Sep 3 2022
Compensation in California Crosses a New Frontier: California’s Pay Transparency

California’s Pay Transparency Law- SB 1162

A Guide For California Businesses

Employer Implications

California’s Pay Transparency Law-SB 1162 is making headway. The state legislature approved the bill on Monday, September 13, 2022.  California’s Governor Gavin Newsom has until September 30, 2022, to enact the bill. 

This new law would require all employers in California with fifteen or more employees to include the hourly rate or salary range on their job postings. In addition, upon request, employers would be required to provide the pay scale to their staff, and employers would be required to submit data payroll data to the state annually broken down by the demographics of their organization.

Groundbreaking State

The state of California is home to many groundbreaking changes in employment law.  California’s Equal Pay Act requires employers in the state to disclose the pay range for positions they’re recruiting for to applicants upon request. In addition, employers within the state with at least one hundred employees are required to submit payroll data to the state annually.

California is now setting a groundbreaking precedent by adding an additional layer of transparency. California would be the first jurisdiction to require employers to distribute payroll data based on the demographics of the organization.

CA Average Earnings

What are the implications of Law-SB 1162?

This new law would require all employers in the state of California with fifteen or more employees to include the hourly rate or salary range within their job postings

Upon request, employers would be required to provide information on what they’re paying their staff members

Employers with one hundred or more staff members would be required to report to the state annually the median and mean hourly rate for each job category broken down by race, ethnicity, and sex

In addition, employers with one hundred or more workers through labor contracts would also be required to submit similar data annually

All employers would be required to record their individual employees’ job title and wage history during employment and for three years post termination

California Fair Pay Act-SB358

The California Fair Pay Act-SB358, originally enacted in 1949, was amended on October 6, 2015, to address pay disparity among men and women within the workplace.  The amendment requires employers only to rely on relevant factors to determine pay differences for their staff who perform substantially similar work. Such relevant factors include seniority, merit, quantity or quality of production, or a bona fide factor such as education or experience.

SB358 was also amended to protect employees who wish to discuss their pay with their coworkers openly, and it prohibits employers from retaliating against their staff for doing so.

Employer Liability

SB 1162-Failure to file the required reports or disclose the required information to the state of California would bring penalties to employers for non-compliance. In addition, employees would be eligible to file a complaint with the labor commission, which could lead to further fines and violations.

SB358-The division of labor standards enforcement enforces penalties for employers who violate SB358. Employers would be subject to back pay, interest, and liquidated damages.

To eliminate liability, employers are encouraged to document pay decisions within company policies and job descriptions based on relevant job factors, including job requirements, responsibilities, and working conditions.

Other Transparency Trends

Salary is an important factor for job seekers and, at times, can be a make-or-break decision whether to apply.  Organizations are starting to recognize this, and the number of job listings with salary information has been increasing. 

Some major companies like Microsoft plan to start disclosing pay on all their job listings more than mandated requirements to recruit qualified candidates. 

In addition, to meet job seekers’ needs, popular job listing websites like Indeed recognize this trend and have acted. Indeed encourages employees to post their salary, and if not provided, they utilize an algorithm to atomically pull salary information based upon the job description and the characteristics.

Tools and Resources

Blue Whale has assembled articles and white papers to help companies best manage and guide their compensation program. In addition, at no cost, Blue Whale offers reviews that can help your organization best manage the challenges the pay transparency brings to the employer community.

Let’s Start the Conversation

Blue Whale offers a full range of compensation services to help you achieve your business goals. Whether you’re looking to design a new compensation plan, analyze your current program, or stay up-to-date with the latest trends, we have the expertise and resources to meet your needs. Contact us to learn more about our compensation services and how we can help you take your program to the next level. Let’s start the conversation!

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Jun 30 2022
Quiet Quitting: A Trend or an Ignored Reality?

What is Quiet Quitting, and why are employees doing it

Quiet quitting occurs when an employee abandons the effort to go above and beyond work expectations and only performs the minimum essential requirements of their job.

Employees assert their control and choice and begin setting boundaries and refuse to do work outside work hours. They shift priority towards focusing on maintaining their health, well-being, relationships, and activities outside of work.

