Employees looking to draw from retirement funds can now do so without penalty because of a new law written by Laura Friedman, who represents parts of Glendale and Burbank in the California Assembly.

AB 276 removes penalties for moving money out of an employer-sponsored defined contribution program, such as a 401(k). Friedman created the law to help people in the midst of the COVID-19 crisis.

Prior to the legislation, Californians faced a 10 percent penalty for an early withdrawal from a retirement plan; in that respect the California Personal Income Tax Code did not conform to the federal CARES Act, according to a statement from Friedman’s office.

“This money can be a lifeline for struggling families and every dollar counts. I’m glad that Governor Newsom agrees that they shouldn’t be burdened with penalties under California law,” Friedman added in the statement.

The bill was sponsored by the California International Alliance of Theatrical Stage Employees Council and the Entertainment Union Coalition. It passed the legislature with “broad, bipartisan support,” Friedman’s office said. The law goes into effect immediately.