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Last year, California Governor Gavin Newsom signed into law Senate Bill 1162, which expands pay data reporting requirements for certain employers, among other things. Private employers with 100 or more employees (located anywhere as long as they have one employee based in California) must report 2022 pay and hours-worked data by May 10, 2023, to the California Civil Rights Department (CRD). In determining whether an employer has 100 or more employees, employers must include employees located inside and outside of California.  

New for 2023 is a requirement that employers submit a Payroll Employee Report with the median and mean hourly rate for 10 specific job categories for each combination of race, ethnicity, and sex. Employers may find that this new obligation will require additional time and resources to calculate and compile the data. 

Additionally, employers with 100 or more employees hired through labor contractors must also submit a separate Labor Contractor Employee Report. A labor contractor is an individual or entity that supplies a client employer with workers to perform within the client employer’s usual course of business. Like the Payroll Employee Report, the Labor Contractor Employee Report must include the median and mean hourly rate for the same 10 job categories for each combination of race, ethnicity, and sex. Employers are expected to submit a single Labor Contractor Employee Report, even if they have multiple labor contractors.  

The CRD may seek an order requiring an employer to comply with these requirements and shall be entitled to recover the costs associated with seeking the order for compliance. Moreover, the CRD may request that the court impose civil penalties of not more than $100 per employee for failure to file the required report, with penalties increasing to $200 per employee for subsequent failure to file the required report. These penalties also apply against a labor contractor who has failed to provide required pay data to a client employer.  

Employers must submit their reports using the CRD’s pay data portal. The reports must be in a format that allows the CRD to search and sort information using readily available software. To assist employers with this requirement, the CRD has updated versions of pay data reporting templates and resources on its website. Additionally, the CRD’s FAQs provide further guidance on the pay data reporting requirements. 

California employers will need to finalize their pay data report(s) soon to meet the May 10, 2023, deadline. The Employers Council California Legal Services team can assist with questions related to the reports. Contact us at CAinfo@employerscouncil.org.