On May 21, 2024, with a vote of 25-12, the California Senate passed SB-1446, a bill that would significantly restrict grocery and retail drug stores from providing self-checkout services and adopting new technologies. The bill, introduced on February 16 by Sen. Smallwood-Cuevas, rapidly moved through the California Senate Committee process and now has been sent over to the California Assembly for consideration. Retailers who provide self-checkout for their consumers or are looking to adopt new technologies should review the strict requirements in this bill and prepare to adjust their policies accordingly if the bill moves as swiftly through the California Assembly.

The bill applies to grocery establishments and retail drug establishments. Grocery establishment is defined as a retail store over 15,000 square feet in size and that sells primarily household foodstuffs for offsite consumption. Retail drug establishment is defined as an entity that has 75 or more establishments in California and is classified as a pharmacy or drug retailer under the North American Industry Classification System. The bill defines self-service checkout as “an automated process that enables customers to scan, bag, and pay for their purchases without human assistance” and incorporates self-service checkout into a covered company’s assessment of potential work hazards.

The bill has four main requirements for a covered company to provide self-service checkout options for their customers.

  1. A covered company must have a manual checkout station staffed by an employee whenever a self-service checkout option is available.
  2. The company must have a policy that limits self-checkout to no more than 15 items and must post signs on the self-service checkout stations indicating the policy.
  3. Customers cannot use self-service checkout to purchase items that require identification such as alcohol and tobacco and items subject to special theft-deterrent measures that require employees to access.
  4. One employee cannot monitor more than two self-service checkout stations simultaneously, and when an employee is monitoring self-service checkout stations, that employee must be relieved from all other duties including operating a manual checkout station.

The other main section of the bill requires covered companies to complete an impact assessment before using or procuring a consequential workplace technology. Consequential workplace technology means “artificial intelligence or automated decision making systems that significantly impacts, eliminates, or automates the core job functions agreed upon between an employer and an employee upon hire or following a subsequent change in position or department.” The bill specifically includes self-checkout robotics, wearable sensors, scanners, and electronic monitoring.

At least 60 days before conducting the assessment, a covered company must notify workers potentially impacted and their collective bargaining representative. While completing the assessment, the covered company must have direct, meaningful, and sustained involvement of impacted employees. The assessment needs to be provided to employees 60 days before implementation of the consequential workplace technology and then posted in a location accessible to employees and customers for 90 days following implementation.

Assessment means a study evaluating the potential negative effects on employees, consumers, or the public of a consequential workplace technology and includes a description of the technology, the data used  and collected by the technology, the number of employees and jobs that would be impacted including the salaries and benefits eliminated, skill gaps of employees resulting from the technology, amount budgeted to train affected employees, the effect of the technology on consumers, and the potential health and safety hazards.

Overall, this bill could have a tremendous impact on companies that have retail establishments, slow the adoption of new technology, and limit the usage of self-checkout services. Companies that may be affected should review the bill closely to determine how they can adjust their compliance, especially regarding procurement of new technologies.