Social Media and Quiet Quitting

Most recently, quiet quitting has been given a label and has become more dominant. Quiet quitting has dominated social media, primarily on Tik Tok. Millennials and generation z have been actively posting videos on the topic, and several of them have become viral, which has triggered a lot of commotion.

Economic Impact

There is currently a tight labor market. Employees may feel like it’s easy to obtain alternative employment; therefore they have the power to renegotiate the terms of their employment contract.

Impact on Employers

Other states, including New York, Colorado, and Washington, have moved towards requiring employers to disclose the pay scale within their job listings. California is now setting a groundbreaking precedent by adding an additional layer of transparency. California is the first jurisdiction to require employers to distribute payroll data based on the demographics of the organization.  This new requirement intends to address pay equity and ensure no pay disparities.

Steps Employers Can Take to Combat Quiet Quitting

Employees are redefining work, and companies can begin to understand and reassess their current workplace practices or continue to see more turnover and decreased productivity. Quiet quitters have left employers no option but to take what employees say more seriously and assess why they are resigning or quietly quitting their jobs.

Address Employee Burnout

Employees who feel overworked or not valued can become burned out, leading them to quit or leave the workplace quietly. 

Creating a reasonable amount of work for them to complete is key to setting them up for success so that they are set up for success. Review their performance and productivity levels regularly, and if they start to slip, ask how you can help.

Offering paid time off and creating a culture to encourage employees to take it is another way to reduce burnout.  This will allow your employees time to recharge and come back more productive than ever.   

Bring Back Personnel Connections

Your employees naturally want to feel connected, and a lack of connection can affect your employee’s well-being, productivity, and retention.

Establish a pattern of touching base with employees at least regularly and ask how they are doing and how you can help.

Initiate Team Building Activities

Team building activities can be fun and encourage open communication, build stronger relationships, and build trust.

Don’t know where to start? Host a brainstorming session, encourage employees to participate in a fitness challenge, or host a virtual happy hour. 

Show appreciation

Every employee wants to feel appreciated for their hard work. In addition, appreciation can generate confidence and enthusiasm for the work they do.  Show appreciation for the great work that your employees have done.  It could be something as simple as verbally expressing gratitude or you can take a step further and delegate an award such as extra time off.

Increase Flexibility

Flexible is in high demand.  Providing flexible work could lead your staff to have higher job satisfaction and productivity which in turn could benefit your organization.

There are many forms of flexible work including telework, job sharing, condensed schedule, and part-time employment.

Several employers worry that their staff will underperform with a flexible schedule. To ensure that your staff is meeting expectations, set deadlines and regularly check in with them.

In conclusion, quiet quitting is a complex issue requiring individual and organizational attention. Organizations can foster a more engaged and productive workforce by understanding the reasons behind quiet quitting, recognizing its consequences, and implementing proactive strategies to prevent it. Through effective leadership and a commitment to creating a positive work environment, the prevalence of quiet quitting can be reduced, leading to increased job satisfaction and overall organizational success.

July, 2022

JPG_Admin 0 Comments
May 16 2022
Pay Transparency Trends (Legal and Social)

New Rules on How Employers Manage Their Compensation Program

As employees begin questioning their pay, while pay transparency continues to grow in popularity, employers are scrambling to defend their pay practices.

Salary information is becoming more available formally, through legislation, and informally, through social media posts. Employees now have the valuable information to leverage conversations with their managers and challenge current compensation. 

States are beginning to require the publication of salary ranges for all classifications. Some examples of the trends in the legislation include:

  • CA Equal Pay Act – Employers cannot ask about the previous salary and must disclose pay ranges if asked during an interview
  • CO Equal Pay for Equal Work – Employers must include salary ranges and benefits information in every job posting as well as disclose promotion opportunities and keep track of job descriptions
  • NY – Employers must post maximums and minimums on all job postings or promotions by November 2022 (extended from May 15th) 

More casually, there is a societal shift to make salary information less taboo. Coworkers are no longer ashamed of sharing how much they make in the company. A poll conducted in 2022 by YouGov Plc found that of their sample of 2,500 adults, 42% of Gen Z workers, ages 18-25, and 40% of millennial employees, ages 26-41, have shared their salary information with a coworker or other professional contact.

