Employers in California are required to post salary ranges on their job postings under state law aimed at addressing pay inequality for women and minority groups.
The law also newly requires employers to disclose wage ranges for their jobs to existing employees when requested. Businesses must also report new salary and wage data to state civil rights offices.
“Studies show that men are more likely to ask for more money than women when there is no salary range,” said Jahan Sagafi, an employment attorney in San Francisco.
“Knowing what salary range is going to be in a salary negotiation helps applicants, especially women and people of color, negotiate a fair wage,” he said. “If we can start negotiations with equal access to information and the same understanding of what work pays for, we may have a fairer outcome based on merit rather than emotions, anger and biases based on trust in negotiations.” I have.”
“We will not stop working to ensure that every woman in our state is paid what they deserve,” Newsom said in a statement last week, calling for “new transparency to tackle the pay gap.” He praised it and signed Senate Bill 1162 into law.
The data filed showing possible wage discrimination could “definitely” lead to legal action against employers by state officials, said Shade Skahan, an employment attorney in Los Angeles.
Wage disparities based on gender and ethnicity are persistent problems across the state. Across California, the 2020 pay gap will cost women tens of billions of dollars, creating the worst inequality among women of color. according to reports From Trusaic, a software company that supports the bill and helps companies address the gender pay gap.
Last week, HP Enterprise agreed to pay $8.5 million To settle a lawsuit alleging that female employees in California were paid less than their male counterparts. Mountain View digital advertising giant Google in June agreed to pay $118 million Resolve a class action lawsuit over an alleged gender pay gap. Computer chip giant Intel in Santa Clara in 2019 agreed to pay $5 million To resolve federal charges of pay discrimination against female, African American, and Latino employees.
Under the new law, companies with 15 or more employees must include a salary range in their job postings. Employers don’t have to stay within the limits, but in other jurisdictions like New York City, Colorado and Washington, which have similar laws, paying below the floor isn’t a problem, Sagafi said. increase.
This is “probably because disclosing the range makes it easier for employees (employers) to police, and going below the range is plainly dishonest and companies are less likely to do so.” Worker.
However, Employment Lawyer Skahan, who Seyfarth Shaw usually represents for employers, said that if “the employee’s qualifications do not guarantee the pay scale specified for the position,” companies would not hire people below the wage range. I said I could hire you.
With the new law, California will become the largest U.S. state to require the disclosure of pay scales in job postings, Skahan added.
Fines for violating the new law range from $100 to $10,000 per violation. Penalties are waived for the first offense if the employer indicates that all open job listings have been updated to include pay scales.
Many companies with 100 or more employees were already required to submit non-public payroll data reports to state officials. This includes the number of employees (within job types and salary ranges) by race, ethnicity, and gender. According to the law, average hourly wages “for each combination of race, ethnicity, and gender within each occupation.”
And for the first time, businesses that employ more than 100 “employees hired through labor contractors” will be required to report the wages of those workers, with the same detailed reporting required for direct employees, including hourly wages. A breakdown must be provided.
Expanded data collection will help state agencies identify patterns of pay inequality, and for employers, “just compiling the data reveals previously hidden pay gaps,” Sagafi said. said Mr.
The bill originally required disclosure of companies’ salary data, but that provision was removed after employers objected, and Seyfarth Shaw testified before the legislative committee on behalf of business lobby group CalChamber.the group had strongly opposed such disclosure This is based on the fact that the data do not reflect varying qualification levels within a broad range of occupations, which may give a false impression of fraud.
The law will take effect on January 1st, with salary disclosures scheduled for May 10th.
https://www.dailynews.com/2022/10/04/employers-must-post-salary-ranges-under-new-california-law/ Employers must post salary ranges under new California law – Daily News