Pay Transparency 2026
California employers must now navigate comprehensive pay transparency requirements that took effect in 2023 and continue to evolve in 2026. SB 1162 fundamentally changed how employers communicate about compensation, requiring pay scale disclosure in job postings and imposing detailed pay data reporting obligations. Noncompliance carries significant penalties and litigation risk.
Under California Labor Code section 432.3, employers with 15 or more employees must include pay scales in all job postings—whether internal or external, published directly or through third parties. The pay scale must show the salary or hourly wage range the employer reasonably expects to pay for the position. Vague ranges that span $50,000 or more undermine the law’s purpose and may not satisfy the requirement. The Labor Commissioner has authority to investigate complaints and impose penalties up to $10,000 per violation.
⚠️ Many employers fail to recognize that pay scale disclosure applies to promotions and transfers. When an employer posts an internal opportunity or considers existing employees for advancement, the pay scale must be provided. This requirement extends beyond traditional job advertisements to internal mobility programs and succession planning processes.
Pay data reporting creates a separate compliance obligation. California employers with 100 or more employees must submit annual pay data reports to the Civil Rights Department (formerly DFEH) by the second Wednesday in May. These reports require detailed information on employee demographics, job categories, and pay bands. Employers with multiple establishments must file separate reports for each location. The data becomes the basis for pattern-and-practice discrimination investigations.
Remote work complicates compliance. If a California-based employer allows employees to work remotely from other states, does the pay scale requirement apply to positions filled by out-of-state workers? The safest approach treats all positions that could be performed by California employees as subject to disclosure requirements, regardless of where the selected candidate ultimately works. Employers who attempt narrow interpretations risk enforcement actions.
Additionally, employers must provide pay scale information to current employees upon request. This applies when an employee asks about the pay scale for their current position or for positions into which they might transfer or be promoted. Employers have a limited time to respond and cannot retaliate against employees who make these inquiries.
Are your job postings compliant with California’s pay transparency requirements? Have you reviewed your internal promotion processes to ensure pay scale disclosure? Employers who treat these obligations as ministerial tasks rather than strategic compliance issues face penalties and plaintiff-side wage and hour litigation.
If you need guidance on pay transparency compliance, pay data reporting, or responding to employee pay scale requests, consult with an employment attorney familiar with California requirements.
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Please note that this article is for informational purposes only and should not be considered and is not legal advice, and does not constitute an attorney-client relationship. It is recommended to consult with an attorney directly for specific guidance pertaining to your business or individual situation.
Please note that this article is for informational purposes only and should not be considered and is not legal advice, and does not constitute an attorney-client relationship. It is recommended to consult with an employment attorney directly for specific guidance pertaining to your business or individual situation.
This post shares general information based on common patterns I see in California workplaces. It is not legal advice, does not create an attorney-client relationship, and outcomes depend on specific facts — no lawyer can guarantee a result. Past results do not guarantee or predict future outcomes. AI may have been used to create this post. All content reviewed by a CA attorney before publication. This post may be attorney advertising.
Michael Trust Law, APC, 703 Pier Avenue, Ste. B367, Hermosa Beach, CA 90254: michaeltrustlaw.com