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On August 30, 2020, the California state legislature passed Assembly Bill 1281 (AB-1281), which amends the California Consumer Privacy Act (CCPA) to extend the CCPA’s employee and business-to-business exemptions by one year, until January 1, 2022.  Under these exemptions, businesses subject to the CCPA are not required to comply with the CCPA’s full requirements regarding (1) personal information collected by businesses regarding employees, contractors, and applicants; and (2) personal information collected by businesses in the course of business-to-business communications or transactions.  As explained in the Assembly Floor Analysis, the extension provides more time for the California legislature to work on developing a comprehensive framework for business-to-business communications and transactions and the collection of certain personal information by employers, which has been put on hold due to the legislature’s focus on the COVID-19 pandemic.  AB-1281 now moves to the California Governor’s office, where it is expected that Governor Newsom will sign the bill into law.

Notably, AB-1281 will become inoperative if California voters approve the California Privacy Rights Act (CPRA) ballot measure in the November 3, 2020 election.  If the CPRA passes in November, then the CPRA will extend the employee and business-to-business exemptions for two years until January 1, 2023.  If, however, the CPRA fails, then the exemptions will still be extended until January 1, 2022 under AB-1281.  In either case, businesses subject to the CCPA will have at least another year before the employee and business-to-business exemptions sunset.

For more articles and alerts on this or other significant data protection laws and developments, follow the Fey LLC LinkedIn page here.

Keith Geekie, an information analyst with Fey LLC, contributed to this post.

Hannah Zimmerman

Hannah Zimmerman, CIPT, is an associate attorney with Fey LLC.