As indicated recently, California’s Pay Data Reporting Act requires all private-sector employers with 100 or more employees, with at least one employee in California, to report pay and hours worked by employees by race, ethnicity, and sex in ten different job categories to the Department of Fair Employment and Housing (“DFEH”) before the deadline: March 31, 2021.  In enacting this legislation, the Legislature noted that hidden bias exists and is encouraging self-assessment of pay disparities along gendered, racial, and ethnic lines to encourage voluntary compliance with equal pay and anti-discrimination laws.

California employers can start reporting their data today when the DFEH’s Pay Reporting Portal opens.  Employers should go to the California Pay Data Reporting page for a user guide, templates, FAQs, and access to the portal.

The DFEH compels employers to report gender information under California’s Gender Recognition Act, including three genders: male, female and non-binary based on employee self-identification.  Covered employers must report the pay and hours worked data by establishment (location), job category, pay band, sex, race, and ethnicity.  
The 100-employee “limit” is measured by either (i) “Snapshot Period”, a single pay period between October 1 and December 31 of the year prior or (ii) regular employment of 100 or more employees during the prior year.  It includes part-time workers, workers on paid or unpaid leave, furlough or other employer-approved leaves of absence.  Independent contractors should not be included.  However, if workers are misclassified as independent contractors, employers may not be properly counting their workforce.  

The reports to the DFEH will include:

1. For each establishment, during the Snapshot Period (The number of employees by race, ethnicity, and sex in each of ten job categories; The number of employees by race, ethnicity, and sex, whose annual earnings fall within each of the pay bands used by the United States Bureau of Labor Statistics in the Occupational Employment Statistics survey.)
2. For the entire Reporting Year, the total number of hours worked by each employee plus the hours the employee was on any form of paid time off for which the employee was paid by the employer (such as vacation time, sick time, or holiday time).
3. The employer’s name, address, headquarters’ address (if different), California and federal Employer Identification Number, North American Industry Classification System (NAICS) code, Duns and Bradstreet number, number of employees inside and outside of California, number of establishments inside and outside of California, and whether the employer is a California state contractor. If applicable, the name and address of the employer’s parent company or parent companies.
4. For a multiple-establishment employer, each establishment’s name, address, number of employees, and major activity.
5. A certification that the information contained in the pay data report is accurate and prepared in accordance with Government Code section 12999 and DFEH’s instructions, and the name, title, signature, and date of signature of the certifying official.
6. The name, title, address, phone number, and email address of someone who can be contacted about the report.

Compliance with Federal EEO-1 reporting will, likely, not satisfy the DFEH. 

The DFEH indicates that, due to the COVID-19 pandemic and the new requirements, it will consider requests for a very short deferral of compliance.  An employer seeking an Enforcement Deferral Period must complete the online request form before March 31, 2021, providing the reason for the request and other required information for a one-month deferral to April 30, 2021.

Employers who do not comply with California’s requirements can be liable for the costs associated with the DFEH’s attempts to order compliance. Therefore, now that the portal is open, all covered California employers should evaluate the DFEH’s templates and FAQs to properly report by the March 31, 2021 deadline.