Ensuring Compliance with the California Fair Pay Act
Ensuring compliance with the California fair Pay Act is crucial for any employer with workers in San Diego or throughout California. The new California Fair Pay Act legislation took effect in January of 2016 and included several changes to the previous law. Several sections of the old California Labor Code were removed with this legislation, including an important provision that used to allow employers to adjust wages based upon work being performed “at different geographic locations” or on “different shifts or different times of the day.” While these factors alone cannot justify a differential in pay, it may be possible for you to justify these differentials if it can be proved that they are “consistent with a business necessity” as provided in the context of the updated legislation.
Ensuring compliance with the California Fair Pay Act has been placed solely on the backs of California employers. California and San Diego employers must be prepared to prove that any pay differences for “essentially the same work” are based upon the “factors” identified in last year’s update. The factors that may be used to adjust the pay for a given task include:
- A Merit System
- A Seniority System
- A System Based Upon Measured Quantity or Quality of Production, or
- A “bona fide” factor other than gender, including but not limited to education, experience or training
The “bona fide” factor exception can only be justified when a California employer can prove the factor is only “job related” and has nothing to do with gender or any other issue, and it must be consistent with a “business necessity.” It is important to note that an employer will not be able to justify the “bona fide” factor if the employee is able to show another business practice exists which serves the same business purpose without justifying the difference in pay.
If you have questions regarding your interpretation of or ensuring compliance with the California Fair Pay Act we invite you to contact the Watkins Firm for a free consultation at 858-535-1511.