The California Civil Rights Department on Jan. 19 published an FAQ document on SB 1162, a law expanding pay reporting and disclosure requirements for most employers. Gov. Gavin Newsom signed the bill into law in September, and pay data reports covering the 2022 reporting year are due by May 10.
SB 1162 also updated California’s pay data reporting law to apply to employers using labor contractors such as staffing firms.
The most significant change made by SB 1162 is the requirement that employers with 100 or more employees hired through “labor contractors” must submit a separate pay data report covering such employees hired in the prior calendar year, law firm Fisher Phillips reported. Of course, this is in addition to the pay data report all private employers with 100 or more employees (with at least one employee based in California) must file.
“Although employers were mainly left in the dark about this new requirement, the updated FAQs provide some much-needed information on this new requirement,” the law firm states.
As an initial matter, the CRD now refers to the pay data reports that an employer will file on its own employees as “payroll employee reports.” The reports filed on employees from labor contractors are referred to as “labor contractor employee reports.” Employers reviewing the CRD FAQs and future additional guidance will need to understand the difference between these two terms, according to Fisher Phillips.
Companies and their staffing providers must report pay data only for a single snapshot pay period between Oct. 1 and Dec. 31 of each reporting year. According to the American Staffing Association, the CRD encourages staffing and their clients to collaborate on selecting a snapshot period for pay data reporting purposes. Thus, companies and their staffing providers should work together to select a snapshot period occurring between Oct. 1 and Dec. 31, 2022, for the 2023 filing deadline of May 10.
In addition, for reporting year 2022, companies and their staffing providers can report “unknown” with respect to temporary employees’ race, ethnicity and gender, where that information is indeed unknown and not reasonably obtainable before the filing deadline. However, the FAQs add that companies and their staffing providers should not expect this option in the future and that they should implement plans to obtain accurate information from employees for subsequent reporting years.
Additional information is available in the FAQs.