The widespread adoption of remote work has disrupted longstanding assumptions regarding which state’s employment laws govern a particular worker. A company may be headquartered in California, employ a worker residing in Utah, have that worker supervised from Washington, and have an employment decision about that worker made by executives who were physically present in Illinois at the time they acted. The question then arises: can the employee bring claims against the employer under California employment law?
The California Court of Appeal’s recent decision in Saberin v. Alation, Inc. (Cal. Ct. App., 1st Dist., Div. 5, No. A174549, July 30, 2026) addresses this question directly. The case provides guidance on whether and under what conditions California’s employment statutes apply to a worker who resides and performs services entirely outside the state, when the employment decision at issue was made by individuals who were themselves located outside California at the relevant time. While the case’s underlying dispute concerned an alleged wrongful termination, the decision’s paramount relevance for employers lies in its treatment of the geographic reach of California employment law in the context of a multi-state workforce.
Case Background
Pejman Saberin was employed remotely from Utah as an engineer by Alation, Inc., a data analytics company headquartered in California. Saberin was arrested while traveling out of state, and Alation subsequently terminated his employment. Saberin initiated legal proceedings in California, and the dispute was submitted to arbitration pursuant to an agreement he had executed.
A dispute regarding the application of California’s employment statutes ensued. Alation contended that California employment law did not extend to the dispute, on the grounds that Saberin worked exclusively from Utah and that the decision to terminate his employment was made by two executives while they were physically located in Illinois. Saberin responded that a California-based HR business partner had provided “input” into the decision, and argued that this involvement was sufficient to establish a connection to California, particularly given that Alation is headquartered in the state and that one of the executives ordinarily worked remotely from California.
The arbitrator ruled in favor of Alation, concluding that the termination decision was made outside the state and that Saberin had no meaningful connection to California. Saberin petitioned the trial court to vacate the arbitration award, arguing that the arbitrator had misapplied California’s rules governing the extraterritorial reach of its employment statutes. The trial court upheld the award, and Saberin appealed.
The Holding on Remote Work and Extraterritoriality
The Court of Appeal affirmed, holding that neither Saberin nor the underlying conduct bore a sufficient connection to California to trigger the California statutes at issue. In reaching that conclusion, the court articulated several principles of broad relevance to employers managing remote and multi-state workforces:
- There is no single test for determining when a California employment statute reaches an out-of-state worker. Following the California Supreme Court’s decision in Ward v. United Airlines, the court confirmed that each statute must be analyzed on its own terms, examining its text, purpose, and legislative history to determine what connections to California are sufficient to invoke the statute’s protections.
- The physical location of the actual decisionmakers at the time of the decision is critical. The court looked to where the individuals who made the substantive employment decision were physically present when the decision was rendered. Here, one of the two decisionmakers ordinarily worked remotely from California, but both were in Illinois when they acted, which was dispositive.
- Mere “input” from a California-based employee does not establish a sufficient nexus. A California-based HR partner provided background information and relayed the termination decision but did not substantively participate in or ratify the decision. The court found this level of involvement too “tenuous” to support extraterritorial application of the statutes.
- A company’s headquarters location does not, by itself, establish a California connection. Although Alation is headquartered in California and its “principal offices” are in California, the court declined to treat those facts as sufficient to invoke the state’s employment statutes where neither the affected worker nor the termination decision had a meaningful tie to the state.
- A California choice-of-law clause in an employment agreement does not, standing alone, extend California employment protections to out-of-state workers. Saberin’s arbitration agreement specified that employment-related claims would be resolved pursuant to California law. The court held that such a clause incorporates all of California law, including its presumption against extraterritorial application, and therefore did not resolve the extraterritoriality question in the employee’s favor.
Implications for Employers
This is a California state-law decision, and it does not create new obligations for employers with no connection to California. The decision applies most directly to workers with no personal connection to California – Saberin resided in Utah and maintained no residency or employment ties to the state. It does not alter the law applicable to workers who perform their duties primarily in California, or whose employment decisions are made by individuals physically located in California at the relevant time. The court expressly declined to address whether the outcome would differ for an employee who resides in California but works entirely remotely for an employer with no in-state offices. Thus, employers should not assume that this decision insulates them from claims asserted by California-resident remote workers.
For employers with remote or multi-state workforces, the holding offers a measure of reassurance: an employer is not automatically subject to a California employment statute merely because it is headquartered in the state, or because a California-based employee played some role in a personnel decision. Where the affected worker has no ties to California and the substantive decision was made by individuals physically located outside the state, California law may not extend to the claim.
However, this is a narrow, fact-specific holding, not a broad safe harbor. The outcome depended on facts the employer was able to document with precision, and the court was deliberate in circumscribing its reach in several respects.
The decision also calls for a statute-by-statute analysis. Because California courts must examine the text, purpose, and legislative history of each statute to determine its geographic reach, a favorable extraterritoriality outcome with respect to one category of claim does not automatically extend to other California employment statutes.
The court noted but left unresolved the question of whether strategic relocation of decisionmakers outside California for the purpose of avoiding the reach of California employment law could itself establish a sufficient California connection. Thus, employers should not construe this decision as authorization to relocate decisionmakers to circumvent statutory obligations.
Practical Takeaways
- Document decision-making location. When making significant employment decisions, maintain a clear contemporaneous record of the individuals who made the substantive determination and their physical location at the time. Such records may prove critical in the event a dispute subsequently arises regarding which state’s law applies.
- Distinguish between input and decision-making authority. Where California-based personnel are involved in a personnel decision affecting an out-of-state worker, their role should be confined to administrative support rather than substantive participation, if the objective is to avoid invoking California law.
- Do not treat this decision as protection for California-resident remote employees. The court left that question unresolved. Employers whose employees reside in California, even where those employees work entirely remotely and the company maintains no California office, should proceed on the assumption that California law may apply.
- Do not rely on this decision with respect to other statutes without independent analysis. Because courts analyze the geographic reach of each statute individually, a favorable outcome on one category of claim does not automatically extend to other California employment statutes.
- Exercise caution regarding the strategic relocation of decisionmakers. Personnel decisions should be based on ordinary business considerations, not undertaken as a mechanism for circumventing statutory obligations.
- Review choice-of-law and arbitration clauses with realistic expectations. A California choice-of-law provision in an offer letter or employment agreement will not, standing alone, extend California employment protections to out-of-state workers. Such clauses should be drafted with due consideration of the current interstate employment landscape.
The Bottom Line
Saberin v. Alation confirms that California employment statutes do not operate extraterritorially merely because a company is headquartered in the state. However, the decision is a narrow one, turning on a factual record in which the affected worker had no ties to California and the decisionmakers were demonstrably located elsewhere at the time they acted. As remote and hybrid work arrangements continue to erode traditional geographic boundaries, employers should anticipate that this will remain an evolving area of law, and should establish rigorous documentation practices now, rather than attempting to reconstruct the relevant facts after a dispute has arisen.