Women and people of color deserve equal pay for equal (or substantially similar) work. Unfortunately, the gender wage gap continues to persist today, and gets even worse as women move up in their companies. Wage disparities based on race are even more pervasive. Race and gender wage gaps lead to substantial losses over time—depriving women and people of color of an equal opportunity to earn a living and provide for their families.

In an effort to close the wage gap and strengthen equal pay protections, California passed the Fair Pay Act into law in 2015 and has continued to amend the law to add additional protections. Under the California Fair Pay Act, it is generally illegal for employers to pay women and people of color less than they pay other employees who perform “substantially similar” work. There are some exceptions to this rule, described below.

We are passionate in our pursuit of justice and equal pay for our clients. We have litigated and negotiated numerous high-profile equal pay cases, and have earned a strong reputation fighting for gender and racial equality in employer pay practices.

When is work “substantially similar” under the California Fair Pay Act?

The Fair Pay Act prohibits employers from paying employees at wage rates less than the rates paid to employees of a different sex, race or ethnicity for “substantially similar work.” “Substantially similar work” refers to work that is mostly similar in skill, effort, and responsibility, and performed under similar working conditions. “Skill” refers to the experience, ability, education and training required to perform the job. “Effort” refers to the amount of physical or mental exertion needed to perform the job. “Responsibility” refers to the degree to accountability or duties required in performing the job. “Working conditions” has been interpreted to mean the physical surroundings and hazards of the job.

There are certain exceptions to the rule that an employer must give equal pay to employees who perform substantially similar work. These include when the employer can prove that the difference in wages is based on a seniority sytem, a merit system, a system that measures earnings by quantity or quality of work production, or another “bona fide” reason other than sex, race or national origin. Any other “bona fide” reason must be a job-related concern that is aligned with business necessities. Any of these so-called “legitimate” factors for differences in pay must be applied reasonably and consistently, and account for the entire pay gap. This means that if any portion of the pay gap is due to gender, race, or ethnicity, the law has been violated.

What forms of “pay” must be equal?

The requirement of equal pay includes all forms of compensation made to an employee. In addition to wages/salary, this includes bonuses, stock options, deferred compensation, profit sharing, and benefits (such as medical insurance and retirement benefits).

Can my employer rely on my salary history when determining my pay?

Generally, no. The law prohibits employers from relying on a job applicant’s salary history as a factor in determining whether to offer employment at all or in determining what salary to offer. The law also bans employers from asking about information concerning an applicant’s salary history. However, an employer can ask an applicant for their salary expectations for the position.

How do I determine whether I am receiving equal pay?

California law protects your ability to discuss your wages with colleagues to determine if there is a wage gap. Your employer cannot prohibit you from disclosing your own wages, discussing the wages of others, inquiring about another employee’s wages, or aiding or encouraging any other employee to exercise their rights under the California Fair Pay Act. California law also prohibits employers from retaliating against employees that complain or ask for a raise based on their belief that a wage gap exists for their pay.

If you believe you are not receiving equal pay, we are here to listen to your experience and discuss a path forward. We are experienced in negotiating and litigating equal pay claims. For example, our firm currently represents a large group of current and former Oracle employees in a class action lawsuit alleging unequal pay for women.  

If you have questions or would like to discuss your potential equal pay claims, please contact one of our attorneys.