On September 30th, California Governor Gavin Newsom signed Senate Bill 973 which requires private employers to submit an annual Pay Data Report to the Department of Fair Employment and Housing (DFEH). California has not published the final guidelines for reporting as of October 2020. The report must include specific pay data that is to be categorized by gender, race, and ethnicity. This bill is in response to the now rescinded, EEO-1 component 2 report.
Since 1966, the Equal Opportunity Commission (EEOC) has required that an Equal Employment Opportunity Report (EEO-1) be filed annually on a federal level.
The following companies must provide employment data categorized by race/ethnicity, gender, and job category:
All EEO-1 reports are filed annually, no later than March 31st.
During the Obama administration, a new addition to the EEO reports, component 2 was introduced.
Companies that were required to report component 2 data in addition to the original EOO-1 data, included:
This EEO-2 report included the compensation and hours worked for full and part-time employees on the employer’s payroll during those time frames mentioned above.
However, in February of 2020, a federal court ordered that the collection of component 2 data will no longer be required. When only 89 percent of eligible filers had submitted the data for component 2 by the proposed deadline, the EEOC asked the court to deem collection complete and no longer accepted those filings. On a federal level, EEO-1 data is still required to be annually reported. That is where Senate Bill 973 comes in. This bill is designed to act as a replacement for the component 2 data on a state level.
This state-mandated equal pay report must be filed annually before March 31st (the same deadline as the federal EEO-1 report) by companies with 100 or more employees to the DFEH.
The report must include:
In addition, employers can add clarifying remarks if necessary.
It also needs to be submitted in a sortable and searchable format and the data must be for the end of any pay period between October 1st and December 31st of the previous year (If reporting by March of 2021, the pay period will be from October 2020 through the end of December 2020).
The data on W-2 income should be reported by tallying the number of employees in each of the job categories (reported in the federal EEO-1) and detailing wages for each.
The bill authorizes the DFEH to seek an order requiring non-reporting employers to comply. However, it does not clarify if the minimum employee count includes employees that live out of state.
Is there anything Payroll Systems can help you with as you accommodate rapid legislation changes? Reach out and talk to us about easy-to-scale solutions you need for your business.
When the lockdowns and shelter-in-place orders began to emerge across the country earlier in the year, many hoped that this would all be over by summer at the latest Unfortunately, this has been far...
Company culture is the environment in which your company operates and what your employees experience on a regular basis while working at your company This includes your core values, mission, goals,...
A company’s hiring process is a crucial part of the employee lifecycle that requires thoughtful consideration and effort to land on the right candidate We recently discussed some general steps...
Understanding the difference between exempt and nonexempt employees can be confusing For employers, clearly classifying an employee as either/or is important to do as early as possible in the hiring...
2020 is coming to an end and 2021 is just around the corner With the new year on its way, we put together a handy calendar with both federal holidays and important dates to...
The IRS has issued some clarification on the reporting that needs to accompany the deferral of Social Security tax On August 8, 2020, President Trump signed an executive order that allowed for the...
This article provides general information and shouldn’t be construed as legal or HR advice. Since employment laws may change over time and can vary by location and industry, please consult a lawyer or HR expert for advice specific to your business. You can also contact Payroll Systems to inquire about our HR support services.