In January 2016, SB 358, the amended version of the California Equal Pay Act, took effect. The California Equal Pay Act requires all California employers pay the same wage to employees who perform “substantially similar work” the same wage regardless of gender, ethnicity or race. Under this law, employers are also required to provide an applicant with a pay scale for a position following a “reasonable request.” Finally, it prohibits employers from requesting an applicant’s prior salary history and from relying on an applicant’s salary history alone to justify a disparity in compensation “based on sex, race or ethnicity.”
Following the effective date of the amended California Equal Pay Act, the California Commission on the Status of Women and Girls launched a Pay Equity Task Force tasked with the responsibility of monitoring the implementation of the new law. Recently, this task force issued written guidance for employees, employers and unions on how they may comply with the California Equal Pay Act.
The guidance provides tips and recommended practices on how best to comply with the California Equal Pay Act, including:
- Conducting regular reviews of job descriptions and updating those job descriptions when necessary to ensure they accurately reflect a position’s duties and responsibilities;
- Educating managers on the factors they may rely upon in making decisions regarding an employee’s compensation;
- Documenting all compensation decisions – including
- The reasons why the decision wage made
- The reasons for any differences in compensation for employees; and
- Conducting periodic audits of employee compensation levels so that an employer can identify any pay disparities (i.e. substantial differences in wages amongst employees who perform substantially the same work) and make any necessary adjustments.
It is recommended that California employers review these guidance materials.