California pay data collection and reporting requirements: With deadline on the horizon, the DFEH issues a template and FAQs

To encourage California employers to self-assess and correct pay disparities along racial and gender lines, the California legislature enacted Senate Bill 973 (SB 973) on September 30, 2020. SB 973 mandates that private employers of 100 or more employees, at least one of whom being in California, must report pay and hours-worked data by establishment, job category, sex, race and ethnicity to the Department of Fair Employment and Housing (DFEH) by March 31, 2021, and annually thereafter. In addition to providing for new pay data reporting, SB 973 authorized the DFEH to enforce the Equal Pay Act (Labor Code section 1197.5), which prohibits unjustified pay disparities.

This past month, the DFEH issued answers to FAQs and a template form for employers to submit their reports. The guidance clarified that an employee who regularly teleworks from a residence in California but who is assigned to an establishment outside of California must be included in the pay data report. More guidance from the DFEH is expected before the March 31 reporting deadline.