Amended in Senate September 2, 2015

Amended in Senate August 31, 2015

Amended in Senate July 7, 2015

Amended in Assembly June 1, 2015

California Legislature—2015–16 Regular Session

Assembly Bill No. 1354

Introduced by Assembly Member Dodd

(Coauthors: Assembly Members Bonilla, Bonta, Chávez, Cooper, Eggman, Cristina Garcia, Gonzalez, and Lopez)

(Coauthors: Senators Allen, Block, Galgiani, Hall, Hancock, Leyva, Mitchell, and Wolk)

February 27, 2015

An act to amend Section 12990 of the Government Code, relating to discrimination.

LEGISLATIVE COUNSEL’S DIGEST

AB 1354, as amended, Dodd. Discrimination: equal pay: state contracting.

Existing law subjects an employer who is, or wishes to become, a contractor with the state for public works, or for goods or services, to various nondiscrimination requirements. Existing law authorizes requiring an employer to submit a nondiscrimination program to the Department of Fair Employment and Housing for approval and certification, prior to becoming a contractor or subcontractor with the state, as well as requiring the provision of periodic reports of contractor or subcontractor compliance with that program.

This bill would enact the Equal Pay for Equal Work Act of 2015. The bill would require an employer with 100 or more employees begin insert in state, as specified, end insert and a contract of 30 days or more, prior to becoming a contractor or subcontractor with the state, to submit a nondiscrimination program to the Department of Fair Employment and Housing and to submit periodic reports no more than annually of its compliance with that program. The bill would authorize the department to require approval and certification of the program. The bill would permit the department to require an employer with fewer than 100 employees begin insert in state end insert or a contract of less than 30 days to submit a nondiscrimination report. The bill would require the department to define an employee for these purposes. The bill would require the nondiscrimination program to include policies and procedures designed to ensure equal employment opportunities for all applicants and employees, an analysis of employment selection procedures, and a workforce analysis, as specified. The bill would specify that its provisions are not to be construed to negate certain exemptions established by regulation that predate its enactment or to require the department to reevaluate the validity of these exemptions, as specified. The bill would make a statement of legislative findings.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

This act shall be known, and may be cited, as the
Equal Pay for Equal Work Act of 2015.

SEC. 2.  

(a) The Legislature finds and declares the following:

(1) According to data from the United States Census Bureau,
full-time working women, on average, over the last decade, have
continued to earn just 77 cents for every dollar a man earns. The
wage gap is greater for women of color, with African American
women being paid an average of 64 cents for every dollar paid to
white, non-Hispanic men in 2013 and Latinas being paid just 56
cents for every dollar paid to white, non-Hispanic men.

(2) This wage disparity amounted to a yearly average wage gap
of $10,876 in 2013 between full-time working men and full-time
working women. In total, the disparity represents more than $490
billion in lost wages for working women every year.

(3) Disparities in pay for women have numerous negative
impacts. This pay differential shortchanges women and their
families by thousands of dollars a year and potentially hundreds
of thousands of dollars over a lifetime. Nearly 4 in 10 mothers are
primary breadwinners in their households, and nearly two-thirds
are significant earners, making pay equity critical to the economic
security of their families.

(4) Equal pay for equal work is a fundamental precept in our
nation and in California. Federal law, including the federal Equal
Pay Act of 1963 (Public Law 88-38), Title VII of the Civil Rights
Act of 1964 (Public Law 88-352), and Executive Order 11246 of
September 24, 1965, entitled Equal Employment Opportunity,
specifically prohibits arbitrarily compensating men and women
differently for the same work, as does California’s Equal Pay Act.

(5) On August 6, 2014, the United States Department of Labor’s
Office of Federal Contract Compliance Programs issued a notice
of proposed rulemaking to required covered federal contractors
and subcontractors with more than 100 employees to submit an
annual equal pay report on employee compensation. In California,
state contractors receiving public money are obligated to comply
with equal pay laws and should provide the state with aggregate
wage data to advance pay equity.

(b) It is the intent of the Legislature in enacting this act to
promote pay equity and nondiscrimination in setting pay and
making hiring or promotional decisions, and to obtain better data
on pay equity to more wholly address the problem.

SEC. 3.  

Section 12990 of the Government Code is amended
to read:

12990.  

(a) Any employer who is, or wishes to become, a
contractor with the state for public works or for goods or services
is subject to the provisions of this part relating to discrimination
in employment and to the nondiscrimination requirements of this
section and any rules and regulations that implement it.

