Employer pay data.

Senator Smallwood-Cuevas frames a package that would overhaul California’s private-employer pay data reporting by expanding the categories used to tally workforce demographics, preserving strict confidentiality for individuals while adding labor-contractor disclosures and new enforcement tools. The measure would apply to private employers with 100 or more employees and would require separate reporting for workers hired through labor contractors, with a defined sunset and a transition to a broader, re-enacted framework beginning in 2027.

Under the proposal, the pay data report would, initially, track counts by race, ethnicity, and sex across ten broad job categories and would later implement a expanded set of twenty-three categories. The reporting would also include the number of employees by race/ethnicity/sex whose earnings fall within federal pay bands, within-category median and mean hourly rates, and a “snapshot” count of workers in a chosen pay period. Employers would compute total W-2 earnings for the Reporting Year, tabulate how many employees fall into each pay band, and report total hours worked within each pay band, plus the NAICS code and establishment-level data for multi-location employers. A section for clarifying remarks would be optional, and all data would be formatted to be machine-readable for the department’s analysis.

Key mechanisms reinforce data governance and enforcement: demographic information collected for pay data would be stored separately from personnel records; labor contractors must disclose ownership names used to supply workers, with pay data to be provided by the contractors themselves where applicable; penalties for failure to file could be imposed on the employer on request, with per-employee amounts for initial and subsequent failures, and the department could recover its enforcement costs. If data is incomplete due to a contractor’s nonperformance, penalties may be apportioned to the labor contractor. Confidentiality protections shield individually identifiable information, with aggregate reporting allowed for public use, and records retained for at least ten years; data must be available in a format that supports search and sort, and employer reports covering each establishment are required when applicable.

Implementation unfolds through a two-stage approach: an amended provision places a sunset on January 1, 2027, after which a newly enacted provision becomes operative on that same date, re-enacting the pay data framework with the expanded twenty-three-category structure. The transition integrates continued cooperation with the Employment Development Department to identify large employers, maintains formal definitions for employees and labor contractors, and preserves enforcement and privacy provisions, including penalties directed to a dedicated civil rights fund and limitations on public disclosure prior to enforcement proceedings. The fiscal framework notes no explicit appropriation, but foregrounds potential administrative costs for employers and agencies alongside capitalized data-management obligations and the ongoing role of civil rights enforcement.