"On October 8, 2025, Governor Newsom signed into law SB 642, which amends California's equal pay requirements, including revising the "pay scale" definition, extending the statute of limitations for equal pay claims to three years and permitting recovery for a period up to six years, and defining key terms such as "wages." These amendments go into effect January 1, 2026."
"SB 642 requires the pay scale on the posting to be the salary or hourly wage range the employer in good faith reasonably expects to pay "upon hire." This definition may narrow the posted pay scale because the range should be the range the employer expects to pay to the candidate upon hire, instead of a broader range that some employers might have previously provided to cover the full range for the position."
"Modified Definitions for Job Posting Pay Scales and Wages Subject to Equal Pay Act Requirements SB 642 brings several changes to California equal pay requirements under Labor Code Sections 432.3 and 1197.5 that will require careful review by employers and potential modification to current practices. While California's Equal Pay Act has been one of the broader equal pay laws in the United States, the amendments to the Act are significant and heighten the risk of potential liability for employers."
SB 642, effective January 1, 2026, revises California equal pay requirements under Labor Code Sections 432.3 and 1197.5. The pay scale posting requirement now mandates listing the salary or hourly wage range the employer in good faith reasonably expects to pay upon hire, narrowing previously broader posted ranges. The statute of limitations for equal pay claims is extended to three years with a recovery period of up to six years. The law aligns the definition of "wages" with federal Equal Pay Act standards, encompassing all forms of compensation including benefits, stock options, and bonuses. Employers should review and modify pay-posting and compensation practices to reduce heightened liability risk.
Read at California Peculiarities Employment Law Blog
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