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Your Legal Corner - Client Alert Blog

California's Revised Equal Pay Law

Written By: Melissa C. Marsh, Esq., California Attorney, March 2016 Add to Favorites

California first enacted an equal pay statute in 1949. Existing law prohibited a California employer from paying women a lesser wage than the men at the same location if the two performed the same work, unless the wage differential could be justified by seniority, merit, or a system that qualitatively measured an employee’s quantity or quality of production. The existing law, however, was almost impossible to enforce because most California employees couldn't prove that an actual wage discrepancy existed.

Effective January 1, 2016, the new California Fair Pay Act (SB 358) set forth in Labor Code §1197.5, provides for wage transparency and a true means by which an employee can bring and win a wage discrimination lawsuit. The stated goal of the new legislation is to eliminate pay disparities based on gender by reducing the employee’s burden of proving a wage disparity and increasing an employers’ burden of proving there is a basis for the wage discrepancy.

To increase transparency, the California Fair Pay Act prohibits California employers from restricting their California employees from inquiring about, discussing, or disclosing their wages with and to their co-workers for the purpose of ascertaining whether there is a basis for bringing a claim for wage discrimination. As of January 1, 2016, all California employees are free to openly discuss their wages with their co-workers even if their employment agreement states otherwise.

The California Fair Pay Act also requires the employer to prove that a discrepancy in wages between male and female employees performing substantially the same work is reasonably and entirely based on specified objective factors such as: seniority, merit, or a system that qualitatively measures an employee’s quantity or quality of production.

The California Fair Pay Act also prohibits California employers from terminating, or in any other manner retaliating against, an employee who inquired about, discussed, or disclosed their wages. In the event an employee brings a successful lawsuit, the employee may receive reinstatement and damages (the amount of wages the employee was not paid due to the wage differential plus interest, reimbursement for lost wages and benefits if the employee was terminated, and statutory damages of an additional equal amount).

Finally, the bill increases the California’s employer’s duty to maintain records from 2 years to 3 years.

If you are an employer, you should immediately examine your pay rates for the same or similar jobs to see if disparities exist based on gender. If disparities exist, check to see whether they can be justified by objective factors set forth in the new law. If note, remedy the situation immediately.

Tags: California Equal Pay Act
Posted In: Employment Law News 

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Disclaimer: The information presented on this web site was prepared by Melissa C. Marsh for general informational purposes only and does not constitute legal advice. The information provided in my articles and alerts should not be relied upon, or used as a substitute for professional legal advice from an attorney you retain to advise or represent you. Your use of this Internet site does not create an attorney- client relationship. Transmission of this article is not intended to create, and receipt of it does not constitute, an attorney-client relationship. All uses of the contents of this site, other than personal uses, are prohibited. You may print or email a copy of any information posted on this web site for your own personal, non-commercial, use, but you may not publish any of the articles or posts on this web site without the Express Written Permission of Melissa C. Marsh.

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Located in Los Angeles, California, the Law Office of Melissa C. Marsh handles business law and corporation law matters as a lawyer for clients throughout Los Angeles including Burbank, Sherman Oaks, Studio City, Valley Village, North Hollywood, Woodland Hills, Hollywood, West LA as well as Riverside County, San Fernando, Ventura County, and Santa Clarita. Attorney Melissa C. Marsh has considerable experience handling business matters both nationally and internationally. We routinely assist our clients with incorporation, forming a California corporation, forming a California llc, partnership, annual minutes, shareholder meetings, director meetings, getting a taxpayer ID number (EIN), buying a business, selling a business, commercial lease review, employee disputes, independent contractors, construction, and personal matters such as preparing a will, living trust, power of attorney, health care directive, and more.