California won’t force companies to release pay data despite pay equity concerns

California companies will not be required to release payroll data after a bill was weakened Thursday by a key tax committee in the state legislature.

Legislation proposed by Sen. Monique Limón (D-Santa Barbara) would have required the state to post salary data online for private employers with more than 250 workers, with a focus on gender, race and origin ethnic.

But those requirements were stripped from the bill, without debate, in the fast-paced Assembly Appropriations Committee.

Limón called the last-minute amendments to the bill “disappointing to say the least” and “a setback for women and people of color,” but said she would continue to pursue pay equity measures in the future.

Equal pay has been an issue for decades in this country, and certainly in the state of California. So while women and people of color can’t see this information publicly because of what happened with the bill today, I’m in it for the long haul, Limón said when he was asked about the legislation at a reproductive rights event in San Francisco. led by Vice President Kamala Harris on Thursday.

Some elements of SB 1162 survived, however, and would address pay transparency if signed by Governor Gavin Newsom this month.

The bill would require employers to publish salary ranges, including during the hiring process, which supporters of the movement say would prevent those who are historically underpaid from accepting lower wages than their peers. .

The bill would also strengthen state enforcement of existing salary data requirements. In 2020, Newsom signed a bill that requires the state’s largest employers to collect wage data and report the information to the California Department of Fair Employment and Housing.

This information — which is aggregated statewide data and omits employer and employee identities — revealed that women, Latino and black workers are overrepresented in the lowest wage brackets of the state, according to the first report released by the state this year.

The policy aims to ensure that employers adhere to anti-discrimination laws. Nationally, women earned 83 cents for every dollar earned by men in 2020, according to US Census data.

The state has taken legal action against some companies, including JPMorgan Chase, after they failed to submit required data.

Limón’s bill would strengthen state enforcement by fining companies for noncompliance.

A number of business groups, including the California Chamber of Commerce, have opposed the bill, saying sharing salary data publicly would lead to heavy litigation and that these potential legal costs would then limit employers’ ability to raise wages.

“Releasing the data to target employers is a cynical and dishonest manipulation” of information, and is not a reliable measure of wage disparity, opponents said in a letter to lawmakers this month.

Denise Davis, spokeswoman for the chamber, said Thursday that SB 1162 would be removed from its list of “job killers” because of the new amendments but that the organization still opposes the bill.

Times editor Hannah Wiley contributed to this report.

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