California Signed Law Limiting Housing Labor Exemptions
Governor Gavin Newsom signed SB 1383 to prevent developers from bypassing local labor standards on tall buildings.
Updated on Oct. 12, 2026 in Unions
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California Governor Gavin Newsom has signed SB 1383 into law, effectively curbing the use of density bonus exemptions by developers to skirt local labor mandates. The legislation specifically targets large residential projects, ensuring they adhere to local worker safety and health coverage requirements.
Why it matters
The measure addresses concerns that developers like Laconia Development and Collab Home were leveraging state laws to bypass local mandates, thereby cutting costs at the expense of worker protections. It aims to ensure that California's housing growth does not diminish labor standards.
SB 1383 establishes a strict 85-foot height threshold for projects attempting to use density bonus exemptions to bypass local labor regulations. The law specifically overrides exemptions that were previously utilized by developers to ignore apprenticeship and health coverage mandates.
The players
Gavin Newsom
He is the current Governor of the State of California.
Berkeley City Council
This is the local legislative body responsible for passing municipal ordinances, including labor mandates for housing construction.
Laconia Development
This is a real estate development firm that has been identified for utilizing state exemptions to bypass local labor rules.
Collab Home
This is a real estate developer that used density bonus provisions to exempt a 20-story project from prevailing wage requirements.
The details
Developers previously used density bonuses to bypass local ordinances that require apprenticeship programs and health care coverage for workers on major projects. While the new law applies to large buildings, it notably does not impact the housing projects at 2029 University Ave. and 2425 Durant Ave. in Berkeley.
Timeline
A Berkeley labor mandate ordinance went into effect in 2024.
The Berkeley City Council approved two disputed housing projects earlier in 2026.
Governor Gavin Newsom signed SB 1383 into law in October 2026.
Political Context
Industry groups and some housing advocates have argued that adding labor requirements to new developments unnecessarily increases construction costs and hinders the state's housing production goals. Critics contend that these mandates effectively penalize developers who are working to increase the supply of housing in high-demand markets like Berkeley.
Residents may see fewer developers utilizing state loopholes that weaken labor standards on major high-rise construction projects. These regulations ensure that the construction of new housing in the state maintains consistent worker safety and health care benefits for local laborers.
The takeaway
This legislation marks a significant effort by the state to balance housing supply goals with the protection of local labor mandates. Residents interested in urban development should monitor how future high-rise projects adjust their planning to comply with these updated standards.
Further reading
For more on labor regulations, visit California Unions.
Source note: This article includes information reported by Construct Connect.
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