Governor Vetoes Job Killer

Governor Edmund G. Brown Jr. has vetoed a job killer bill that would have imposed a new data collection mandate on California employers and exposed them to public criticism and costly litigation.

The California Chamber of Commerce identified AB 1209 (Gonzalez Fletcher; D-San Diego) as a job killer because it would have: created a false impression of wage discrimination or unequal pay where none exists, therefore subjecting employers to unfair public criticism; exposed employers to significant litigation costs to defend against meritless claims; and imposed costs on the Secretary of State to collect and post the data.

AB 1209 required employers with 500 or more employees in California to collect data on the difference in mean and median salaries paid to men and women in the same job title or classification and submit the information to the Secretary of State. The state would have then posted the company’s salary information — with the company name attached — on a publicly accessible website.

The Governor stated in his veto message he is worried that the ambiguity in AB 1209 “could be exploited to encourage more litigation than pay equity.”

CalChamber’s analysis of the bill had found that the bill not only would have increased costs on the state for developing and maintaining a new program; it also would have been costly to employers required to take time away from business operations to collect and submit the information to ensure they were complying with yet another state regulation.

CalChamber also argued that the bill ignored the numerous, lawful, bona fide factors on why a particular wage disparity might exist. AB 1209 also would have compromised the privacy of employees who may not want their salary information disclosed. Additionally, the bill would have provided a website that a plaintiff’s attorney could use to file new lawsuits against California employers, exposing them to costly and meritless litigation.

Today is the final day for the Governor to dispense with legislation on his desk. CalChamber will issue a final status report of the top priority bills for California’s business community on October 20.

In addition, CalChamber will provide information to members about how to ensure compliance with new employment laws and develop appropriate policies for their businesses. Stay tuned for more information.