New California Pay Day Reporting Requirement

On September 30, 2020, California Governor Gavin Newsom signed SB 973, also known as the California Gender, Race Pay-Gap Law. This law, going into effect January 1, 2021, creates new pay data reporting obligations, requiring employers to detail pay data for specified employee job categories, broken down by race, gender, and ethnicity.

Who is subject?

Private California employers with 100 or more employees that are required to file an annual, federal Employer Information Report (EEO-1) are subject to this new law. Employers with fewer than 100 employees and governmental employers are not subject to this law.

Deadline

Covered employers must submit pay data reporting to the California Department of Fair Employment and Housing (DFEH), by March 31, 2021. Thereafter, employers must submit pay data reporting annually to reflect pay data from the prior calendar year.

Broad Job Categories Included

The following job categories are included in the pay data reporting requirements:

• Executive or senior-level officials and managers
• First or mid-level officials and managers
• Professionals
• Technicians
• Sales workers
• Administrative support workers
• Craft workers
• Operatives
• Laborers and helpers
• Service workers
  
  

Reporting Requirements

The pay data report must include the following elements:

• Number of employees by race, ethnicity, and sex whose annual earnings fall within each of the pay bands that are used in the U.S. Bureau of Labor Statistics Occupational Employment Statistics survey
• Total number of hours worked by each employee counted in each pay band during the reporting year
• Employer's North American Industry Classification System (NAICS) code

Data must be provided in a format that allows the DFEH to search and sort the information using readily available software.

Employers with multiple establishments must submit a report for each establishment and a consolidated report that includes all employees.