Many companies are not prepared to discuss the warrants for current salary ranges and are left with unhappy employees who still have pay concerns. Payscale has reported that employees are 50% more likely to leave if they think they are being paid below market, even if they aren’t. Some 57% of people paid at the standard market level believe they are underpaid, and 42% of those paid above the market think they are underpaid. This highlights the value of a compensation study where you can provide employees the ease of mind that they are being compensated based on their talent and skills in a competitive organization. 

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Apr 14 2022
Top Employer Concerns in 2022: Pay Transparency and Employee Benefits

2022 Top Compensation Trends

Pay Transparency Trends

As employees begin questioning their pay, while pay transparency continues to grow in popularity, employers are scrambling to defend their pay practices.

Salary information is becoming more available both formally, through legislation, and informally, through social media posts. Employees now have the valuable information they need to leverage conversations with their managers and challenge current compensation. 

States are beginning to require the publication of salary ranges for all classifications. Some examples of the trends in the legislation include:

  • CA Equal Pay Act – Employers cannot ask about the previous salary and must disclose pay ranges if asked during an interview
  • CO Equal Pay for Equal Work – Employers must include salary ranges and benefits information in every job posting as well as disclose promotion opportunities and keep track of job descriptions
  • NY – Employers must post maximums and minimums on all job postings or promotions by November 2022 (extended from May 15th) 

More casually, there is a societal shift to make salary information less taboo. Coworkers are no longer ashamed of sharing how much they make in the company. A poll conducted in 2022 by YouGov Plc found that of their sample of 2,500 adults, 42% of Gen Z workers, ages 18-25, and 40% of millennial employees, ages 26-41, have shared their salary information with a coworker or other professional contact.

Many companies are not prepared to discuss the warrants for current salary ranges and are left with unhappy employees who still have pay concerns. Payscale has reported that employees are 50% more likely to leave if they think they are being paid below market, even if they aren’t. Some 57% of people paid at the standard market level believe they are underpaid, and 42% of those paid above the market think they are underpaid. This highlights the value of a compensation study where you can provide employees the ease of mind that they are being compensated based on their talent and skills in a competitive organization. 

Benefits Trends

Total compensation is more than just cash; it’s the entire package that includes benefits available for employees based on budget. Companies are getting creative to make sure their employees perceive a good work/life balance. With changes in work models, like remote or hybrid arrangements, we are also seeing more companies jumping on the trend to offer unlimited time off.

The United States is the only developed country with no federal law requiring employers to offer paid holidays to employees. But companies are still trending to achieve work-life balance through this new perk: Unlimited Paid Time Off. While this is a debated topic, with people worried that this may be a trap to keep people constantly thinking about work, a recent study shows that 82% of employees that have unlimited PTO have the best rates of work-life balance. Competitive PTO (limited or unlimited) is more than just a mechanism to attract and retain top talent. These packages make business sense, especially for companies prioritizing innovation where we are looked at as a model to set expectations for productivity. To do good work, people must take care of themselves. Recovery is a lifestyle practice making its way into industries where creation and innovation are the organization’s backbones. 

If you’re looking to expand your benefits program, we welcome you to get inspiration from the list below for the most popular benefits and perks to include in your plan. We have compiled these options for you to consider as you continue to build your employee engagement.

Consider These Benefits Trends:

  • Flextime and Work-at-Home Options
  • Flexible holidays
  • Commuter Assistance
  • Performance Bonus
  • Vacation reimbursement: one-time bonus to use while taking time off
  • Healthy Cafeterias and Snack Machines
  • Home Office Stipend
  • In-office Career Development
  • Wellness Facilities and Support
  • Annual Learning Stipends for participating in industry certifications, seminars, or classes
  • Generous Parental and Caregiver Leave
  • Volunteer Time Exchange
  • Free Desktop Music
  • Personal Care Services – Bring in a stylist once a month for haircuts or try dry cleaning drop off
  • Discounted Access to Company Products/Services
  • Stock/Stock Options/Equity
  • Gym membership
  • Insurance coverage for you and your dependents

Affirmative Action Planning

With federal and state agencies prioritizing pay equity, you must identify, study, and address potential areas of vulnerability and help your pay system achieve your goals for equity, competitiveness, and compliance. This Risk Analysis is a report designed to provide clients a gateway to viewing potential pay equity liabilities across multiple tiers by leveraging comparisons by job title, job group, experience or seniority, and EEO category.

