Once again California is attempting to address the U.S. gender pay gap, this time by passing SB 973 Pay Data Report, which will require employers to report annual pay and hours worked data by job category, and, by race, ethnicity and sex. Employers with 100 or more employees (and who must file an EEO-1) must now also provide pay data to the state by March 31, 2021 and annually thereafter. (Whilst the U.S. Equal Employment Opportunity enforces the EEO-1, the California Department of Fair and Employment Housing (DFEH) will be the enforcement agency for Pay Data Reporting).
To some employers this may seem like an additional reporting burden, however, it is important to keep in mind that this is a necessary requirement as gender pay inequality is still a prevalent issue and results in billions of dollars in lost wages for women each year in California.
Past approaches have been made by California to even out the playing field such as:
- Laws that prohibit employers from enforcing pay secrecy
- Laws that ban employers from asking potential hire about past earnings
Unfortunately these legislative attempts to equate pay came with their own array of unforeseen setbacks for women as described in Gender Pay Gap: Changing the Narrative.
It is worth noting that with any movement, setbacks are to be expected and progress is gradual, not immediate. The bigger picture is that progress is still being made with the each legislative attempt. SB 973 brings awareness and accountability to pay discrepancy and requires employers to start looking closer at their compensation practices as being equitable or not.
To read more about reporting requirements, please visit the California Department of Fair Employment and Housing website at https://www.dfeh.ca.gov/paydatareporting/
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