On September 14, 2023, California lawmakers passed Bill 799 (the Bill) making employees eligible for unemployment benefits while on strike. The Bill, making California one of just three states to authorize unemployment benefits for striking workers, now moves to Governor Gavin Newsom for his signature. If signed, the change will take effect on January 1, 2024.

Prior to the Bill, California, like most states, precluded eligibility for unemployment compensation for employees who are out of work due to a “trade dispute” with their employer. If signed, employees who miss work due to a trade dispute, including those who are on strike, will have their eligibility for unemployment benefits restored after just two weeks. Notably, Governor Newsome signing this Bill will have a significant impact on the labor movement not only in California, but across the country.

The dramatic increase in labor activity and strikes this year, especially in California, has brought this particular unemployment benefits issue to national attention. The Bill would mark a fundamental shift for future strikes and strikes that are currently ongoing in California. The lack of unemployment benefits for striking workers has long required unions to delve further into their own coffers to provide strike benefits to its members and has granted additional leverage to employers while strikes are ongoing. This change would also impose additional costs on employers who fund California’s unemployment benefits fund.

While most states continue to deny unemployment benefits to striking workers, a growing number of states may seek new legislation in the coming year as the rise in union activity shows no signs of slowing down.