In late August, California legislators advanced Senate Bill 358 which aimed to further close gender pay gaps in California. Considered one of the strongest proposed equal pay laws in the nation, Governor Brown indicated he would support SB 358, known as the California Fair Pay Act. The bill was presented to Governor Brown for signing in early September. Over a month after SB 358 was placed onto Governor Brown’s desk, on October 6, 2015, Governor Brown signed the bill into law. The SB 358 amends Section 1197.5 of the California Labor Code and requires that an employer “not pay any of its employees at wage rates less than the rates paid to employees of the opposite sex for substantially similar work, when viewed as a composite of skill, effort, and responsibility, and performed under similar working conditions.” For an in-depth discussion of the California Fair Pay Act’s provisions, please visit Hunton & Williams LLP’s previous blog post.
The new law will take effect on January 1, 2016. Employers should use this time to ensure employee records are properly maintained and up-to-date, especially since Section 1197.5 requires employers to maintain records of wages and wage rates, including job classifications, and other records related to employees’ terms and conditions of employment for at least three years. Employers should also ensure job descriptions are accurate and should review employees’ compensation for any irregularities between compensation rate and similar job duties.