California Fair Pay Act About to Take Effect


Sacramento, CA: On January 1, 2016, California’s Fair Pay Act, SB 358 (Jackson), will take effect. The bill will give more grounds for employees to challenge pay discrimination. In addition to addressing wage disparity, the bill is designed to prevent employers from retaliating against employees who discuss their pay.

According to the California Employment Lawyers Association (CELA), women working full time in California lose more than $33 billion annually to the wage gap, earning around 84 cents for every dollar a man earns. The statistics are even bleaker for minority women, who earn as low as 44 cents per dollar earned by white men. The California Employment Lawyers Association further argues that employers effectively prohibit or discourage employees from discussing their pay, preventing lower paid employees from fighting against pay disparity out of fear of retaliation.

Although there are existing state and federal laws that address pay inequality, those laws contain loopholes that make it easier for employers to prevent employee discussions of their pay. For example, one of the provisions in the existing California law regards wage differentials only when they occur at the same establishment, not within the same company. So a woman doing the same work as a man, for the same company but at a different office could still be paid less without breaking the law.

“Pay secrecy also contributes to the gender wage gap, because women cannot challenge wage discrimination that they do not know exists,” the bill states. “Although California law prohibits employers from banning wage disclosures and retaliating against employees for engaging in this activity, in practice many employees are unaware of these protections and others are afraid to exercise these rights due to potential retaliation.”

Revisions to the bill would mean employers would have to prove a wage differential is based not on gender but on seniority, merit, quantity or quality of production, or another legal factor other than sex. Otherwise, if men and women do substantially similar work, they must be paid the same even if their job titles and employment locations are different. Furthermore, employers would be prohibited from retaliating or discrimination against any employee who attempts to protect her rights based on the bill, and would further be prohibited from preventing employees from discussing their wages or the wages of other employees.

Employers who are found to violate the law could face legal action. The new bill could see a rise in gender pay discrimination once it takes effect.

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