Equal pay for equal work is a principle that is easy to understand and apply. But California’s new Fair Pay Act requires equal pay for substantially similar work. How do you know what is “substantially similar”? You look at “a composite of skill, effort, and responsibility” and whether the work is “performed under similar working conditions.” That, dear reader, is a pretty vague standard. It’s impossible for an employer to know with certainty that the conclusion it reaches will be the same that a court will reach.

Copyright: joserpizarro / 123RF Stock Photo
Copyright: joserpizarro / 123RF Stock Photo

So will this new law open the proverbial floodgates of litigation? That threat gets made far more often than is warranted. It may be warranted here, however, for these reasons:

  1. Vague standards lead to more litigation. Quite simply, there’s more to argue about.
  2. Normally, an employee plaintiff bears the burden of proof. Yet the Fair Pay Act puts much of the burden of proof on employer defendants. The employer has to prove that a wage differential is based on one or more legitimate factors, that the factors relied on are applied reasonably, and that those factors account for the entire wage disparity. When employees don’t have the burden of proof, it’s much easier for them to get into court and stay there.
  3. The law provides for double damages (the wage disparity plus an equal amount for liquidated damages) plus attorneys’ fees.

What can employers do to prepare? I wrote a post on that topic and my colleagues Sahara Pynes and Nancy Yaffe wrote this Alert. While the new law takes effect January 1, 2016, the time to prepare is now, before the floodwaters get too high.