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New Law to Guarantee Equal Pay in the Workplace

Governor Brown, Jr. took action this past Tuesday, October 6, 2015, signing into law SB 358 which provides for gender wage equality to the millions of working women in California. This act will amend Section 1197.5 of the California Labor Code relating to private employment.   Republicans and Democrats alike supported this bill to equalize pay for women. Governor Brown, while signing the bill stated, “sixty-six years after passage of the California Equal Pay Act, many women still earn less money than men doing the same or similar work.”  Enacting this new legislation is a step closer to bridging the compensation gap between men and women.

Today, more women than ever are bread winners for their families and their paychecks should reflect the intellect, hard work and results they bring to the workplace. Period. California is paving the way to do what is right for the 19 million women and girls who call this state their home.

Prior to SB 358, generally, women in California earned 84 cents for every dollar earned by men regardless of whether women were performing the same job, with the same level of education. (The national average was 79 cents for every dollar.)  This wage gap was across almost all occupations in California. Collectively, women working full time in California lose approximately $33 billion dollars each year due to the gender wage gap!

With the passage of SB 358, an employer must pay employees, despite their gender, the same for substantially similar work, when viewed as a composite of skill, effort and responsibility, and performed under similar working conditions. The burden then shifts to the employer to demonstrate that a differential in pay was applied reasonably based on a number of exceptions outlined in the Labor Code. The act also addresses the fact that pay secrecy contributes to the gender wage gap as women are aware of just how much they are being under paid for the same work as their male counterparts. This act makes it illegal for an employer to prohibit an employee from disclosing their own wages, discussing the wages of others for example, to unravel the secrecy surrounding compensation in the workplace.

Employers should audit their employee compensation to ensure equality amongst their employees. Unless there is a justifiable reason, such as difference in seniority, application of a merit system or other bona fide reason you may be paying a female employee less than a male employee in a substantially similar job, make sure you are paying your employees equally.

Consult with employment attorney April Glatt of Chauvel & Glatt to determine whether you are paying your employees properly under this new change in California law.


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