California pay data reports for reporting year 2025 are due on 13 May. If you have one hundred or more payroll employees, or one hundred or more labor contractor employees, with at least one of them in California, you are filing. The portal has been open since 2 February.
Most writing about this deadline focuses on how to file. That is the easy part, and the Civil Rights Department’s own handbook explains it better than any commentary will. The harder question is what the exercise reveals, and what you have already published that will be read against it.
What changed for this cycle
Three things, and only one of them is clerical.
Three new required fields. Both the payroll employee report and the labor contractor employee report now carry exemption status, employment type, and weeks worked in the reporting year. Weeks worked includes paid time off. Some commentary has described these fields as optional for this cycle. The Department’s own guidance does not, and where the Department and a commentator disagree about the Department’s form, the Department wins.
Penalties are now mandatory. SB 464 took effect on 1 January. Where the previous statute said a court may impose a civil penalty on the Department’s request, it now says a court shall. One hundred dollars per employee for an initial failure, two hundred for a subsequent one. On a workforce of four hundred, a second failure is eighty thousand dollars, arrived at without anyone having to be persuaded of anything.
Demographic data must be stored separately from personnel records. Also from 1 January. This is the one worth pausing on, because it is not really a reporting rule. It is a data governance rule wearing a reporting rule’s clothes, and complying with it properly means changing where the information lives rather than changing what you submit.
One further change is queued but not yet live. From 1 January 2027, the report moves from ten job categories to twenty-three, first affecting the reporting year 2026 filing due in May 2027. That is next year’s problem in one sense and this year’s in another, because the titles you are assigning now are the titles you will have to map then.
The report is a diagnostic that you file with the state
Here is the part employers tend not to say out loud. Assembling this report means computing, for every combination of job category, race, ethnicity, and sex, the number of employees in each pay band. That is not a compliance artifact. That is a pay equity analysis, performed by you, on your own data, and then handed to a civil rights enforcement agency.
Employers who treat the filing as a clerical task run the numbers, submit them, and never look at them. Employers who treat it as a diagnostic run the numbers in March, look hard at any band where the distribution is uncomfortable, and find out whether there is an explanation before somebody else asks for one.
A pay gap in a band is not by itself a violation. Seniority, a bona fide merit system, a system measuring earnings by quantity or quality of production, and other bona fide factors such as education, training, or experience can all account for a difference. But the defense has to be a system that existed before the question was asked. A rationale constructed afterward reads exactly like what it is.
The real exposure is in your job postings
California has required a pay scale in job postings, for employers with fifteen or more employees, since 2023. Most employers responded by publishing a range wide enough to be safe: the bottom of the grade to the top, or the full span of a job family.
That is no longer compliant. SB 642, effective 1 January 2026, defines a pay scale as a good faith estimate of the salary or hourly wage range the employer reasonably expects to pay for the position upon hire. Not the range the role could theoretically occupy after five years. What you expect to pay the person you are hiring, now.
Two further amendments in the same bill change the risk arithmetic.
- Wages now means more than salary. For equal pay purposes, the term reaches bonuses, stock, stock options, profit sharing and other forms of compensation. A structure that is level on base pay and uneven on bonus is no longer a structure that is level.
- The limitations period moved from two years to three, with a six-year lookback on damages. A range you publish this month is discoverable evidence in a claim filed in 2029, measured against pay decisions reaching back further still.
Put those together with the pay data report and the picture is uncomfortable in a specific way. You are publishing, in every job advertisement, a public statement of what a role is worth. You are filing, annually, a confidential statement of what you actually pay. And you are keeping both for years. The two documents will eventually be read side by side, and if the published range and the filed distribution don’t tell the same story, the difference is the case.
Which means the fix is structural, not editorial
The common response to a pay scale requirement is to write better ranges. That is backward. A range is an output. If you produce it by asking what number will attract candidates without alarming the incumbent, you have produced a marketing figure and called it a pay scale.
The order that actually works runs the other way:
- Job architecture first. What are the actual levels, what distinguishes one from the next, and which roles sit at each. Most organizations of twenty-five to five hundred have titles that accumulated rather than levels that were designed, and the two are not the same thing.
- Then the structure. A range per level, built against market data you can identify by source and date, with a defined midpoint and a defined spread.
- Then the hiring range. Within the level’s range, the band you expect to pay a new hire. That is what SB 642 asks you to publish, and if the structure exists, publishing it costs nothing.
- Then the offer. Inside the published range, with the reason for the position within it written down at the time. Not later.
Done in that order, the pay scale in the advertisement is a fact about your structure rather than a number somebody chose. It is defensible for the same reason it is easy to write.
Two things to check in every posting before it goes out
While the posting template is open, there is a second requirement worth confirming, because it is unrelated to pay and routinely violated by templates written before 2025.
Since 1 January 2025, it has been unlawful under the Fair Employment and Housing Act to state in a job advertisement, posting, application or other material that an applicant must hold a driver’s licence, unless two things are both true: you reasonably expect driving to be one of the functions of the position, and you reasonably believe that performing that function using an alternative form of transportation would not be comparable in travel time or cost to you. The statute names the alternatives, including ride-hailing, taxi, carpooling, bicycling and walking.
“Valid driver’s license and clean driving record required” has sat in the boilerplate of a great many California job descriptions for decades, including for roles that involve no driving at all. It is now an advertisement of a violation, publicly posted, indexed, and dated.
If you post positions on behalf of a client, both points carry the client’s name, not yours. That is a reason to hold the template to a standard higher than the one the client asked for.
What to do between now and 13 May
- Confirm you can derive weeks worked from your payroll data. If you cannot, that’s your entire remaining timeline.
- File. Then read what you filed, band by band, and write down what explains anything that looks odd.
- Confirm the demographic data you used is now held separately from personnel records, and that whoever assembles next year’s report knows where it lives.
- Pull the last ten job postings you published and test each range against the good faith estimate standard. Then fix the template, not the postings.
The filing takes a week. The structure behind it takes a quarter. Only one of those is due on 13 May, and only one of them is what the report is actually measuring.
Sources
- California Civil Rights Department, pay data reporting, frequently asked questions and reporting handbook, calcivilrights.ca.gov.
- Chaptered text of SB 464 and SB 642, 2025 session.
- Government Code section 12940, subdivision (q), on driver’s license requirements in job advertisements.
This describes general California employment requirements. It is not legal advice about your organization, and it does not account for a collective bargaining agreement, an industry-specific order, or a local ordinance that may change the answer.