October 2022: California Consumer Privacy Act’s Employee and B2B Exemptions to Expire on January 1, 2023

03 Oct

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Update Applicable to:
All businesses that handle the “personal information” of consumers in the state of California.

What happened?
On January 1, 2023, the California Consumer Privacy Act (CCPA) Employee and B2B exemptions will end, and employers with personal information collected in specific employee contexts and a B2B context will now be subject to the onerous compliance requirements under the CPRA.

What are the details?
The California Consumer Privacy Act (CCPA) is California’s legislation that seeks to give California consumers certain rights over how a business handles “personal information” collected about its consumers. On October 11, 2019, California Governor Gavin Newsom signed Assembly Bill 25 into law, which provided businesses with temporary relief by exempting personal information collected in certain employment contexts and in a business-to-business (B2B) context from the scope of the CCPA until January 1, 2021.

Governor Newsom signed Assembly Bill 1281 into law on September 29, 2020, providing a one-year extension to the partial employee and B2B exemptions to January 1, 2022, applicable only if the California Privacy Rights Act (CPRA) ballot initiative failed.

When the CPRA was approved during the 2020 election by California voters, the exemptions were extended one final time to January 1, 2023. On August 31, 2022, the California legislature adjourned without extending the exemptions, which automatically expire on January 1, 2023 in conjunction with the CPRA effective date.

Below is some key information provided by our source, Katten Muchin Rosenman LLP:

For more information, please see the links below:

California Consumer Privacy Act (CCPA)

Assembly Bill 25

Assembly Bill 1281

Article 1Article 2

What do employers need to do?
Employers should review the links provided above and begin to pivot their data privacy compliance efforts towards assessing, reviewing, updating, and disclosing information based on what is required by the law.

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