Top 10 Employment Law Mistakes Employers Make—and How to Avoid Them
Running a business comes with its fair share of responsibilities—and few are as important (or as risky) as managing your employees in compliance with California’s strict employment laws. At Kraeber Law, we’ve helped numerous employers in Brentwood and across California avoid lawsuits, regulatory fines, and other costly missteps. Below are the top 10 employment law mistakes we see—and how you can steer clear of them.
1. Misclassifying Employees as Independent Contractors
One of the most common and dangerous errors is misclassifying workers. With California’s ABC Test, it's more difficult than ever to justify treating someone as an independent contractor.
Avoid it: Have an attorney review your worker classifications to ensure they meet legal standards under California law.
2. Failing to Pay Overtime Properly
California has strict rules for overtime—more stringent than federal law. Failure to pay time-and-a-half after 8 hours in a day or 40 in a week can quickly lead to litigation.
Avoid it: Audit your timekeeping and payroll systems regularly for compliance.
3. Not Providing Legally Compliant Meal and Rest Breaks
Employers must provide meal breaks after 5 hours of work and rest breaks for every 4 hours worked. Skipping these or failing to document them correctly can result in penalties.
Avoid it: Establish clear break policies and ensure managers enforce them.
4. Incomplete or Outdated Employee Handbooks
A well-crafted employee handbook isn’t just good policy—it’s a legal shield. But many handbooks are outdated or incomplete, leaving employers vulnerable.
Avoid it: Have your handbook reviewed and updated annually by an employment law attorney.
5. Terminating Employees Without Proper Documentation
Firing an employee “at will” doesn’t mean you’re immune from wrongful termination claims. Documentation is your best defense.
Avoid it: Keep detailed records of performance issues and disciplinary actions.
6. Ignoring Harassment and Discrimination Complaints
Whether it’s sexual harassment or a discrimination allegation, ignoring or mishandling a complaint can lead to expensive lawsuits and reputational damage.
Avoid it: Investigate every complaint thoroughly and implement proper training programs.
7. Failing to Provide Final Paychecks on Time
In California, employers must provide an employee’s final paycheck immediately upon termination or within 72 hours if they quit without notice.
Avoid it: Create a system to process final paychecks quickly and correctly.
8. Not Reimbursing Business Expenses
California law requires employers to reimburse employees for necessary business expenses, including mileage, work-related cell phone use, and remote work expenses.
Avoid it: Have a clear expense reimbursement policy in place.
9. Inadequate Sexual Harassment Training
All employers with five or more employees are required to provide sexual harassment prevention training every two years.
Avoid it: Schedule and document compliant training sessions for all staff and supervisors.
10. Failing to Consult an Employment Law Attorney
Many employers make legal decisions based on outdated advice or guesswork—and end up in court. Proactive legal guidance is crucial.
Avoid it: Partner with a trusted employment law firm to review your policies, handle disputes, and stay compliant.
Protect Your Business—Partner with Kraeber Law Today
At Kraeber Law, we help California employers navigate the complex world of employment law with confidence. Whether you're drafting contracts, responding to a complaint, or just want to avoid making costly mistakes, our team is here to support you.
Schedule a consultation by calling (925) 319-5791 or contacting us online today!