BILL NUMBER: SB 1063 AMENDED
BILL TEXT
AMENDED IN SENATE APRIL 20, 2016
INTRODUCED BY Senator Hall
( Coauthors: Senators
Glazer, Hueso, and Mitchell )
( Coauthors: Assembly Members
Brown, Campos, Gipson, Roger
Hernández, McCarty, and Ridley-Thomas
)
FEBRUARY 16, 2016
An act to amend Sections 1197.5 and 1199.5 of the Labor Code,
relating to employment.
LEGISLATIVE COUNSEL'S DIGEST
SB 1063, as amended, 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 1. 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) An employer shall not pay any of its employees at wage rates
less than the rates paid to employees of another race or ethnicity
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 race or ethnicity, 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 race- or ethnicity-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.
(c) Any employer who violates subdivision (a) or (b) 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.
(d) 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) or (b). 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 (h).
(e) 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.
(f) 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 (b) or that the employer is in violation of
subdivision (k). 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), (b), or (k) 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.
(g) 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) or (b), 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 (h)
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.
(h) Any An 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.
(i) A civil action to recover wages under subdivision (a) or (b)
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.
(j) If an employee recovers amounts due the employee under
subdivision (c), 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 (c), or the amounts recovered under
federal law, whichever is less.
(k) (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. 2. Section 1199.5 of the Labor Code is amended to read:
1199.5. Every employer or other person acting either individually
or as an officer, agent, or employee of another person is guilty of
a misdemeanor and is punishable by a fine of not more than ten
thousand dollars ($10,000), or by imprisonment for not more than six
months, or by both, who willfully does any of the following:
(a) Pays or causes to be paid any employee a wage less than the
rate paid to an employee of another sex, race, or ethnicity, as
required by Section 1197.5.
(b) Reduces the wages of any employee in order to comply with
Section 1197.5.
No person shall be imprisoned pursuant to this section except for
an offense committed after the conviction of the person for a prior
offense pursuant to this section.
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.
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