaint, or cooperate in an investigation.

SB 947 does not replace the protections that already exist. If an algorithm was used to push out an older worker, a worker on medical leave, or someone who complained about unlawful conduct, that termination may already violate California law today.

Speak to an Employment Attorney About Your Rights

If you were disciplined or fired after an automated system scored, ranked, or flagged you, you may have legal options, both now and once SB 947 takes effect. The employment attorneys at Keller Grover can review what happened, explain your rights under California law, and help you decide how to move forward. Contact our legal team at Keller Grover today to discuss your situation.

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