A new California law modifies employers' pay disclosure obligations, but its expansion of workers' ability to sue and recover damages for pay discrimination violations may ultimately be the statute's lasting legacy, attorneys say.
S.B. 642, known as the Pay Equity Enforcement Act, was signed into law on Oct. 8 by Gov. Gavin Newsom and will take effect on Jan. 1. It contains two sections that update separate parts of the California Labor Code: One amends Section 432.3, which houses the state's pay transparency requirements, by refining the definition of "pay scale" for job listing disclosures, and the second revises the state's Equal Pay Act codified in Section 1197.5.
"My big-picture takeaway is that I think right now is a really good time for employers to be looking at the compensation package[s] that they're offering to their employees in California," said Caitlin Sanders, an employer-side partner at Blank Rome LLP. They need to make sure "that people in each job category are being paid consistently across all different forms of compensation that [are] now included in the broad definition [of wages], and make adjustments as necessary on a proactive basis to avoid potential lawsuits."
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"New Calif. Law May Pave Way for More Pay Equity Suits," by Vin Gurrieri was published in Law360 Employment Authority on October 20, 2025.
