November 3, 2017

Dan Handman Speaks to LA Biz about new state law protecting women and children


Dan Handman wrote an article entitled “Two laws offer new protections to California women and families” for LA Biz.

A link to the article can be found here, and text is below.

Powerful and prominent business leaders have brought sex discrimination back into the forefront of the American political discussion.

The alleged sexual assaults and rampant harassment by Harvey Weinstein, Bill O’Reilly, Roger Ailes and Bill Cosby have elevated sexual harassment and assault to a level unseen since Clarence Thomas’s confirmation hearing in the early 1990s. But those four cases are unusual, because if there is truth to the allegations against those men, then they are classic sociopaths who have no understanding of nor care for the effect of their actions on other, innocent people.

Most sex discrimination is far more subtle. That understated nature of sex discrimination has been recognized in statehouses and city councils across the country and especially here in California.

In 2015, Governor Jerry Brown signed into law California’s Fair Pay Act (SB 358) which strengthened protections for female employees who are paid comparatively less than their male counterparts by requiring employers, not employees, to justify those disparities in court. Supporters of the law believed that by alleviating those burdens they would enable females to correct the effects of past pay discrimination.

Two new laws signed by Governor Brown on October 12 aim to meet the same objectives by strengthening protections for female employees and for parents seeking leave for baby bonding.

Salary information

The first, Assembly Bill 168 (AB 168), prohibits California employers from asking about or relying on the salary history information of an applicant in making decisions about offers of employment or compensation. It also requires employers to provide the “pay scale” for any position sought, if one exists, to an employee upon request. Although the law is not clear on precisely what a pay scale includes, presumably it can be premised on historical pay levels for the position sought.

The second theory is that the burden of such pay disparities follow females from job to job, so that when they are asked on an application how much they are currently earning, a new employer can offer more money but at a discount to males who have historically been paid more. The bill’s sponsor, Assembly Member Susan Eggman, cited that rationale, stating that “perpetuating wage inequality that has spanned generations of women in the workforce” was the principal reason for the law.

Employers fought the bill, claiming that salary history is a useful tool to manage costs and that it is difficult to determine an appropriate salary without that information. They were unsuccessful, however, because the current political climate afforded them very little leeway with female voters. Moreover, the law does not prohibit applicants from volunteering salary history or prohibit an employer from relying on that information.

Baby bonding leave

California allows employees, female or male, to take so-called “baby-bonding” leave for the birth or adoption of a child so long as the employer has at least 50 employees. Senate Bill 63 (SB 63) expands that right to anyone employed by a company with at least 20 employees — a change which some have estimated to affect 2.7 million California workers.

Employer groups like the California Chamber of Commerce opposed the law claiming that it would impose significant burdens on small employers who could not afford to lose critical employees for extended periods of time. In fact, Governor Brown vetoed a nearly identical bill in the last legislative session for precisely that reason, though he signed it this time, offering no reason for his change of heart other than to say that the laws are “paving the way toward a better California, and today’s actions will make a positive difference for women, children and families across the state.”

What these laws mean for California employers

These laws, which go into effect on Jan. 1, 2018, have several practical and immediate effects on California employers. First, employers who have between 20 and 49 employees will need to adopt policies on baby bonding leave. Such changes are relatively easy to do, but employers should be wary that their baby bonding policies are neither under-inclusive nor over-inclusive.

In practical terms, mid-sized employers should have policies that correctly identify the types of leave available, the conditions under which such leave can be taken and the amount of leave allowed.

Second, employers of all sizes will need to revise applications and train managers on interview techniques. In particular, applications should no longer contain a request for salary history and managers should understand that they cannot directly ask an applicant, male or female what they have earned in the past or at present.

At the same time, they need to know what they can ask, namely what applicants are looking to earn and why they think their requested compensation is appropriate. They should also know that while they cannot suggest, hint or otherwise encourage an applicant to provide a salary history, if an employee does provide it or if the manager knows from some other source, he is not required to un-learn what he already knows.

Ultimately, these laws were motivated by the political pressure on legislators and the Governor to protect an important constituency, female voters. Their benefit and their burden remain to be seen.