Capitol Report: CalChamber-Supported Gender Equity Pay Bill on Assembly Floor​​

A California Chamber of Commerce-supported bill that seeks to eliminate pay disparity based on gender will be considered by the full Assembly this week.

SB 358 is the subject of the latest CalChamber Capitol Report video. The bill is authored by Senator Hannah-Beth Jackson (D-Santa Barbara), who is chair of the California Legislative Women’s Caucus. The bill ensures that women are paid equally for work that is substantially similar to the work of their male colleagues, and are not retaliated against if they discuss or ask how much their male colleagues are paid.

“Our members understand the importance of ensuring that employees should be paid equally for equal work and we believe that SB 358 emphasizes that point and clarifies it,” said CalChamber Policy Advocate Jennifer Barrera during a news conference yesterday with the bill’s author. “We also believe that SB 358 provides a great balance between making sure there is no gender inequity in pay, but also leaving flexibility for an employer to reward employees for education, skill, training experience with regard to compensation as well.”

Senator Jackson took time to thank CalChamber for working so diligently to help craft this legislation.

“Jennifer Barrera and the Chamber have been my partners in this. We don’t agree on a whole lot of things, so I am particularly excited that this was an area where she not only understood this, but has worked diligently with us to bring the business community on board to craft this measure in a way that will benefit everyone.”

According to a CalChamber analysis, SB 358 seeks to strengthen California Labor Code Section 1197.5, which precludes an employer from discriminating against an employee in pay on the basis of gender.

Currently, Section 1197.5 mandates that an employer shall provide equal pay for equal work, unless a bona fide factor other than gender justifies the differential. In an effort to eliminate the risk of a stringent interpretation of this standard, SB 358 proposes to amend this section to specify that an employee shall not be paid less than another employee who is performing “substantially similar” job duties, unless a bona fide factor exists.

CalChamber believes this will achieve the intent of the law and eliminate any employer from seeking to justify a wage differential through meaningless differences in job duties under the guise that such positions are not “equal.”

More Clarity

SB 358 also seeks to provide further clarity to the term “bona fide factor” under which an employer may provide differential pay for a legitimate business purpose, such as to compensate an employee who has more extensive training, education or experience. The CalChamber believes this clarification will help employers navigate their pay structure and avoid unnecessary litigation regarding what business purposes qualify as a bona fide factor.

The CalChamber believes that employees who are similarly situated and who generally perform the same duties or the same position should be compensated in the same manner, regardless of any protected classification, including gender.

“We are hopeful that SB 358 will limit litigation as it provides an objective criteria for employers at the outset to determine the pay base for employees and make sure those are not determined based on gender,” said Barrera.

Next Step

The Assembly is expected to consider SB 358 for a vote during the next floor session on Thursday. Following the bill’s passage, it will head to the Senate for a concurrence vote and then on to the desk of Governor Edmund G. Brown Jr.

Staff Contact: Jennifer Barrera