Understanding the California Equal Pay Act: Requirements & Liquidated Damages Explained

Introduction

Wage gaps based on sex, as well as race and ethnicity, mean disadvantaged workers must work longer for the same amount of pay as their more favored counterparts. The California Equal Pay Laws is one means of addressing these disparities.

The California Equal Pay Act (CEPA) is a broader law than the U.S. Equal Pay Act (EPA) in terms of coverage and requirements. First passed in 1949, California has amended the CEPA over the years to expand its coverage and impose stricter requirements.

Although both statutes address pay discrimination, the federal Equal Pay Act only prohibits pay disparities based on sex, while the CEPA prohibits pay disparities based on sex, race, and ethnicity.

Remedies under the CEPA are similar to the federal EPA and include recovery of the unpaid wage differential, an additional equal amount of “liquidated damages,” and attorney’s fees.

The Basics of the California Equal Pay Act

Under its current provisions, the CEPA prohibits an employer from paying any of its employees a wage rate for substantially similar work that is less than what it pays employees of (1) the opposite sex, (2) another race, or (3) another ethnicity.

Strict liability: An employer is liable under both the federal EPA and the CEPA regardless of whether the illegal pay disparity was intentional or negligent.

Defenses: Employers may have valid reasons for pay disparities. Accordingly, an employer can defend against a CEPA claim by demonstrating that the difference in wage rate is based on a (1) seniority system, (2) merit system, (3) system that measures quantity or quality of production, or (4) bona fide factor(s) other than sex, race, or ethnicity, such as education, training, or experience.

Other important provisions: The CEPA also includes the following important provisions:

• Jobs that are compared do NOT have to be located at the same establishment;
• An employer is prohibited from retaliating against employees who seek to enforce the law and against workers who assist employees with bringing claims under the statute; and
• An employer cannot prohibit workers from disclosing their wages, discussing the wages of others, or inquiring about others’ wages.

Recent amendments: California most recently amended the CEPA in 2018 when the state expanded the law’s coverage to include public employers. It also enacted Labor Code Section 432.3, which generally prohibits employers from seeking an applicant’s salary history information and requiring employers to supply pay scales upon the request of an applicant.

Liquidated Damages Under the California Equal Pay Act

Generally, “liquidated damages” means a precise amount of money or a specified formula to calculate the amount of money required to compensate a damaged party for its losses.

In the employment law context, liquidated damages constitute a fixed amount defined by the applicable statutes. As noted above, the CEPA provides for remedies that include recovery of the unpaid wage differential, an additional equal amount of “liquidated damages,” and attorney’s fees. The purpose of liquidated damages is to provide just compensation for the harm caused by the delay in receiving equal pay.

Note that employees who also file discrimination claims under California’s Fair Employment and Housing Act (FEHA) may receive additional remedies, such as compensatory damages, including damages for emotional distress. See here for more details.

Identifying and Addressing Pay Discrepancies

Employees can identify possible pay discrepancies by:

• speaking with coworkers who do similar work and/or with colleagues who do similar work for a different employer (particularly if they work in the same geographic area); and
• utilizing various available resources showing the pay range/rates for the specific job or substantially similar jobs.

If you suspect a pay disparity, bring it to the attention of management or human resources. It is always a good idea to express your concerns in writing so that you have documentation. Those in unionized workplaces may also want to bring their concerns to their union representative(s).

The California Commission on the Status of Women and Girls also offers explanatory materials and other resources here.

Legal Recourse for Violations of the Equal Pay Act

Should your employer refuse to correct the pay disparity, you can file a complaint with the California Labor Commissioner’s Office, specifically, its Department of Industrial Relations, Division of Labor Standards Enforcement (“DLSE”). Or you may file a court action. You do not have to file a claim with the Labor Commissioner’s Office before filing an action in court.

If you file a claim with the DLSE, it will investigate the claim and determine whether the employer violated the CEPA. In the event that the DLSE concludes the employer violated the law, it will make a demand for remedies. If the employer fails to comply with this demand for remedies, then the DLSE may file a civil action in court to try to recover any wages, interest, and liquidated damages owed to you.

Do not delay. There are important deadlines for filing claims. Under the CEPA, an employee must file a claim within two years from the date of the violation. In cases where the violation is willful (i.e., intentional), then an employee has three years to file. Each paycheck that reflects unequal pay constitutes a violation for purposes of calculating the filing deadline.

Consulting with an experienced attorney ASAP will help you navigate these deadlines and review our options. Moreover, a seasoned labor and employment law attorney will help you determine if you should also file a related claim under California’s FEHA.

Conclusion

You deserve to be paid fairly and equitably. Since 2001, the attorneys from Rothschild & Alwill, APC have dedicated themselves to workplace equality. To learn more about how to get the compensation you are entitled to for your work, contact the experienced employment attorneys at Rothschild & Alwill, APC. Email us or call or office in our Central Valley office in Bakersfield at (661-369-8510) or in Santa Barbara at (805-845-1190) to schedule an initial confidential consultation at no charge. Se habla Español.