BILL ANALYSIS Ó
SENATE COMMITTEE ON LABOR AND INDUSTRIAL RELATIONS
Senator Tony Mendoza, Chair
2015 - 2016 Regular
Bill No: AB 1676 Hearing Date: June 22,
2016
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|Author: |Campos |
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|Version: |June 15, 2016 |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|Gideon L. Baum |
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Subject: Employers: salary information
KEY ISSUE
Should the Legislature clarify that prior salary cannot be used
to justify any disparity in compensation between men and women?
ANALYSIS
Existing law:
1) Bars an employer from requiring an employee to refrain
from disclosing the amount of his or her wages, requiring
an employee to sign a waiver or other document that denies
the employee the right to disclose the amount of his or her
wages or discharge, or formally disciplining, or otherwise
discriminating against an employee who discloses the amount
of his or her wages. (Labor Code §232)
2) Prohibits an employer from paying an employee at wage
rates less than the rates paid to employees of the opposite
sex in the same establishment for equal work on jobs the
performance of which requires equal skill, effort, and
responsibility, and which are performed under similar
working conditions. (Labor Code §1197.5)
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3) Establishes exceptions to this prohibition where the
payment is made pursuant to a seniority system, a merit
system, a system which measures earnings by quantity or
quality of production, or a differential based on any bona
fide factor other than sex. (Labor Code §1197.5)
4) Makes it a misdemeanor for an employer or other person
acting either individually or as an officer, agent, or
employee of another person to pay or cause to be paid to
any employee a wage less than the rate paid to an employee
of the opposite sex, or who reduces the wages of any
employee in order to comply with wage protections for an
employee of the opposite sex. (Labor Code §1199.5)
This bill:
1) Clarifies that prior salary, by itself, must not justify
any disparity in compensation between workers of the
opposite sex;
2) Makes findings and declarations on the wage differential
between men and women, recent case law, and that this bill
is a codification of existing law.
COMMENTS
1. Need for this bill?
The author states the following:
"On average, California women who are employed full time lose
a total of approximately $37.7 billion every year due to the
wage gap. These lost wages mean families have less money to
spend on goods and services that help drive economic growth?
[M]others are the primary or sole breadwinners in nearly 40
percent of families, and married mothers are the primary or
co-breadwinners in nearly two-thirds of families. That means
women's wages are key to their families' ability to make ends
meet and get ahead.
The pay gap begins early in women's careers. According to a
study by the American Association of University Women, women
one year out of college, working full time, were paid on
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average just 82 percent of what their male counterparts make.
This number shows that there is still a significant wage gap
when accounting for age, education and family
responsibilities.
According to a recent report from the Institute for Women's
Policy Research, the gender wage gap in the United States will
not close until 2058 if progress continues at its current
rate. But perhaps our slow rate of progress is due at least in
part because we have allowed employers to preserve historical
inequities.
Because changing jobs is often the best opportunity women have
to increase their pay, we need to make sure they are not
penalized by prior salaries that may well have been
discriminatory. The impact of prior salaries is particularly
concerning in certain industries and across racial lines. For
example, women in Silicon Valley with advanced degrees are
making more than 70 percent less than men with the same
degrees. And California has one of the largest wage gaps for
African American and Hispanic women, who make just 64 and 44
cents, respectively, for every $1 a white man makes. These
depressed salaries only serve to devalue a woman's worth and
make it harder for her to negotiate better pay."
AB 1676 addresses the pay gap by making findings and
declarations and clearly stating that prior compensation
cannot be used to justify any disparity in compensation.
2. Proponent Arguments :
Proponents argue AB 1676 is an important measure to continue
previous legislative efforts to bridge the wage gap between
male and female workers. Specifically, proponents note that,
last year, the Legislature passed SB 358, which requires that
men and women doing substantially similar work under similar
working conditions be paid equally, barring certain factors.
The practice of paying someone solely based on their prior
salary was not specifically addressed, recent administrative
court decisions have made clear this is discriminatory and
locks in a low level of pay for many women. AB 1676 addresses
this by making explicit and clear that paying someone less on
the basis of a prior salary is discriminatory.
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3. Opponent Arguments :
None on file.
4. Double Referral:
This bill has been double-referred and, if approved by this
committee, it will be sent to the Senate Judiciary Committee
for a hearing.
5. Prior Legislation :
SB 358 (Jackson), Chapter 546, Statutes of 2015, requires that
men and women doing substantially similar work under similar
working conditions be paid equally, unless the employer can
demonstrate that the pay differential is based on certain
enumerated factors.
SUPPORT
California Employment Lawyers Association (Sponsor)
Alliance of Californians for Community Empowerment
American Association of University Women
California Asset Building Coalition
California Child Care Resource and Referral Network
California Domestic Workers Coalition
California Employment Lawyers Association
California Latinas for Reproductive Justice
California Partnership
California Women's Law Center
California Work and Family Coalition
Child Care Law Center
Courage Campaign
Equal Rights Advocates
Legal Aid Society Employment Law Center
Mujeres Unidas y Activas
National Association of Social Workers-California Chapter
National Council of Jewish Women
Parent Voices
Raising California Together
Santa Barbara Women's Political Committee
Santa Clara County board of Supervisors
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The Center for Popular Democracy
The Opportunity Institute
The Women's Foundation of California
Tradeswomen, Inc.
Voices for Progress
Western Center on Law and Poverty
9 to 5 California
OPPOSITION
None received.
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