2017: Equal Pay Claims under California Law – Where are We Now?

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To recap the current state of gender pay equity under California law: California’s Fair Pay Act went into effect on Jan. 1, 2016.  For the first time, a “full court press” effort was made by the legislature, to bar California employers from paying workers of one sex more than the workers of the opposite sex.  Last January, the Equal Pay Act was changed to utilize the “substantially similar” standard when comparing work done by employees, and the bill added heavy fines for any employers who continued to do so.  The exceptions were tightened to force employers to essentially prove that any pay gap between workers of the opposite sex in the same job was justified by a “bona fide factor other than sex.”  Employers must demonstrate such pay gaps to be the result of one or more of the following:

(A) A seniority system.

(B) A merit system.

(C) A system that measures earnings by quantity or quality of production.

The 2016 law was designed to close the pay gap between men and women in similar jobs, and applies to all California employers, regardless of size.

On January 1, 2017, the law was improved upon, expanding the principles of the Fair Pay Act to include compensation differences between members of one race or ethnicity and those of another. It was argued that women of color should be able to file claims under the law for discrepancies in pay due to race.

The law is still fairly new.  Claims made are sporadic, with many women not yet realizing that they have this tool to further their careers.  Those who do are often unsure as to how to find out what their co-workers are making.  Many are unaware that asking fellow workers for salary information is now a protected activity, meaning that it is unlawful for an employer to retaliate with firing, demotion or other adversary action if they learn an employee was asking about the salary of others.  An employee is also entitled to ask the employer.  Unfortunately, at this point, the law does not compel the employer to respond with the desired information.

In 2016, the EEOC pursued a number of issues, including Equal Pay. They are, in descending order:

  • Retaliation: 42,018 (45.9 percent of all charges filed)
  • Race: 32,309 (35.3 percent)
  • Disability: 28,073 (30.7 percent)
  • Sex: 26,934 (29.4 percent)
  • Age: 20,857 (22.8 percent)
  • National Origin: 9,840 (10.8 percent)
  • Religion: 3,825 (4.2 percent)
  • Color: 3,102 (3.4 percent)
  • Equal Pay Act: 1,075 (1.2 percent)
  • Genetic Information Non-Discrimination Act: 238 (.3 percent)

NOTE: The percentages add up to more than 100 because some charges allege multiple bases

 

In 2017, the EEOC plans to focus on ensuring Equal Pay protections for all workers, by focusing on compensation systems and practices that discriminate based on any protected basis.”  How effectively that will supplement California’s new law in terms of national equal pay progress remains to be seen.

So, women in the workforce, take note. You have new tools at your disposal to level the playing field.

 

THE TAKE AWAY

  • You may ask co-workers and employers about the salaries of your co-workers. Whether you are trying to establish a disparity in pay due to gender or race — asking the question is protected under the law;
  • In addition to gender based pay disparity, California’s Fair Pay law now includes pay disparity protection for women of color who feel they may be paid less than their female co-workers of a different ethnicity;
  • The Fair Pay Act explicitly prohibits an employer from justifying an otherwise unlawful difference in pay on an employee’s or applicant’s prior salary alone;
  • The statutory penalties for such disparity in pay are calculated at double the difference, to include the period going back over the past two (2) years, or three (3) years if the employee can prove the differential was willful on the part of the employer;
  • The amended Act specifically prohibits an employer from retaliating against an employee for “any action taken by the employee to invoke or assist in any manner” with the enforcement of the Equal Pay Act.
  • The text of the 2016 Fair Pay Act can be found here; and the 2017 amendments can be found here

If you believe you are currently being paid less than you should be under the law, call an employment attorney now.

Lazear Mack, LLP
Employment Law Attorneys
436 14th Street, Suite 1117
Oakland, CA

510-735-6316

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