California’s new Fair Pay Act, which became law on Tuesday, October 6, is posed to be a litigation game-changer for companies that do business in California. Signed into law by Governor Jerry Brown, the Act is intended to “strengthen” the state’s existing equal-pay law by forbidding employers from paying employees less than their opposite-sex counterparts for “substantially similar work”. This subjective standard, which differs from the previous “equal work” standard, may leave room for ongoing debate between an employee and her employer. The Act also prohibits employers from retaliating against those who seek to raise their pay under the law.
Last year, the National Partnership for Women & Families announced that California women make 84 cents for every dollar earned by men. The law attempts to fix this by enabling female employees to sue if they are paid less than male counterparts who perform “substantially similar work,” instead of strictly equal work.Details