What Is the CPRA and Why Does It Matter for Employers?

The California Privacy Rights Act (CPRA) is an expansion of the California Consumer Privacy Act (CCPA). It became fully enforceable on July 1, 2023, after the employee data exemption expired on January 1, 2023. This means:

•Employee personal information now receives the same privacy protections as consumer data

•Employers must provide privacy notices, data access rights, and deletion rights

•HR teams must implement formal data governance processes

For small and mid-sized businesses, the CPRA represents a major operational shift in HR, payroll, recruiting, and employee management.

Does the CPRA Apply to Your Business?

The CPRA applies to for-profit businesses operating in California that meet any one of the following thresholds:

•$25 million or more in annual gross revenue

•Buy, sell, or share personal information of 100,000 or more California residents

•Derive 50% or more of revenue from selling or sharing personal information

Important HR Consideration

The 100,000-record threshold includes employees, job applicants, contractors, and dependents — not just customers. Businesses using tools like Google Analytics, Meta Pixel, or applicant tracking systems can reach this threshold faster than expected. Even if your company is headquartered outside California, having California-based employees triggers CPRA obligations.

What Employee Data Is Covered Under CPRA?

The CPRA covers nearly all personal information collected in the employment context.

Personal Information Includes:

•Contact details (name, address, email, phone number)

•Social Security numbers

•Resumes and job applications

•Compensation and payroll data

•Benefits enrollment records

•Performance reviews and disciplinary records

•Timekeeping and attendance data

•Internal emails and communications

Sensitive Personal Information (SPI)

CPRA introduces a new category requiring enhanced protections, including:

•SSNs, driver’s license, and passport numbers

•Financial account credentials

•Precise geolocation data

•Race, ethnicity, religion, or union membership

•Biometric data (fingerprints, facial recognition)

•Health and medical information

•Sexual orientation or sex life data

•Private communications (emails or messages)

Employee Privacy Rights Under the CPRA

California employees now have seven enforceable privacy rights:

1. Right to Know – What data is collected, used, and shared

2. Right to Access – Copies of personal information

3. Right to Delete – Subject to legal and business exceptions

4. Right to Correct – Inaccurate or outdated data

5. Right to Limit Use of Sensitive Information

6. Right to Opt Out – Sale or sharing of personal data

7. Right to Non-Discrimination – No retaliation for exercising rights

Key CPRA Compliance Requirements for Employers

1. Employee Privacy Notice at Collection

Employers must provide a CPRA-compliant privacy notice at or before collecting employee data, including during:

•Job applications

•Hiring and onboarding

•Benefits enrollment

•Monitoring or surveillance implementation

The notice must clearly explain:

•Categories of data collected

•Purpose of collection and use

•Data sharing with third parties

•Retention periods

•Employee rights and how to exercise them

This notice is separate from your website privacy policy.

2. Updated Privacy Policies

Your privacy policy must:

•Be updated annually

•Include disclosures for employee and applicant data

•Be easily accessible to employees

3. Data Subject Request (DSR) Process

Employers must respond to employee privacy requests within 45 days (with a possible extension). You need:

•A request intake method

•Identity verification procedures

•Documentation of all requests

•A process to search across HR systems, email, and storage platforms

4. Vendor and HR Technology Contracts

Any vendor handling employee data must have CPRA-compliant contract terms, including:

•Restrictions on data use

•Prohibitions on selling or sharing data

•Security safeguards

•Audit and compliance rights

This includes payroll providers, HRIS platforms, benefits administrators, and background check services.

5. Data Mapping and Inventory

You must know:

•What employee data you collect

•Where it’s stored

•Who has access

•How long it’s retained

Systems typically include:

•HRIS and payroll platforms

•Email and collaboration tools

•Timekeeping software

•Benefits portals

•Cloud storage and physical files

6. Reasonable Security Safeguards

Employers must implement security measures appropriate to data sensitivity, such as:

•Role-based access controls

•Encryption

•Incident response plans

•Regular security assessments

•Employee training

Practical CPRA Compliance Steps for Small Businesses

•Confirm Applicability – Even growing companies should prepare early

•Conduct a Data Audit – Include digital and physical records

•Draft Employee Privacy Notices – Use CPRA-specific language

•Create Request Handling Procedures

•Review Vendor Contracts

•Practice Data Minimization – Collect only what you need

•Train HR and Managers

•Implement Data Retention and Deletion Policies

Common CPRA Compliance Mistakes to Avoid

•Ignoring remote California employees

•Forgetting former employees and job applicants

•Assuming old vendor contracts are compliant

•Overlooking internal emails and Slack messages

•Treating sensitive data the same as standard data

CPRA Penalties and Enforcement Risks

The California Privacy Protection Agency (CPPA) enforces the CPRA. Potential penalties:

•Up to $2,663 per unintentional violation

•Up to $7,988 per intentional violation

•Each affected employee counts as a separate violation

While large companies have faced the biggest fines so far, small businesses are not exempt, especially if they ignore compliance entirely.

Why CPRA Compliance Is Also a Trust Opportunity

Beyond legal compliance, CPRA is a chance to:

•Increase transparency with employees

•Reduce unnecessary data collection

•Strengthen internal security practices

•Build a culture of privacy and accountability

Employees who trust how their data is handled are more engaged and confident in leadership.

Final Thoughts: CPRA and the Future of Employee Privacy

The CPRA marks a lasting shift in how employers must handle employee data in California. Other states are following with similar privacy laws, making proactive compliance a smart long-term strategy. For California employers, success comes from:

•Understanding your obligations

•Implementing clear procedures

•Treating employee data with care and respect

Data privacy isn’t just about avoiding penalties — it’s about doing right by your people. And in today’s workplace, that’s good law and good business.