BILL ANALYSIS                                                                                                                                                                                                    ”



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          ASSEMBLY THIRD READING


          AB  
          1890 (Dodd)


          As Amended  May 31, 2016


          Majority vote


           ------------------------------------------------------------------ 
          |Committee       |Votes|Ayes                  |Noes                |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |----------------+-----+----------------------+--------------------|
          |Labor           |6-0  |Roger HernŠndez, Chu, |                    |
          |                |     |Linder, McCarty,      |                    |
          |                |     |O'Donnell, Thurmond   |                    |
          |                |     |                      |                    |
          |----------------+-----+----------------------+--------------------|
          |Appropriations  |15-5 |Gonzalez, Bloom,      |Bigelow, Gallagher, |
          |                |     |Bonilla, Bonta,       |Jones, Obernolte,   |
          |                |     |Calderon, Chang,      |Wagner              |
          |                |     |Daly, Eggman, Eduardo |                    |
          |                |     |Garcia, Roger         |                    |
          |                |     |HernŠndez, Holden,    |                    |
          |                |     |Quirk, Santiago,      |                    |
          |                |     |Weber, Wood           |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |
           ------------------------------------------------------------------ 


          SUMMARY:  Enacts the Equal Pay for Equal Work Act of 2016,  
          related to state contracting, as specified.  Specifically, this  








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          bill:  


          1)Provides that an employer with 100 or more employees in the  
            state and a contract with the state of 30 days or more shall  
            submit a description of its nondiscrimination program to the  
            Department of Fair Employment and Housing (DFEH), and shall be  
            required to submit periodic reports (no more than annually) of  
            its compliance with that program.


          2)Specifies that an employer with fewer than 100 employees or a  
            contract of less than 30 days may be required to submit a  
            nondiscrimination program.


          3)Provides that 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.


          4)Specifies that the workforce analysis shall include the  
            following:


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


             b)   The 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  








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               reporting requirement.


          5)Provides that an employee in the construction industry covered  
            by a valid collective bargaining agreement shall be excluded  
            from the calculation of the employer's total number of  
            employees for purposes of the nondiscrimination program  
            requirement.


          6)Specifies that this bill shall not be construed to negate  
            exemptions to specified requirements in existence on January  
            1, 2017, as specified.


          7)Make related legislative findings and declarations.


          FISCAL EFFECT:  According to the Assembly Appropriations  
          Committee, the DFEH estimates General Fund administrative costs  
          of approximately $350,000 to collect and store nondiscrimination  
          program information and process anticipated Public Record Act  
          requests.  In addition, this bill would result in significant  
          General Fund cost pressures, potentially in the millions of  
          dollars annually, to the extent DFEH choses to require approval  
          and certification of contractors' nondiscrimination programs.  


          COMMENTS:  According to the author, this bill seeks to compile  
          data on gender wage inequity among state contractors and ensure  
          state contractors have policies for preventing unlawful  
          discrimination.


          Supporters argue that pay secrecy and the lack of robust and  
          reliable data on employee compensation impede our ability to  
          effectively enforce our equal pay laws.  In 2014, to address  
          this lack of data, President Barack Obama directed the Secretary  
          of Labor to require federal contractors to submit data on  








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          employee compensation.  Under the terms of the proposed rule,  
          companies that have more than 100 employees and hold federal  
          contracts or subcontracts worth $50,000 or more for at least 30  
          days would have to submit an annual Equal Pay Report on employee  
          compensation to the Office of Federal Contract Compliance  
          Programs (OFCC).


          Supporters note that California has a similar nondiscrimination  
          reporting program under the Fair Employment and Housing Act.   
          The Nondiscrimination and Compliance Employment Program is a set  
          of specific and result-oriented procedures to which a contractor  
          or subcontractor commits itself to ensure equal employment  
          opportunity for all employees or applicants for employment.


          Supporters state that this bill aims to achieve the same goal as  
          the 2014 Presidential Memorandum - to help employers take  
          proactive measures to ensure fair pay for their employees.  
          Simply compiling the data will prompt some businesses to make  
          necessary changes.


          This bill is substantially similar to AB 1354 (Dodd) of 2015.   
          AB 1354 was vetoed by Governor Brown.




          Analysis Prepared by:                                             
                          Ben Ebbink / L. & E. / (916) 319-2091  FN:  
          0003087















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