This month, California’s SB 642 raises the stakes for pay transparency and equal pay compliance. The update has an impact on hiring, job postings, and compensation decisions.
What has changed?
Payscale is now defined as pay expected at hire
- Before: Employers could post broad salary ranges tied to the job level.
- Now: Pay ranges must reflect a good-faith estimate of what the employer actually intends to pay a new hire on day one – not a theoretical max.
“Wages” definition has change to include total compensation
- Before: Equal pay reviews focused mainly on base pay.
- Now: Bonuses, commissions, stock, equity, allowances, and benefits all count when comparing pay for substantially similar work.
Longer legal exposure
Employees have three years to file an equal pay claim and can recover up to six years of back pay, significantly increasing employer risk.
How should your staffing partner support this change?
- Align pay ranges before roles go live: Validate that posted ranges reflect real hiring intent, not legacy bands. Your agency should be pressure-testing ranges with hiring managers before a req is open.
- Calibrate offers across placements: Your agency should be helping you to avoid inconsistent starting pay across similar roles, especially when multiple managers are hiring.
- Shift the conversation to total compensation: An equity analysis needs to extend beyond salary. Dig into bonus structures, commission plans, and equity usage that could create hidden disparities.
- Understand the “why” behind the number: Your agency needs to support your documentation on how pay ranges are set and why specific offers land where they do.
- Help you standardize intake and hiring workflows: Support role scoping, leveling, and pay-setting practices instead of one-off negotiations that can undermine compliance.
To read further about California’s amended pay transparency and equity pay rules, check out California’s bill text for SB 642. Our team has decades of experience working in California and can guide your search process.
