California: New Law Imposes Pay Data Reporting Requirements on Large Employers

APPLIES TO

All Employers of 500+ CA Employees

EFFECTIVE

July 1, 2019

QUESTIONS?

Contact HR On-Call

(888) 378-2456

UPDATE (10/23/17) – Although passed by the California State Legislature, this law was not signed by Governor Brown and therefore did not go into effect. Look for additional updates on this topic. 

While the Trump Administration has indefinitely blocked implementation of the EEO-1 form section that would have required reporting employee pay data, California has gone a step further in requiring employers to report information about gender wage differentials.  Effective July 1, 2019 and biennially thereafter, Labor Code Section 2810.6 will require employers of 500 or more CA employees to collect and report specific demographic and wage disparity information.

The types of data that must be collected are:

  1. The difference between the mean wages of male exempt employees and female exempt employees located in California, by each job classification or title.
  2. The difference between the median wages of male exempt employees and female exempt employees located in California, by each job classification or title.
  3. The difference between the mean wages of male board members and female board members located in California.
  4. The difference between the median wages of male board members and female board members located in California.
  5. The number of employees used for the determination of items #1 and #2.

This information must be reported on a new form to be developed by the Secretary of State.  The first reporting deadline will be July 1, 2020 for the 2019 year of data.  The reported information will be published online.

Notably, the new law specifies that the presence of a wage differential identified in this data does not necessarily count as an immediate violation of the Fair Pay Act.  Employers will still have the ability to demonstrate if there is basis for the wage differential as specified in Labor Code Section 1197.5.

Action Items

  1. Read the text of the bill here.
  2. Implement procedures for collecting and recording wage differential and demographic information beginning July 1, 2019.
  3. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

© 2017 ManagEase, Incorporated.

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