BILL NUMBER: SB 358	CHAPTERED
	BILL TEXT

	CHAPTER  546
	FILED WITH SECRETARY OF STATE  OCTOBER 6, 2015
	APPROVED BY GOVERNOR  OCTOBER 6, 2015
	PASSED THE SENATE  AUGUST 31, 2015
	PASSED THE ASSEMBLY  AUGUST 27, 2015
	AMENDED IN ASSEMBLY  JULY 9, 2015
	AMENDED IN SENATE  MAY 12, 2015
	AMENDED IN SENATE  MAY 5, 2015
	AMENDED IN SENATE  APRIL 6, 2015

INTRODUCED BY   Senator Jackson
   (Coauthors: Senators Glazer, Hall, Hancock, Hernandez, Leno,
Mitchell, and Pavley)
   (Coauthors: Assembly Members Chávez, Chu, Dodd, Cristina Garcia,
Eduardo Garcia, Gonzalez, Roger Hernández, Rodriguez, and Weber)

                        FEBRUARY 24, 2015

   An act to amend Section 1197.5 of the Labor Code, relating to
private employment.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 358, Jackson. Conditions of employment: gender wage
differential.
   Existing law regulates the payment of compensation to employees by
employers and prohibits an employer from conditioning employment on
requiring an employee to refrain from disclosing the amount of his or
her wages, signing a waiver of the right to disclose the amount of
those wages, or discriminating against an employee for making such a
disclosure.
   Existing law generally 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. Existing law establishes exceptions to that 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. Existing law 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 as
required by these provisions, or who reduces the wages of any
employee in order to comply with these provisions.
   This bill would revise that prohibition to eliminate the
requirement that the wage differential be within the same
establishment, and instead would prohibit an employer from paying any
of its employees at wage rates less than those paid to employees of
the opposite sex for substantially similar work, when viewed as a
composite of skill, effort, and responsibility, as specified. The
bill would revise and recast the exceptions to require the employer
to affirmatively demonstrate that a wage differential is based upon
one or more specified factors, including a seniority system, a merit
system, a system that measures earnings by quantity or quality of
production, or a bona fide factor other than sex, as specified. The
bill would also require the employer to demonstrate that each factor
relied upon is applied reasonably, and that the one or more factors
relied upon account for the entire differential. The bill would
prohibit an employer from discharging, or in any manner
discriminating or retaliating against, any employee by reason of any
action taken by the employee to invoke or assist in any manner the
enforcement of these provisions. The bill would authorize an employee
who has been discharged or discriminated or retaliated against, in
the terms and conditions of his or her employment because the
employee engaged in any conduct delineated in these provisions, to
recover in a civil action reinstatement and reimbursement for lost
wages and work benefits caused by the acts of the employer, including
interest thereon, as well as appropriate equitable relief. The bill
would prohibit an employer from prohibiting an employee from
disclosing the employee's own wages, discussing the wages of others,
inquiring about another employee's wages, or aiding or encouraging
any other employee to exercise his or her rights under these
provisions. The bill would also increase the duration of employer
recordkeeping requirements from 2 years to 3 years. By changing the
definition of a crime, this bill would impose a state-mandated local
program.
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  The Legislature finds and declares the following:
   (a) In 2014, the gender wage gap in California stood at 16 cents
on the dollar. A woman working full time year round earned an average
of 84 cents to every dollar a man earned. This wage gap extends
across almost all occupations reporting in California. This gap is
far worse for women of color; Latina women in California make only 44
cents for every dollar a white male makes, the biggest gap for
Latina women in the nation.
   (b) While the state's overall wage gap is slightly lower than the
national average of 78 cents to the dollar, the persistent disparity
in earnings still has a significant impact on the economic security
and welfare of millions of working women and their families.
Collectively, women working full time in California lose
approximately $33,650,294,544 each year due to the gender wage gap.
The wage gap contributes to the higher statewide poverty rate among
women, which stands at 18 percent, compared to approximately 15
percent for men, and the poverty rate is even higher for women of
color and single women living with children.
   (c) California has prohibited gender-based wage discrimination
since 1949. Section 1197.5 of the Labor Code was enacted to redress
the segregation of women into historically undervalued occupations,
but it has evolved over the last four decades so that it is now
virtually identical to the federal Equal Pay Act of 1963 (29 U.S.C.
Sec. 206(d)). However, the state provisions are rarely utilized
because the current statutory language makes it difficult to
establish a successful claim.
   (d) Pay secrecy also contributes to the gender wage gap, because
women cannot challenge wage discrimination that they do not know
exists. Although California law prohibits employers from banning wage
disclosures and retaliating against employees for engaging in this
activity, in practice many employees are unaware of these protections
and others are afraid to exercise these rights due to potential
retaliation.
   (e) To eliminate the gender wage gap in California, the state's
equal pay provisions and laws regarding wage disclosures must be
improved.
  SEC. 2.  Section 1197.5 of the Labor Code is amended to read:
   1197.5.  (a) An employer shall not pay any of its employees at
wage rates less than the rates paid to employees of the opposite sex
