Workforce

California mandates more pay transparency from employers

Help Wanted ads will be required to carry a pay range, and potential hires can't be asked about their past pay levels.
Employers will need to put a pay range in their ads./Photo: Shutterstock

California restaurants that employ at least 15 people will be required starting next year to include a pay range in advertisements for open jobs and to provide new hires with a gauge upon request of what they can expect to earn, the result of a bill signed into law Tuesday by Gov. Gavin Newsom.

The measure also forbids employers in the state from asking job applicants about what they were paid in the past or hiring someone because of their pay history.

A third component of the law increases the employment data that employers of at least 100 people will be required to collect and submit to the state for analysis. The mandated information includes a breakdown of a company’s workforce by gender, ethnicity and race, as well as the median and average pay for each category by job.

For restaurant operations with multiple locations, the data will be required for each site.

The state says the information, an expansion of what was required under a 2020 law, will facilitate its effort to spot gaps in pay by gender, race or ethnicity.

It takes effect May 2023.

In signing the bill, SB 1162, Newsom hailed the measure as a step toward equalizing the pay of all individuals performing the same job, and to bring parity between men and women in particular.

California has the strongest equal pay laws in the nation, but we’re not letting up on our work to ensure all women in our state are paid their due and treated equally in all spheres of life,” Newsom said in a statement. “These measures bring new transparency to tackle pay gaps.”

The new law is the latest example of efforts by states to provide job candidates and new hires with a sharper sense of how their pay stacks up with the wages of individuals in a comparable position. At least a dozen states have taken steps to promote that transparency.

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.

Multimedia

Exclusive Content

Leadership

Restaurants bring the industry's concerns to Congress

Neary 600 operators made their case to lawmakers as part of the National Restaurant Association’s Public Affairs Conference.

Financing

Proposed TGI Fridays sale is no home run, but has promise for both sides

The $220 million all-stock deal would get Fridays’ owner TriArtisan out of its decade-long investment and give the struggling chain a like-minded partner in franchisee Hostmore, experts say.

Financing

Podcast transcript: Virtual Dining Brands co-founder Robbie Earl

A Deeper Dive: What is the future of digital-only concepts? Earl discusses their work to ensure quality and why focusing on restaurant delivery works.

Trending

More from our partners