SB 1063, as introduced, Hall. Conditions of employment: wage differential: race or ethnicity.
Existing law prohibits an employer from paying 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, unless the employer demonstrates that specific, reasonably applied factors account for the entire wage differential. Existing law authorizes an employee paid lesser wages in violation of this prohibition to file a complaint with the Division of Labor Standards Enforcement, and authorizes the employee, the division, or the Department of Industrial Relations to commence a civil action for the wages the employee was deprived of because of the violation, interest on those wages, and liquidated damages. Under existing law, an employer or other person who violates or causes a violation of that prohibition, or who reduces the wages of any employee in order to comply with that prohibition, is guilty of a misdemeanor.
This bill would expand that prohibition to also prohibit an employer from paying any of its employees at wage rates less than the rates paid to employees of another race or ethnicity for substantially similar work, as specified above. By expanding the scope 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.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
Section 1197.5 of the Labor Code is amended to
2read:
(a) An employer shall not pay any of its employees
4at wage rates less than the rates paid to employees of the opposite
5sex for substantially similar work, when viewed as a composite of
6skill, effort, and responsibility, and performed under similar
7working conditions, except where the employer demonstrates:
8(1) The wage differential is based upon one or more of the
9following factors:
10(A) A seniority system.
11(B) A merit system.
12(C) A system that measures earnings by quantity or quality of
13production.
14(D) A bona
fide factor other than sex, such as education,
15training, or experience. This factor shall apply only if the employer
16demonstrates that the factor is not based on or derived from a
17sex-based differential in compensation, is job related with respect
18to the position in question, and is consistent with a business
19necessity. For purposes of this subparagraph, “business necessity”
20means an overriding legitimate business purpose such that the
21factor relied upon effectively fulfills the business purpose it is
22supposed to serve. This defense shall not apply if the employee
23demonstrates that an alternative business practice exists that would
24serve the same business purpose without producing the wage
25differential.
26(2) Each factor relied upon is applied reasonably.
27(3) The one or more factors relied upon account for the entire
28wage differential.
29(b) An employer shall not pay any of its employees at wage rates
30less than the rates paid to employees of another race or ethnicity
P3 1for substantially similar work, when viewed as a composite of skill,
2effort, and responsibility, and performed under similar working
3conditions, except where the employer demonstrates:
4(1) The wage differential is based upon one or more of the
5following factors:
6(A) A seniority system.
end insertbegin insert7(B) A merit system.
end insertbegin insert
8(C) A system that measures earnings by quantity or quality of
9production.
10(D) A bona fide factor other than race or ethnicity, such as
11education, training, or experience. This factor shall apply
only if
12the employer demonstrates that the factor is not based on or
13derived from a race- or ethnicity-based differential in
14compensation, is job related with respect to the position in
15question, and is consistent with a business necessity. For purposes
16of this subparagraph, “business necessity” means an overriding
17legitimate business purpose such that the factor relied upon
18effectively fulfills the business purpose it is supposed to serve. This
19defense shall not apply if the employee demonstrates that an
20alternative business practice exists that would serve the same
21business purpose without producing the wage differential.
22(2) Each factor relied upon is applied reasonably.
end insertbegin insert
23(3) The one or more factors relied upon account for the entire
24wage differential.
25(b)
end delete
26begin insert(c)end insert Any employer who violates subdivision (a)begin insert or (b)end insert is liable
27to the employee affected in the amount of the wages, and interest
28thereon, of which the employee is deprived by reason of the
29violation, and an additional equal amount as liquidated damages.
30(c)
end delete
31begin insert(d)end insert The Division of Labor Standards Enforcement shall
32administer and enforce this section. If the division finds that an
33employer has violated this
section, it may supervise the payment
34of wages and interest found to be due and unpaid to employees
35under subdivisionbegin delete (a).end deletebegin insert (a) or (b).end insert Acceptance of payment in full
36made by an employer and approved by the division shall constitute
37a waiver on the part of the employee of the employee’s cause of
38action under subdivisionbegin delete (g).end deletebegin insert
(h).end insert
39(d)
end delete
P4 1begin insert(e)end insert Every employer shall maintain records of the wages and
2wage rates, job classifications, and other terms and conditions of
3employment of the persons employed by the employer. All of the
4records shall be kept on file for a period of three years.
