A Guide to Equal Pay Laws in California

California’s Equal Pay Laws

California has one of the most progressive employment laws in the country, aimed at ensuring equality for all workers. Here is everything you need to know about equal pay laws in California.

The California Equal Pay Act was ratified in 1949 and strengthened by the California Fair Pay Act in 2015. Since the signing of the Fair Pay Act in 2015, the act has been expanded to further ensure that all workers are getting the wage they are entitled to; however, there are still ways an employer can avoid paying an equal wage.

California Fair Pay Act

Signed by Governor Brown in 2015, California’s Fair Pay Act continues to be amended in order to ensure that workers are being paid fairly for the work they do. The act requires that employees be paid the same wage for substantially similar work when skill, effort, and responsibility are the factors taken into consideration. Additionally, workers do not need to work at the same establishment in order to compare wages for similar work; thus, similar wages are guaranteed across different establishments.

Dedicated to transparency, the act allows employees to be knowledgeable about their co-workers’ earnings. If an employee has substantially similar job responsibilities as their co-worker and is being paid less, the employee can address this matter with their employer. If the employer fails to amend the situation, an employee can file a complaint with the Division of Labor Standards Enforcement. It is illegal for an employer to retaliate against an employee for asserting their right to a fair wage.

While an employee can ask about co-workers’ salaries, an employer cannot ask the employee to disclose their previous salary. Lastly, the Act requires that employers keep wages and other employment-related records for three years.

California Equal Pay Reporting

The newest amendment to California’s Fair Pay Act became effective January 1, 2021. Governor Newsom signed a bill requiring that private employers that employ 100 or more workers report pay data to the state. Reports are due yearly on March 31st and must include employees’ W-2 earnings from the previous year, along with the hours worked. In order to ensure that no wage differential is occurring due to discrimination, employers must also include information about the employees’ sex, ethnicity, and race. The Fair Pay Act requires that this information be provided for:

Executive or senior-level officials and managers
First or mid-level officials and managers
Professionals
Technicians
Sales workers
Administrative support workers
Craftworkers
Operatives
Laborers and helpers
Service workers

Fair Pay: Substantially Similar vs. Equal

In 2016, the California Fair Pay Act was amended to require that employees be paid the same wage for jobs that are “substantially similar,” rather than equal. When determining substantially similar jobs, skill, effort, working conditions, and responsibility are taken into consideration. The Fair Pay Act emphasizes responsibilities rather than job title when determining fair pay.

Exemptions to Equal Pay for Substantially Similar Work

The California Fair Pay Act establishes that workers must be paid the same wage for substantially similar work, except in situations where the difference in wage is a result of

a seniority system
merit system
a bona fide factor other than sex
or a system that pays an employee based on the quality or quantity of production.

To prove that a bona fide factor is a reason for the wage differential, an employer must prove that:

sex, race, or ethnicity do not affect the wage the employer is paying the employee
the factor is job-related
the factor is consistent with a business necessity

FAQs

Is there any law to ensure that union and non-union workers are paid the same wage for the same work?

All workers must be paid the same wage for substantially similar work regardless of whether they are a member of a union or not. An employee may not earn more for being in a union but may be offered added benefits. Such benefits include: paid sick leave, healthcare, and better working conditions. There is currently no law to guarantee that union and non-union workers have the same added job benefits.

Does California’s Fair Pay Act mean that men and women must be paid an equal amount of money?

The Fair Pay Act does not require that men and women be paid an equal wage. However, it requires that employees be paid the same wage for similar work. If a man is in a position that has different job responsibilities than the woman, then they should expect to earn different wages. A wage differential between male and female employees can legally exist if you work within a company or workplace that has a seniority or merit system, a system that pays you based on quality or quantity of work produced, or takes into consideration a bona fide factor other than sex.

Does California’s Fair Pay Act only apply to sex?

No, the California Fair Pay Act was expanded to ensure that sex, race, and ethnicity cannot be taken into consideration when determining a wage. If you or a loved one are being paid a lower wage than a co-worker who is performing similar duties because of your sex, race, or ethnicity, you can file an equal pay act complaint with the Division of Labor Standards Enforcement.

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If you or a loved one would like to know more about equal pay laws in California, get your free consultation with one of our California Employment Attorneys today!