Fair Pay Act Compliance in California: An EPLI Liability?

Fair Pay Act Compliance in California An EPLI LiabilityThe new Fair Pay Act seeks to reduce the inequality in pay between men and women in California. As the disparity in pay has been in existence for more than seven decades, new laws seek to remedy the unfairness. During this time of transition, it is imperative that California employers equip themselves with a sound Employment Practices Liability Program.

William B. Gould IV, former chairman of the National Labor Relations Board at Stanford law school, states “It’s much more expansive than traditional employment discrimination law. This is the most ambitious law we’ve seen of its kind…It is more beneficial to female workers.”

This law is specifically targeting employees of both genders with “substantially similar” jobs, whose pay varies greatly. Attorney Anthony Oncidi says “This means that factors such as the amount of skill required, effort expended and the amount of responsibility given will be considered- not just job titles. An example would be a female housekeeper who claims that she is performing work that is ‘substantially similar’ to the work performed by a male janitor.”

While this law seeks to change an existing law, the Fair Pay Act obligates employers of all types to justify pay differentials, says Kristina Launey, attorney at Seyfarth Shaw. In addition, this amendment will also make it easier for plaintiffs to bring claims that don’t comply with the Labor Code section 1197.5. Inside Counsel states that it is predicted that because of this implementation, new lawsuits are expected to surge in the coming months for fair labor practices.

To prevent from falling victim to these types of claims, ensure your clients are reviewing their policies on wages and company practices. Even if they are not intended to be discriminatory, inside counsel should examine these operations closely. While this regulation is starting in California, other states are likely to follow suit and implement similar laws.

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