Will California’s equal pay law be amended to include race? California employers should already be familiar with the state’s Fair Pay Act, which prohibits them from paying employees lower wages than employees of the opposite gender who perform substantially similar work. The law, which took effect on January 1, 2016, is considered the strictest of its kind in the nation.
Racial disparities may soon be prohibited, in addition to gender disparities. State Senator Isadore Hall has introduced legislation that applies similar prohibitions with regards to race. If Senate Bill No. 1063 becomes law, an employer may not pay employees lower rates than employees of other races or ethnicities for performing substantially similar work – with certain exceptions.
The Bill’s Specifications
The bill does not state that all employees must receive the same salaries paid to colleagues of other races that hold the same position. Rather, it prohibits employers from paying their employees lower salaries than other employees of other races or ethnicities performing substantially similar work (when viewed as a composite of skill, effort, and responsibility), unless an employer can demonstrate a valid reason for the wage differential.
If you are wondering what would be considered a valid reason, the legislation provides guidance. Racial wage disparities would not be in violation if an employer can show that they are based on either:
- A seniority system
- A merit system
- A system based on the quantity or quality of an employee’s production, or
- A bona fide factor other than race or ethnicity.
The legislation also specifies that a factor will only be considered bona fide if it is not related to race or ethnicity, if it is related to the employee’s particular job, and if it is “consistent with a business necessity.” Also, if the employee who is making a complaint can show that there is a different practice that would satisfy the business necessity without a racial pay disparity, then the factor will not be considered bona fide.
The bill gives examples of the types of factors that could qualify. These include education, training and experience.
What Would Happen to Employers Who Violate the Equal Pay Law?
Employers who violate the law would be liable for damages to employees who have been affected by the wage disparities. They would be required to pay the employees for their lost wages, along with interest, and an additional equal amount of liquidated damages.
The legislation also specifies that an employee who is entitled to these damages would also be entitled to compensation for the costs of their suit, and reasonable attorney’s fees. In order to recover damages under a civil action, the action must be commenced within two years of when the discrimination occurs – unless there has been a willful violation, in which case the action must be commenced within three years. [Read more…]