Recent legislative changes under California’s SB 464 are set to expand pay data reporting obligations for private employers with 100 or more employees. The state’s Civil Rights Department (CRD) currently requires employers to submit annual reports detailing employee numbers by race, ethnicity, and sex across 10 job categories. These reports also require pay data segmented by federal pay bands and demographic characteristics, including the median and mean hourly rates and total hours worked for each group. 

SB 464 introduces several important updates: 

• Separate Demographic Data Storage: Employers must collect, and store demographic information used for pay data reporting separately from personnel records. 

• Expanded Job Categories: Starting January 1, 2027, the number of job categories for reporting will increase from 10 to 23, requiring more detailed workforce data. 

• Mandatory Penalties: Courts are now required to impose civil penalties on employers who fail to file the required report when requested by the CRD, making compliance even more critical. 

To remain compliant and prepare for expanded reporting requirements, employers should consider the following next steps:  

• Take immediate action to ensure that any demographic information gathered for reporting is stored separately from personnel files. 

• Begin assessing your workforce and data systems to accommodate the expanded job categories and make all necessary adjustments to existing reporting processes to avoid last minute adjustments that might make meeting the new January 1, 2027, deadline challenging.  

• Set up regular reminders and assign responsible personnel to ensure timely submission of pay data reports, thereby avoiding the new mandatory per employee civil penalties.