BILL ANALYSIS
Senate Committee on Labor and Industrial Relations
Richard Alarcon, Chair
Date of Hearing: June 9, 2004 2003-2004 Regular
Session
Consultant: Frances Low Fiscal:Yes
Urgency:No
Bill No: AB 2317
Author: Oropeza
Version: As Introduced February 19, 2004
Subject: Employment: Gender Pay Equity
Purpose:
To increase the amount of liquidated damages paid for
violations of state law prohibiting gender-based pay
discrimination.
Analysis:
Existing state law , the California Equal Pay law (Labor
Code Section 1197.5), prohibits employers from paying an
employee a wage less than that paid to employees of the
opposite sex, in the same establishment, for equal work on
jobs requiring equal skill, effort and responsibility, and
performed under similar working conditions. Employers in
violation of the law are subject to civil action for the
recovery of the balance of the underpaid lost wages with
interest and an equal amount in liquidated damages that may
be paid to the aggrieved employee. The federal Equal Pay
Act is similar to the state law but also subjects repeat or
willful violators to a civil penalty not to exceed $1000
for each violation and allows for recovery of compensatory
damages. Recovery of compensatory damages is also allowed
for gender-based wage discrimination complaints filed with
the California Department of Fair Employment and Housing.
This Bill increases the amount of liquidated damages for
violations of state law prohibiting gender-based wage
discrimination to treble the balance of the underpaid lost
wages with interest and also subjects repeat or willful
violators to a civil penalty equal to five times the
balance of the underpaid lost wages with interest.
Comments:
1. Proponents :
Supporters of this bill argue that despite the
prohibition of gender-based payment discrimination in
California Law since 1949 and the federal Equal Pay Act
of 1963, wage inequities between men and women still
exist. For example, the U. S. General Accounting Office
recently found a gender-based wage gap of approximately
20 percent, even after taking into account work
experience, education, occupation, industry of current
employment and other demographic and job characteristics.
Yet, California ranks 39th among all states in progress
in closing the hourly wage gap. At the current rate of
change, California working women will not have equal pay
for another 40 years. Proponents believe the substantial
increase in liquidated damages for gender based wage
discrimination in this bill will help eliminate wage
inequality by penalizing employers engaged in these
practices and serve as an incentive for employees to
pursue legal remedies.
2. Opponents :
The California Employment Law Council (CLEC) and others
believe this bill is excessive. According to CLEC, the
change from "may" to "shall" eliminates discretion in
assessing damages and makes them automatic. The
California Chamber of Commerce and others are concerned
that this bill would put employers at a disadvantage
because the new mandatory damages would encourage
litigation against businesses.
3. Other Legislation :
AJR 66 (Lieber (Chapter 38, 2004)) of this session
proclaims April 20, 2004, as Equal Pay Day, and urges the
Hearing Date: June 9, 2004 AB
2317
Consultant: Frances T. Low
Page 2
Senate Committee on Labor and Industrial Relations
Congress of the United States to protect the fundamental
right of all American women to receive equal pay for
equal work and to continue to provide more effective
remedies to victims of discrimination in the payment of
wages on the basis of sex.
4. Legislative History:
This measure passed the Assembly by a 42 - 27 vote.If
passed out of this committee, this measure goes to the
Judiciary Committee.
Support:
American Civil Liberties Union
American Federation of State, County and Municipal
Employees
American Federation of Television and Radio Artists
Bill Lockyer, Attorney General, State of California
California Commission of the Status of Women
California Conference Board of the Amalgamated Transit
Union
California Conference of Machinists
California Independent Public Employees Legislative Council
California Labor Federation, AFL-CIO
California National Organization for Women
California State Employees Association
California School Employees Association
California Teamster Public Affairs Council
Engineers and Scientists of California, Local 20
Hotel Employees & Restaurant Employees International Union
Professional and Technical Engineers, Local 21
Region 8 States Council of the United Food & Commercial
Workers
Opposition:
Hearing Date: June 9, 2004 AB
2317
Consultant: Frances T. Low
Page 3
Senate Committee on Labor and Industrial Relations
California Chamber of Commerce
California Employment Law Council
California Manufacturers and Technology Association
Department of Finance, California State
National Federation of Independent Business
* * *
Hearing Date: June 9, 2004 AB
2317
Consultant: Frances T. Low
Page 4
Senate Committee on Labor and Industrial Relations