California requires employers to file equal pay reports

California requires employers to file equal pay reports

Private sector employers with 100 or more employees will have to file a report covering pay data and hours worked for the categories of gender, race and ethnicity. The first reports — based on 2020 pay data — must be filed with the California Department of Fair Employment and Housing by March 31, 2021, and thereafter by the same date annually. The measures feature in Senate Bill No. 973 signed by the governor on Sept. 30, 2020 and effective on Jan. 1, 2021. The bill aims to reduce the pay gap for women and people of color. 

Highlights

  • Employers must provide pay data for 10 job categories by race, ethnicity and gender, covering all individuals in each job category during a single period between Oct. 1 and Dec. 31 of the applicable reporting year. The categories follow the former federal Component 2 of the Equal Employment Opportunity–1; in 2019, the Equal Employment Opportunity Commission halted the controversial collection of this extensive information about employee compensation and hours worked.
  • Employer must set out the annual total earnings and hours for all employees, and the report must be in a searchable format.
  • The amount of pay must be categorized into pay bands established by the US Bureau of Labor Statistics in the Occupation Employment Statistics Survey.
  • Employers must submit a report for each establishment maintained, and a consolidated report covering all employees.
  • The law doesn’t clarify if non-California employees must be included in the report. 

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Fiona Webster
by Fiona Webster

Principal, Mercer’s Law & Policy Group

Stephanie Rosseau
by Stephanie Rosseau

Principal, Mercer’s Law & Policy Group

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