In our efforts to help organizations achieve pay equity and move closer to establishing equal pay for equal work, Blue Whale has launched Blue Whale AAP. Our Affirmative Action Planning supports government contractors and any business that wants them as a customer to stay in compliance with federal regulations easily.

This methodological process starts with data cleansing and your workforce activity data reconciliation. From this, we plan development, data system coding, reporting, and monitoring your hiring, promotion, and termination practices. Next, we develop an Adverse Impact Analysis to do potential bias testing in your HR practices to ensure we have the most accurate narrative.

Learn more

4/14/2022

JPG_Admin 0 Comments
Apr 11 2022
Latest News in Pay Transparency and Minimum Wage Increases
Home » 2022 » Page 2

Pay Transparency and Minimum Wage Increases: Are You Prepare to Meet the New Challenges?

If You Post A Job, You Must Post A Salary Scale

Starting in May and following a national trend in other major U.S. cities, New York City’s employers will be required to post salary ranges in their job postings. The law exempts temporary staffing firms as they provide this information to potential candidates. The legislation, meant to help correct pay inequities and discrimination, will make it unlawful not to include in job listings the minimum and maximum salary offered for any job in New York City. The range for the listed maximum and minimum salary would extend from the lowest to the highest salary that the employer, in good faith, believes it would pay for the advertised job, promotion, or transfer. Other municipalities are likely to follow as the law is a more significant trend toward pay transparency.

View a List of Cities Requiring Posting Salary Ranges

Pay Equity Efforts in the Public Sector Suffers a Setback

In a setback to proponents of workforce progressive policies, a law requiring board quotas from publicly traded companies with HQs in CA was declared unconstitutional. The law, Assembly Bill 979, signed in 2020 by Gov. Gavin Newson, set forth to increase boards’ composition by requiring publicly traded companies to have board members from underrepresented communities, including people of several races and ethnic groups and people who identify as gay, lesbian, bisexual or transgender. Proponents of the law argued that adding underrepresented groups to the board would aid racial and justice equality in the workplace. However, Judicial Watch, a D.C. nonprofit conservative advocacy group, filed a lawsuit in 2020, arguing the law’s racial, ethnic, sexual preference and gender-based quotas violated the state’s constitution’s equal protection clause. In response, Los Angeles County Superior Court Judge Terry Green ruled that the law violated the state constitution.

Learn More About our Pay Equity Services

Gender Pay Equity – Trending in the Wrong Direction

An initial analysis of proxy compensation disclosure by Equilar, a firm specializing in data-driven solutions for business development, board recruiting, and executive compensation, suggests that gender pay gaps increased in 2021, and in doing so, the gains recorded in 2019 and 2020 have essentially disappeared. According to an initial review of proxy statements relative to 2021, the median pay for women CEOs in the Equilar 500 was $11.8 million, or 18% lower than the median $14.5 million awarded to men. The initial figures seem to follow a two-year compensation difference between men and women. In reviewing past proxy information by gender, data suggests that the average pay for women went from $12.2 million in 2019 to $11.8. The average compensation for men has moved from $12.2 to $14.5 million for the exact period. Even though public and private companies work to adopt pay equity policies, the conversation around gender equity will likely grow louder. Also, this may activate boards and regulatory agencies for measures to minimize the gains achieved in the last few years.

Minimum Wage To Increase, Again, In Parts of Los Angles County

In time for most companies’ budgeting season, companies in the unincorporated part of Los Angeles County and the City of Los Angeles will need to manage another new round of increases to their minimum wage scale. The minimum wage in unincorporated LA County will be increasing from $15.00 to $15.96 per hour on July 1, 2022. The ordinance applies to employees who work at least two hours a week within unincorporated areas of Los Angeles County. The minimum wage in the City of Los Angeles will increase from $15 to $16.04. The wage scalation index, tied to consumer prices, and part of the City’s effort to curb poverty, has spiked considerably over the last few months, pushing the City to boost hourly rates above those in the County. This latest increase is a continuation of the annual increases that began in 2016 and now apply to all employers regardless of employee count. The minimum wage will continue to increase each year on July 1 based on the Consumer Price Index for Urban Wage Earners and Clerical Workers.

Learn more

March 14, 2022

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