Verifications Bulletin: California Assembly Bill No. 1676 – Wage Discrimination

Situation

In January 2016, the California Fair Pay Act became law, creating new gender pay equity protections under Labor Code section 1197.5. This Act was created to address the persistent gender wage gap and inequality in California and sets legislation in place to ensure that employers do not “pay any of its employees at wage rates less than the rates paid to employees of the opposite sex for substantially similar work.”

California Assembly Bill No. 1676 expands upon the Fair Pay Act to further specify that an individual’s “prior salary history shall not, by itself, justify any disparity in compensation.” Governor Brown of California vetoed a more restrictive version of this bill in 2015 (AB 1017), which even prohibited salary history discussions during the employment interview process.

Among other requirements under this amendment, employers must “maintain records of the wages and wage rates” for all employees for a period of three years. Employers using The Work Number centralized, automated income and employment verification service from Equifax may benefit through added compliance related to meeting employee wage retention requirements, as outlined in this bill. Employers are encouraged to consult their counsel to determine modifications that may be required to their pre-employment and hiring policies and procedures to ensure compliance with the latest amendment.

The amendment will take effect on January 1, 2017.

The Bottom Line

This announcement serves as a reminder to comply with all applicable local, state, and federal laws regarding the information that one requests during an income or employment verification.  Look for additional information on how this may affect your income verification procedures as the effective date approaches.

To learn more about how Equifax Workforce Solutions can help you manage your income and employment verifications, please contact Pete Krieshok at 314.214.7325 or pete.krieshok@equifax.com.

Click here to download a PDF version of this bulletin.