for substantially similar work, when viewed as a composite of skill,
effort, and responsibility, and performed under similar working
conditions, except where the employer demonstrates:
   (1) The wage differential is based upon one or more of the
following factors:
   (A) A seniority system.
   (B) A merit system.
   (C) A system that measures earnings by quantity or quality of
production.
   (D) A bona fide factor other than sex, such as education,
training, or experience. This factor shall apply only if the employer
demonstrates that the factor is not based on or derived from a
sex-based differential in compensation, is job related with respect
to the position in question, and is consistent with a business
necessity. For purposes of this subparagraph, "business necessity"
means an overriding legitimate business purpose such that the factor
relied upon effectively fulfills the business purpose it is supposed
to serve. This defense shall not apply if the employee demonstrates
that an alternative business practice exists that would serve the
same business purpose without producing the wage differential.
   (2) Each factor relied upon is applied reasonably.
   (3) The one or more factors relied upon account for the entire
wage differential.
   (b) Any employer who violates subdivision (a) is liable to the
employee affected in the amount of the wages, and interest thereon,
of which the employee is deprived by reason of the violation, and an
additional equal amount as liquidated damages.
   (c) The Division of Labor Standards Enforcement shall administer
and enforce this section. If the division finds that an employer has
violated this section, it may supervise the payment of wages and
interest found to be due and unpaid to employees under subdivision
(a). Acceptance of payment in full made by an employer and approved
by the division shall constitute a waiver on the part of the employee
of the employee's cause of action under subdivision (g).
   (d) Every employer shall maintain records of the wages and wage
rates, job classifications, and other terms and conditions of
employment of the persons employed by the employer. All of the
records shall be kept on file for a period of three years.
   (e) Any employee may file a complaint with the division that the
wages paid are less than the wages to which the employee is entitled
under subdivision (a) or that the employer is in violation of
subdivision (j). The complaint shall be investigated as provided in
subdivision (b) of Section 98.7. The division shall keep confidential
the name of any employee who submits to the division a complaint
regarding an alleged violation of subdivision (a) or (j) until the
division establishes the validity of the complaint, unless the
division must abridge confidentiality to investigate the complaint.
The name of the complaining employee shall remain confidential if the
complaint is withdrawn before the confidentiality is abridged by the
division. The division shall take all proceedings necessary to
enforce the payment of any sums found to be due and unpaid to these
employees.
   (f) The department or division may commence and prosecute, unless
otherwise requested by the employee or affected group of employees, a
civil action on behalf of the employee and on behalf of a similarly
affected group of employees to recover unpaid wages and liquidated
damages under subdivision (a), and in addition shall be entitled to
recover costs of suit. The consent of any employee to the bringing of
any action shall constitute a waiver on the part of the employee of
the employee's cause of action under subdivision (g) unless the
action is dismissed without prejudice by the department or the
division, except that the employee may intervene in the suit or may
initiate independent action if the suit has not been determined
within 180 days from the date of the filing of the complaint.
   (g) Any employee receiving less than the wage to which the
employee is entitled under this section may recover in a civil action
the balance of the wages, including interest thereon, and an equal
amount as liquidated damages, together with the costs of the suit and
reasonable attorney's fees, notwithstanding any agreement to work
for a lesser wage.
   (h) A civil action to recover wages under subdivision (a) may be
commenced no later than two years after the cause of action occurs,
except that a cause of action arising out of a willful violation may
be commenced no later than three years after the cause of action
occurs.
   (i) If an employee recovers amounts due the employee under
subdivision (b), and also files a complaint or brings an action under
subdivision (d) of Section 206 of Title 29 of the United States Code
which results in an additional recovery under federal law for the
same violation, the employee shall return to the employer the amounts
recovered under subdivision (b), or the amounts recovered under
federal law, whichever is less.
   (j) (1) An employer shall not discharge, or in any manner
discriminate or retaliate against, any employee by reason of any
action taken by the employee to invoke or assist in any manner the
enforcement of this section. An employer shall not prohibit an
employee from disclosing the employee's own wages, discussing the
wages of others, inquiring about another employee's wages, or aiding
or encouraging any other employee to exercise his or her rights under
this section. Nothing in this section creates an obligation to
disclose wages.
   (2) Any employee who has been discharged, discriminated or
retaliated against, in the terms and conditions of his or her
employment because the employee engaged in any conduct delineated in
this section may recover in a civil action reinstatement and
reimbursement for lost wages and work benefits caused by the acts of
the employer, including interest thereon, as well as appropriate
equitable relief.
   (3) A civil action brought under this subdivision may be commenced
no later than one year after the cause of action occurs.
  SEC. 3.  No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.