(b) (1) (A)  begin insert (i) end insert begin insert   end insert Prior to becoming a contractor or subcontractor
with the state, an employer with 100 or more employees begin insert in the
state end insert and a contract of 30 days or more shall submit a
nondiscrimination program to the department and shall submit
periodic reports, no more than annually, of its compliance with
that program. An employer with fewer than 100 employees begin insert in the
state end insert or a contract of less than 30 days may be required to submit
a nondiscrimination program and, if so required, shall comply with
the requirements for employers with 100 or more begin delete employees. end delete
begin insert employees in the state. end insert The department may require approval and
certification of a nondiscrimination program. The department shall
define an employee for the purposes of this paragraph.

begin insert

(ii) An employee in the construction industry covered by a valid
collective bargaining agreement that expressly provides for the
wages, hours of work, and working conditions of employees,
premium wage rates for all overtime worked, and regular hourly
pay of not less than 30 percent of the state minimum wage rate
shall be excluded from calculation of the employer’s total number
of employees for purposes of this subparagraph.

end insert

(B) The changes made to this subdivision made by the act adding
this subparagraph shall not be construed to negate an exemption
to the requirements of this section in existence on January 1, 2016,
created by the department through the exercise of its regulatory
authority, or to otherwise require the department to reinterpret the
validity of an exemption as a result of these changes.

(2) A nondiscrimination program shall include policies and
procedures designed to ensure equal employment opportunities
for all applicants and employees, an analysis of employment
selection procedures, and a workforce analysis. The workforce
analysis shall include the following:

(A) The total number of workers with a specific job category
identified by worker race, ethnicity, and sex.

(B) Total wages required to be reported on Internal Revenue
Service Form W-2 for all workers in a specific job category
identified by worker race, ethnicity, and sex.

(C) The total hours worked on an annual basis for all workers
in a specific job category identified by worker race, ethnicity, and
sex. Exempt employees shall be presumed to work 40 hours a week
for purposes of this reporting requirement.

(c) Every state contract and subcontract for public works or for
goods or services shall contain a nondiscrimination clause
prohibiting discrimination on the bases enumerated in this part by
contractors or subcontractors. The nondiscrimination clause shall
contain a provision requiring contractors and subcontractors to
give written notice of their obligations under that clause to labor
organizations with which they have a collective bargaining or other
agreement. These contractual provisions shall be fully and
effectively enforced. This subdivision does not apply to a credit
card purchase of goods of two thousand five hundred dollars
($2,500) or less. The total amount of exemption authorized herein
shall not exceed seven thousand five hundred dollars ($7,500) per
year for each company from which a state agency is purchasing
goods by credit card. It shall be the responsibility of each state
agency to monitor the use of this exemption and adhere to these
restrictions on these purchases.

(d) The department shall periodically develop rules and
regulations for the application and implementation of this section,
and submit them to the council for consideration and adoption in
accordance with the provisions of Chapter 3.5 (commencing with
Section 11340) of Part 1. Those rules and regulations shall describe
and include, but not be limited to, all of the following:

(1) Procedures for the investigation, approval, certification,
decertification, monitoring, and enforcement of nondiscrimination
programs.

(2) The size of contracts or subcontracts below which any
particular provision of this section shall not apply.

(3) The circumstances, if any, under which a contractor or
subcontractor is not subject to this section.

(4) Criteria for determining the appropriate plant, region,
division, or other unit of a contractor’s or subcontractor’s operation
for which a nondiscrimination program is required.

(5) Procedures for coordinating the nondiscrimination
requirements of this section and its implementing rules and
regulations with the California Plan for Equal Opportunity in
Apprenticeship, with the provisions and implementing regulations
of Article 9.5 (commencing with Section 11135) of Chapter 1 of
Part 1, and with comparable federal laws and regulations
concerning nondiscrimination, equal employment opportunity,
and affirmative action by those who contract with the United States.

(6) The basic principles and standards to guide the department
in administering and implementing this section.

(e) Where a contractor or subcontractor is required to prepare
an affirmative action, equal employment, or nondiscrimination
program subject to review and approval by a federal compliance
agency, that program may be filed with the department, instead of
any nondiscrimination program regularly required by this section
or its implementing rules and regulations. Such a program shall
constitute a prima facie demonstration of compliance with this
section. Where the department or a federal compliance agency has
required the preparation of an affirmative action, equal
employment, or nondiscrimination program subject to review and
approval by the department or a federal compliance agency,
evidence of such a program shall also constitute prima facie
compliance with an ordinance or regulation of any city, city and
county, or county that requires an employer to submit such a
program to a local awarding agency for its approval prior to
becoming a contractor or subcontractor with that agency.

(f) Where the department determines and certifies that the
provisions of this section or its implementing rules and regulations
are violated or determines a contractor or subcontractor is engaging
in practices made unlawful under this part, the department may
recommend appropriate sanctions to the awarding agency. Any
such recommendation shall take into account the severity of the
violation or violations and any other penalties, sanctions, or
remedies previously imposed.