5(e)
end delete
6begin insert(f)end insert Any employee may file a complaint with
the division that
7the wages paid are less than the wages to which the employee is
8entitled under subdivision (a)begin insert or (b)end insert or that the employer is in
9violation of subdivisionbegin delete (j).end deletebegin insert (k).end insert The complaint shall be investigated
10as provided in subdivision (b) of Section 98.7. The division shall
11keep confidential the name of any employee who submits to the
12division a complaint regarding an alleged violation of subdivision
13begin delete (a)end deletebegin insert (a), (b),end insert orbegin delete (j)end deletebegin insert
(k)end insert
until the division establishes the validity of
14the complaint, unless the division must abridge confidentiality to
15investigate the complaint. The name of the complaining employee
16shall remain confidential if the complaint is withdrawn before the
17confidentiality is abridged by the division. The division shall take
18all proceedings necessary to enforce the payment of any sums
19found to be due and unpaid to these employees.
20(f)
end delete
21begin insert(g)end insert The department or division may commence and prosecute,
22unless otherwise requested by the employee or affected group of
23employees, a civil action on behalf of the employee and on behalf
24of a similarly affected group of employees to recover
unpaid wages
25and liquidated damages under subdivisionbegin delete (a),end deletebegin insert (a) or (b),end insert and in
26addition shall be entitled to recover costs of suit. The consent of
27any employee to the bringing of any action shall constitute a waiver
28on the part of the employee of the employee’s cause of action
29under subdivisionbegin delete (g)end deletebegin insert (h)end insert unless the action is dismissed without
30prejudice by the department or the division, except that the
31employee may intervene in the suit or may initiate independent
32action if the suit has not been determined within 180 days from
33the date of the filing of the complaint.
34(g)
end delete
35begin insert(h)end insert Any employee receiving less than the wage to which the
36employee is entitled under this section may recover in a civil action
37the balance of the wages, including interest thereon, and an equal
38amount as liquidated damages, together with the costs of the suit
39and reasonable attorney’s fees, notwithstanding any agreement to
40work for a lesser wage.
P5 1(h)
end delete
2begin insert(i)end insert A civil action to recover wages under subdivision (a)begin insert or (b)end insert
3
may be commenced no later than two years after the cause of action
4occurs, except that a cause of action arising out of a willful
5violation may be commenced no later than three years after the
6cause of action occurs.
7(i)
end delete
8begin insert(j)end insert If an employee recovers amounts due the employee under
9subdivisionbegin delete (b),end deletebegin insert (c),end insert and also files a complaint or brings an action
10under subdivision (d) of Section 206 of Title 29 of the United
11States Code which results in an additional recovery under federal
12
law for the same violation, the employee shall return to the
13employer the amounts recovered under subdivisionbegin delete (b),end deletebegin insert (c),end insert or the
14amounts recovered under federal law, whichever is less.
15(j)
end delete
16begin insert(k)end insert (1) An employer shall not discharge, or in any manner
17discriminate or retaliate against, any employee by reason of any
18action taken by the employee to invoke or assist in any manner
19the enforcement of this section. An employer shall not prohibit an
20employee from disclosing the
employee’s own wages, discussing
21the wages of others, inquiring about another employee’s wages,
22or aiding or encouraging any other employee to exercise his or her
23rights under this section. Nothing in this section creates an
24obligation to disclose wages.
25(2) Any employee who has been discharged, discriminated or
26retaliated against, in the terms and conditions of his or her
27employment because the employee engaged in any conduct
28delineated in this section may recover in a civil action reinstatement
29and reimbursement for lost wages and work benefits caused by
30the acts of the employer, including interest thereon, as well as
31appropriate equitable relief.
32(3) A civil action brought under this subdivision may be
33commenced no later than one year after the cause of action occurs.
Section 1199.5 of the Labor Code is amended to read:
Every employer or other person acting either
36individually or as an officer, agent, or employee of another person
37is guilty of a misdemeanor and is punishable by a fine of not more
38than ten thousand dollars ($10,000), or by imprisonment for not
39more than six months, or by both, who willfully does any of the
40following:
P6 1(a) Pays or causes to be paid any employee a wage less than the
2rate paid to an employee ofbegin delete the opposite sexend deletebegin insert another sex, race, or
3ethnicity,end insert as required by Section 1197.5.
4(b) Reduces the wages of any employee in order to comply with
5Section 1197.5.
6No person shall be imprisoned
pursuant to this section except
7for an offense committed after the conviction of the person for a
8prior offense pursuant to this section.
No reimbursement is required by this act pursuant to
10Section 6 of Article XIII B of the California Constitution because
11the only costs that may be incurred by a local agency or school
12district will be incurred because this act creates a new crime or
13infraction, eliminates a crime or infraction, or changes the penalty
14for a crime or infraction, within the meaning of Section 17556 of
15the Government Code, or changes the definition of a crime within
16the meaning of Section 6 of Article XIII B of the California
17Constitution.
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