CA’s new pay transparency law aimed at closing wage gaps

Soon, when job seekers log online to search for open positions, they might see something new: a potential pay range for salaries associated with that job.

SB 1162 is California's new pay transparency law. It takes effect Jan. 1, 2023, and it's aimed at closing the wage gap for women and workers of color.

"Employers who have 15 or more employees must advertise the pay range or the pay scale with every advertisement for a new job, they also must provide that to every applicant for a job," said Karen Sloat, a Palm Desert-based labor and employment attorney.

"In California, women are still paid 88 cents for every dollar a man makes," she said. "Nationwide, women are paid 82 cents for every dollar that a man makes. And those differences are exacerbated when we talk about people of color or different ethnicities."

Sloat said the law will help people get the pay they deserve, but employers can still be discerning.

"The employer is still allowed to take into account performance skills, education and experience," she said.

Employers with more than 100 workers will be required under SB 1162 to report to the state their wages and those of any contractors they use. Sloat said that's a concern for local industries like agriculture.

"Employers in agriculture need to be very careful about the labor contractors they use, because they have to rely on them to get them all this data about ethnicity, race, gender, and the wages that the employer must report," she said.

Employers must also give current employees the salary ranges for their position. That allows workers to compare their rates.

"I think there are going to be a lot of claims by employees against employers saying they're not being paid fairly," Sloat said.

California's law defines the pay scale employers will have to post as the range they "reasonably expect" to offer. Experts say that can be vague, and leaves a lot open for interpretation by employers.