California has established some of the most comprehensive pay transparency requirements in the United States, designed to promote wage equity and eliminate discriminatory compensation practices. Through Senate Bill 1162 and related legislation, the state requires extensive salary disclosure, prohibits salary history inquiries, and mandates detailed pay data reporting to address wage gaps across protected classes.
Here’s what you need to know about California pay transparency law requirements for 2025.
Core Law & Compliance
What Is the California Pay Transparency Law? (2025 Update)
California’s pay transparency framework consists of multiple interconnected laws designed to create comprehensive compensation transparency and combat wage discrimination.
The primary component is Senate Bill 1162, signed into law in September 2022 and effective January 1, 2023, which requires employers with 15 or more employees to include wage ranges in job postings and provide pay scale information to current employees upon request. This law also expands pay data reporting requirements for large employers.
Assembly Bill 168, which took effect January 1, 2018, prohibits employers from seeking or relying on salary history information and requires disclosure of pay scales to applicants upon request. Together, these laws create a comprehensive transparency framework that addresses compensation at every stage of the employment relationship.
California Labor Code Section 2810.5 requires employers to provide detailed wage notices to new hires, including comprehensive information about pay rates, overtime, deductions, and working conditions. The state also mandates annual pay data reporting to the California Civil Rights Department for employers with 100 or more employees.
California Salary Posting Requirements for Employers
Under California law, employers with 15 or more employees must include the wage range they reasonably expect to pay for a position in all job postings, whether hosted directly by the employer or through third-party platforms.
The wage range disclosure must be included in the job posting itself and provided to third parties who assist with recruitment. This requirement applies to both external job postings and internal postings for promotions or transfers.
All employers, regardless of size, must provide wage ranges to California applicants upon request during the hiring process. Additionally, employers must disclose pay scales to current employees for their positions upon request, ensuring ongoing transparency throughout the employment relationship.
The law also prohibits employers from seeking salary history information from applicants and from using such information, if voluntarily disclosed, as the sole factor in determining compensation.
When Did/Does the California Pay Transparency Law Take Effect?
California’s pay transparency requirements have been implemented in phases over several years. Assembly Bill 168’s salary history ban took effect January 1, 2018, establishing the foundation for California’s transparency framework.
The comprehensive pay posting requirements under Senate Bill 1162 became effective January 1, 2023, requiring salary ranges in job postings and expanding pay data reporting obligations for covered employers.
The wage notice requirements under Labor Code Section 2810.5 have been in effect since 2012, with recent updates taking effect January 1, 2024, to include emergency declaration disclosures and enhanced paid sick leave information.
Employer Responsibilities
Which Employers Must Comply With the California Pay Transparency Law?
California’s pay transparency laws apply to employers with varying thresholds depending on the specific requirement. The salary posting requirements under SB 1162 apply to employers with 15 or more employees, provided at least one employee works in California.
All employers operating in California, regardless of size, must comply with the salary history ban and must provide wage ranges to applicants upon request. The wage notice requirements under Labor Code Section 2810.5 apply to all California employers for non-exempt employees.
Pay data reporting requirements apply to private employers with 100 or more employees who are required to file federal EEO-1 reports. This includes separate reporting obligations for employees hired through labor contractors.
California Pay Transparency Thresholds by Employer Size
California uses a tiered approach based on employer size and specific requirements. Employers with 15 or more employees must include wage ranges in all job postings and provide comprehensive salary disclosure throughout the hiring process.
Employers with 100 or more employees face additional pay data reporting requirements, including annual submissions to the California Civil Rights Department containing detailed compensation information categorized by gender, race, ethnicity, and job category.
All employers, regardless of size, must comply with salary history restrictions, wage notice requirements for new hires, and pay scale disclosure obligations upon employee or applicant request.
Penalties for Violating the California Pay Transparency Law
California enforces its pay transparency requirements through a robust penalty structure with significant financial consequences for violations. Employers who fail to include salary ranges in job postings may face civil penalties of $100 to $10,000 per violation, with escalating fines for subsequent violations.
