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California Proposes New Law Aimed at Closing Gender Pay Gap

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California Proposes New Law Aimed at Closing Gender Pay Gap

By DeAnn Chase January 02, 2018    Category: Business Law     Tags: business employment gender pay gap Law

California Proposes New Law Aimed at Closing Gender Pay Gap

Across the country, the gender pay gap debate wages and California, despite our tough fair pay laws, is no exception to this rule. Recently, two new laws, one which passed and one which didn’t, aimed to help close and better document this pay gap. According to the census bureau, the average working woman is earning only 86 cents per dollar earned by a man. While stride are being taken to close this gender pay gap, we’re clearly not there yet.

The first law, AB 168, bars a prospective employer from asking about previous salary. The goal is to prevent historic pay discrepancies from a previous job from impacting a woman’s pay in their new position. While similar laws have passed in other states, none have been around long enough to determine if preventing someone from asking about salary really impacts wage discrepancies or will improve the gender pay gap. This does not, however, prevent the applicant from bringing the topic up. If an employer makes an offer, the applicant can then proceed to negotiate the offer using any information they care to share, including salary history.

The second law, which did not pass, was aimed at making wage transparency mandatory to eliminate the gender pay gap. Many large business and federal contractors are already required to submit this information, this would preserve the measure in California in the event the US Congress reversed President Obama’s executive order. Currently, a wage gap can be justified based on experience, education, productivity, seniority, or some other merit system, but the law would require companies to document and study these gaps.

Critics of these new laws cite the situation where people are making decisions and filing gender pay gap lawsuits with only half-baked information. In many cases, the gender pay gap, particularly among college-educated individuals, exists due to a woman’s reluctance to negotiate, her choice to negotiate for flexible hours instead of increased pay, or an uneven childcare burden. None of these issues would be taken into account in the data collected. However, supporters argue back that you have to first identify where the gender pay gaps are in order to research and fix them.

There are certainly gender pay issues that need to be addressed, but determining the best way to do so is still a matter of debate. Businesses, meanwhile, can take steps to document their pay policies and ground those policies in merit-based reasons for pay scales. The team at Chase Law Group, P.C. wants to help the businesses we represent stay on top of the latest changes in legislation. If you have any questions, feel free to reach out to (310) 545-7700 to set up a consultation.