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  • Carole M. Bosch

California Broadens Fair Pay Act to Prohibit Discrimination on basis of Race and Ethnicity


Section 1197.5 of the California Labor Code, the Fair Pay Act, was recently expanded to preclude employers from paying employees of one race or ethnicity less than employees of different races or ethnicities who perform substantially similar work.

Effective January 1, 2017, all employees, regardless of gender, race, or ethnicity must be paid the same wages for substantially similar work, even if the employees work in different facilities in different states. Whether the work performed is “substantially similar” is based on skill, effort, responsibility, and working conditions. Pay differentials based on seniority, a merit system, piece rate pay, training, education, experience, or other bona fie factors are allowed if the employer can demonstrate that the factor is related to the job and not to race or ethnicity.

Aggrieved employees may file a case in court or file an administrative claim before the Labor Commissioner’s office. An employee does not have to file an administrative claim before filing an action in court.

A prevailing employee can recover the difference in wage, interest, and liquidated damages. An employee who files a case in court may also recover attorney’s fees and costs.


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