Pay data reporting violations can result in penalties of $100 per employee for first-time violations and $200 per employee for subsequent failures to submit required reports. The maximum penalty can reach $10,000 per violation for serious or repeated non-compliance.
Employees and applicants can pursue civil action for violations of pay transparency requirements, potentially resulting in compensatory damages, attorney’s fees, and additional penalties. The law also prohibits retaliation against employees who exercise their rights under these provisions.
Employee Rights & Impact
What Employees Should Know About the California Pay Transparency Law
California employees have extensive rights under the state’s comprehensive pay transparency framework. All workers have the protected right to discuss their wages without fear of employer retaliation, and employers cannot prohibit wage-related discussions among employees.
Job applicants benefit from mandatory salary range disclosure in job postings for positions with covered employers, providing crucial information for informed decision-making during the application process. Applicants also have the right to request pay scale information from any California employer, regardless of size.
Current employees can request and receive pay scale information for their current positions, enabling them to understand their compensation relative to established ranges and advocate for appropriate adjustments when warranted.
California law also provides strong protection against salary history discrimination, ensuring that compensation decisions are based on job requirements and qualifications rather than previous wages.
Employee Rights Under California Salary Posting Law
California’s salary posting law grants employees several specific rights designed to promote transparency and prevent compensation discrimination. The fundamental right to wage information means employees can access detailed pay scale data for their positions and have this information provided promptly upon request.
Job seekers benefit from comprehensive upfront disclosure requirements, receiving salary range information directly in job postings rather than having to request it separately. This proactive approach ensures equal access to compensation information for all candidates.
Current employees have the right to understand how their compensation compares to established pay scales and can use this information to engage in informed discussions about career advancement and compensation adjustments.
The law also provides protection against retaliation for exercising transparency rights, ensuring employees can seek pay information and discuss wages without fear of adverse employment action.
How the California Pay Transparency Law Helps Reduce Wage Gaps
California’s comprehensive transparency approach directly addresses systemic factors that contribute to wage disparities. By requiring upfront salary disclosure in job postings, the law eliminates information asymmetries that have historically disadvantaged certain groups during negotiations.
The prohibition on salary history inquiries prevents the perpetuation of past discrimination through new employment relationships, ensuring that compensation decisions reflect current job requirements rather than historical inequities.
Mandatory pay data reporting provides state regulators with detailed information about compensation patterns across demographic groups, enabling identification of potential discrimination and enforcement of equal pay requirements.
The combination of individual rights and systemic oversight creates a powerful framework for identifying and addressing wage gaps while empowering workers with the information needed to advocate for fair compensation.
HR & Legal Best Practices
How HR Teams Can Comply With California Pay Transparency Law
HR teams should implement comprehensive compliance procedures covering all aspects of California’s multi-layered transparency requirements. This begins with conducting a thorough audit of current job posting practices to ensure all required wage range information is included and consistently applied across all platforms.
Establishing standardized procedures for handling pay scale requests from both employees and applicants helps ensure consistent compliance. HR teams should create clear timelines for responding to such requests and maintain documentation of all disclosures provided.
Training programs for hiring managers, recruiters, and other HR personnel should cover prohibited salary history inquiries, proper wage range disclosure, and employee rights under the transparency laws. Regular updates to these training programs help maintain compliance as requirements evolve.
Pay data reporting requires close coordination between HR and payroll departments to ensure accurate data collection and timely submission to the California Civil Rights Department by the annual deadline.
Updating Job Postings to Meet California Salary Transparency Rules
Job postings must be updated to include realistic wage ranges that reflect what the employer would actually pay for the position based on qualifications, experience, and other legitimate factors. The ranges should be specific enough to provide meaningful information to candidates while allowing flexibility for individual circumstances.
Wage range information must be included directly in the job posting text and cannot be provided through links, QR codes, or other indirect methods. The disclosure must be clear and prominently placed within the posting content.
For positions posted through third-party platforms, employers must ensure that the required wage range information is provided to the platform and included in the final posting. This responsibility cannot be delegated entirely to the third-party provider.
