Do you run your own payroll? or have a payroll service providing the services?
Employer contributions to employee HSAs are a business expense and are tax deductible to the employer for federal tax purposes.
Also employer contributions to employee HSAs are exempt from Social Security taxes, Medicare taxes and Federal Unemployment Insurance taxes.
The taxable portion (contribution by employer to HSA account) will be reported on Form W-2 (Box 12 with code W). This will be added to the adjusted gross income by the employee when filing the CA State tax return.
Here is a link to the CA income tax instructions-