CA Fair Pay Act still befuddles employers a year later
- A year has gone by since California passed its Fair Pay Act, yet businesses are still struggling to comply with it, reports SHRM. The law requires employers to explain pay disparities between men and woman doing the same work, but few employers feel confident they’re abiding by it. The act goes into effect Jan. 1, 2017.
- Employers aren’t sure how to weigh duties between various jobs against each other, nor have they figured out how to adjust wages, says SHRM. Employers also have the additional burden of explaining disparity in “substantially similar” work when acceptable criteria such as education, seniority and the production of goods based on quality and quantity are factored in.
- SHRM says the Fair Pay Act prompted businesses to call analysts and consultants for help. To help employers determine what “substantially similar” means, analysts have looked closely at how salaries are set, how pay categories are determined and how raises and bonuses are given out. SHRM noted that even analysts are confounded by the law.
Attorney Jennifer Shaw told SHRM that many companies based employees’ current salaries on what they earned in previous jobs. If new hires’ previous employers tolerated pay disparities, it’s possible that the current company is starting off new female hires with lower salaries than their male counterparts. California’s Fair Pay Act forbids employers to use workers’ previous pay levels to justify disparities.
To comply with the law, employers might begin by reviewing job descriptions to make sure the duties, skills and experience needed for a job are accurately described. In this case, employees’ job descriptions may include language that isn't necessarily gender-neutral, which may reinforce biases.