Regular review and updates of job posting templates help maintain compliance across all positions and departments while ensuring consistency in how wage ranges are presented to candidates.
Does the California Pay Transparency Law Apply to Remote or Hybrid Workers?
California’s pay transparency law applies based on the employer’s workforce composition and employee location, extending coverage to remote and hybrid positions under certain circumstances.
Employers with 15 or more employees, including at least one California-based worker, must comply with salary posting requirements for all positions, regardless of whether the work is performed remotely, in a hybrid arrangement, or entirely in-office.
This means that fully remote positions posted by covered California employers must include the required wage range information, even if the position could be filled by candidates from other states.
The law’s application to remote work reflects California’s commitment to ensuring that all workers have access to transparent compensation information, regardless of their work arrangements or physical location.
Comparison and Broader Context
How California Pay Transparency Rules Compare With Washington and New York
California’s approach to pay transparency is among the most comprehensive in the nation, featuring requirements that exceed those in many other states. Like Washington and New York, California requires proactive salary disclosure in job postings, but California’s 15-employee threshold makes the law applicable to more employers than some other states.
California’s pay data reporting requirements are particularly extensive, requiring detailed annual submissions categorized by multiple demographic factors and job categories. This level of reporting exceeds what most other states currently require, providing regulators with comprehensive data for enforcement purposes.
The combination of individual disclosure rights, mandatory posting requirements, and systematic reporting creates a more comprehensive framework than many other states have implemented, positioning California as a leader in the pay transparency movement.
Federal Pay Transparency Requirements vs. California Law
California’s requirements significantly exceed current federal pay transparency protections, providing workers with more comprehensive rights and employers with more detailed obligations than federal law mandates.
While federal law provides some wage discussion protections through the National Labor Relations Act and requires certain reporting from federal contractors, California’s state-level requirements create broader coverage and more detailed disclosure obligations for private sector employers.
California’s salary history ban and mandatory posting requirements fill important gaps in federal protection, demonstrating how state-level legislation can provide enhanced worker protections that exceed federal minimums.
Pay Transparency Laws by State: Where Does California Stand?
California stands as one of the most progressive states in pay transparency legislation, with comprehensive requirements that serve as a model for other jurisdictions. The state’s combination of salary posting mandates, reporting requirements, and individual rights creates one of the most thorough transparency frameworks in the United States.
The 15-employee threshold for posting requirements places California among the more inclusive states, extending transparency benefits to workers at smaller organizations than some other states require. This broader coverage demonstrates California’s commitment to comprehensive pay equity across different employer sizes.
California’s approach has influenced transparency legislation in other states, with its comprehensive disclosure requirements and strong enforcement mechanisms serving as a template for effective pay transparency implementation.
FAQs About the California Pay Transparency Law
Do small businesses need to comply with California pay transparency law?
Small businesses with fewer than 15 employees are exempt from the salary posting requirements but must still comply with other aspects of California’s transparency framework. All employers, regardless of size, must provide wage ranges to applicants upon request, comply with salary history restrictions, provide wage notices to new hires under Labor Code Section 2810.5, and allow employees to discuss wages without retaliation.
How should employers update existing job postings?
Employers should immediately update all active job postings to include specific wage ranges that accurately reflect what they would pay for each position. The wage range must be included directly in the posting text and provided to any third-party platforms hosting the listings. Employers should also update their standard job posting templates to ensure ongoing compliance with all new postings.
Are salary ranges required for internal postings as well as external ones?
Yes, California law requires wage ranges for both internal and external job postings. Internal postings for promotions or transfers must include the same comprehensive salary range information as external postings. This ensures that current employees have access to the same compensation transparency when considering internal opportunities.
What happens if employers fail to disclose salaries?
Employers who violate California’s pay transparency requirements face significant penalties, including civil fines ranging from $100 to $10,000 per violation for job posting failures and $100 to $200 per employee for pay data reporting violations. Employees and applicants can also pursue civil action for damages, and the law prohibits retaliation against individuals who assert their rights under these provisions. Non-compliance can also result in regulatory investigations and ongoing oversight by the California Civil Rights Department.
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