Legislators in California approved a measure that requires employers to include salary ranges with job postings in the state in order to encourage pay equity.
The bill, SB 1162, “would require an employer with 15 or more employees to include the pay scale for a position in any job posting” and “would require businesses to include median and mean hourly rates for each combination of race, ethnicity, and sex within each job category” in their pay data reports to the state.
If California Governor Gavin Newsom signs the legislation before September 30, 2022, it will become a law in the state. Newsom has not expressed an opinion on the bill.
SB 1162 is similar to a Colorado law passed to deal with salary disparities. The Equal Pay for Equal Work Act was approved by Colorado in 2019, and regulations were made to put the law into effect in 2021. Employers like Digital Ocean, however, have skirted Colorado’s regulations by excluding residents from certain positions.
If California passes SB 1162, it might be more difficult to maintain such defiance.
In an interview, Wendy Musell, managing partner of the law firm Wendy Musell and counsel for the employment-law expert’s Levy Vinick Burrell Hyams LLP, predicted that if California adopts these regulations, salary ranges will appear more frequently in job postings.
Musell, a former chair of the California Employment Lawyers Association, a group that supported the legislation, predicted that if it passed, there would be an increase in the number of job postings that included the salary range. Additionally, it will enable current employees to request the salary range for their position.
The legislation, according to her, ” is a major step toward pay equality but also equal opportunity.”
Even after a provision that would have made all pay data public was removed, the bill is still opposed by the California Chamber of Commerce, a lobbying organization for business. The group argues that the bill’s private right of action to sue non-compliant businesses, even when the transgression was the failure to disclose salary information from a third-party job website, makes the salary range disclosure requirement “difficult, if not impossible,” to put into practice.
The group also takes issue with the administrative burden and record-keeping requirements associated with mandating that employers post all opportunities for promotion.
To reduce unequal pay, the bill’s salary disclosure, and record-keeping requirements. Household median income by race and ethnicity also varies significantly, with women earning 83 cents for every dollar earned by men in 2020, according to the US Census Bureau.
A pay equity bill that has been approved by the New York State legislature is also awaiting Kathy Hochul’s signature.