California Issues More Guidance on Pay-Data Reporting Requirements

By Susan E. Groff, Christopher T. Patrick and Rassa L. Ahmadi © Jackson Lewis December 8, 2020

The deadline for employers to comply with California's pay-data reporting requirement (SB 973) and submit pay data to the Department of Fair Employment and Housing (DFEH) is March 31, 2021.

The DFEH has launched an information page that provides needed clarity on certain obligations and has issued additional guidance on the pay-data report's contents—largely confirming certain assumptions and clarifying other requirements.

Submission will resemble EEO-1 reports. Employers will report on their workforce by choosing a single pay period between Oct. 1 and Dec. 31 of each "reporting year," referred to as the "snapshot period."

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The submission will include the number of employees by race, ethnicity and sex in each of the 10 EEO-1 job categories (following the EEO-1 Instruction Booklet) and within each of the "pay bands" used by the U.S. Bureau of Labor Statistics Occupational Employment Statistics classifications (even though California has a higher minimum wage):

$19,239 and under
$19,240 – $24,439
$24,440 – $30,679
$30,680 – $38,999
$39,000 – $49,919
$49,920 – $62,919
$62,920 – $80,079
$80,080 – $101,919
$101,920 – $128,959
$128,960 – $163,799
$163,800 – $207,999
$208,000 and over

The submission also will include:

  • Total number of hours worked by each employee in each pay band.
  • "Reporting Year," "Snapshot Period," "Report Type (establishment or consolidated)" and total number of reports submitted by the employer.
  • Employer's name, address, headquarters' address (if different), Employer Identification Number, North American Industry Classification System (NAICS) Code, and Dun and Bradstreet Number.
  • Number of employees inside and outside of California.
  • Number of establishments inside and outside of California.
  • Whether the employer is a state contractor.
  • Name and address of the employer's parent company or companies, if applicable.
  • For a multiple-establishment employer's establishment reports, the establishment's name, address, number of employees and major activity.
  • For a multiple-establishment employer's consolidated report, the names and addresses of the establishments covered by the consolidated report.
  • Any clarifying remarks.
  • Certification that the information is accurate.
  • Information on a company contact for the submission.

Multi-establishment employers must file multiple reports. Multi-establishment employers must file multiple reports — a consolidated report and one for each establishment.

Employees outside California "count" toward 100-employee threshold. Both California and non-California employees count toward determining if an employer meets the 100-employee threshold. Temporary employees on payroll also count toward the 100-employee threshold. Moreover, an employer meets the 100-employee threshold by employing 100 or more employees during the snapshot period or by regularly employing 100 or more employees during the reporting year. Employers may not cherry-pick their snapshot period to avoid the reporting requirement.

Employers may exclude out-of-state employees from the submission. Not all employees must be included in the pay data reporting. Only "employees assigned to California establishments" must be included, but employers "may report to DFEH on its establishments and employees" outside of California. Employees teleworking from other states but "assigned to" a California establishment must be included in the report for their assigned establishment. Employees teleworking in California but assigned to establishments in other states must be reported in an establishment report covering only "those employees teleworking from California and who are assigned to a single establishment outside of California or all employees assigned to that establishment outside of California." The DFEH provides the following example:

If an employer has one establishment in California with 50 employees (with three workers telecommuting from Nevada during the Snapshot Period) and one establishment in Nevada with 50 employees (with three workers telecommuting from California during the snapshot period), the employer would submit (1) an establishment report for their California establishment that covers all 50 employees, including those teleworking from Nevada; (2) an establishment report for their Nevada establishment that covers either only the employees teleworking from California or all 50 employees assigned to the Nevada establishment; and (3) a consolidated report that includes either all 53 employees in/assigned to California or all 100 employees.

According to the guidance, this flexibility is intended to permit employers to comply in the manner that is least burdensome.

DFEH anticipates option to report non-binary employees. The DFEH also contemplates reporting in a manner that permits California employers to report females, males, and non-binary employees separately.

The DFEH is expected to release additional guidance before the March submission deadline.

Susan E. Groff is an attorney with Jackson Lewis in Los Angeles. Christopher T. Patrick is an attorney with Jackson Lewis in Denver. Rassa L. Ahmadi is an attorney with Jackson Lewis in Orange County, Calif. © 2020 Jackson Lewis. All rights reserved. Reposted with permission. 



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