Salary Transparency Laws in California: What Employers Must Disclose

California's Salary Transparency Act (Labor Code § 198.5, effective January 1, 2023) establishes the strongest salary disclosure requirements in the nation. The law applies to employers with 15 or more employees and requires disclosure of the salary range in job postings for any position in California, whether posted by the employer or a third-party recruiter. The range must be sufficiently specific to provide meaningful information; vague or excessively broad ranges do not comply. The statute defines "salary range" as the minimum and maximum annual compensation, excluding benefits.

Unlike federal law, California mandates not only transparency in recruitment but also pay equity investigations. When an employee requests it, employers must disclose the salary range for their position and all substantially similar positions within the employer's pay grade system. Employers cannot retaliate against employees for requesting this information or for disclosing their own pay to coworkers. California's law is substantially stronger than federal baseline because it proactively requires public disclosure rather than waiting for complaints. Employers with fewer than 15 employees are exempt from the job posting requirement under state law, though smaller employers may still be subject to the Equal Pay Act. Remedies include civil penalties of up to $10,000 per violation, back pay awards, and attorney's fees, making enforcement economically significant.

Employers with fewer than 15 employees are exempt from the job posting salary range requirement, but are still subject to equal pay laws and retaliation prohibitions. The law applies only to positions that applicants can apply for in California; positions solely in other states are excluded. Independent contractors, interns, and unpaid volunteers are generally excluded from salary transparency requirements, though remote workers who would work in California fall under the law.

Employers may justify pay differences based on merit systems, seniority systems, quality or quantity of production, or factors other than sex, race, ethnicity, age, or disability. However, the burden is on the employer to prove the defense. Salary history inquiries are separately restricted under California law (Labor Code § 432.3); employers cannot ask applicants about prior wages, though applicants may voluntarily disclose. Confidentiality agreements or non-disparagement clauses that restrict employee discussion of pay are void under Labor Code § 232.

Unions and collective bargaining agreements are not exempt, though the agreement may specify pay ranges differently from at-will employment. Government employers are subject to different rules—public sector salary information is typically public record and transparency requirements may exceed private sector rules. If an employer in multiple states uses a single system and cannot isolate California positions without undue burden, good-faith efforts to comply may be considered, but the employer bears the burden of proof.

Step 1 — Document Everything: Keep copies of the original job posting, any follow-up correspondence with the employer, and the date you applied or were hired. If the employer failed to include a salary range in a job posting, save screenshots or PDFs with timestamps. If you made a request for salary information, send it via email so there is a written record. Document any retaliation (negative performance reviews, reduced hours, termination) following your request or pay discussion. Keep personal records of your duties and compare them to job descriptions for "substantially similar" positions.

Step 2 — Internal Complaint Process and Why It Matters: Before filing a formal complaint, consider sending a written request to HR or management requesting the salary range for your position and substantially similar positions within your pay grade. Use email so you have a record. Reference Labor Code § 198.5 and ask for the information within 10 business days. Document the response or lack thereof. An internal complaint establishes good faith and may lead to quick resolution; employers sometimes correct violations immediately when confronted. However, internal complaints are not legally required—you may proceed directly to external agencies. Document any response you receive and whether the employer met your deadline.

Step 3 — File a Wage Claim or Discrimination Complaint: For salary range non-disclosure, file a wage claim with the California Department of Industrial Relations, Division of Labor Standards Enforcement (DLSE) using Form DLS 140, available at dir.ca.gov/dlse. For retaliation or discrimination in pay decisions, file with the California Department of Fair Employment and Housing (DFEH) at dfeh.ca.gov or call 1-800-884-1684. You may file both simultaneously. Include the job title, dates employed, the salary range you requested, the range the employer provided or refused to provide, and any retaliation. The filing deadline is 1 year from the violation. Filing fee: free. You do not need an attorney to file.

Step 4 — Investigation Process: DLSE or DFEH will send the employer a copy of your complaint and give them 10 business days to respond. The agency will investigate, requesting payroll records, job descriptions, and communications. This typically takes 30–90 days. The agency may issue a citation or determination letter. If violations are found, the employer may be ordered to pay penalties, back wages, and your attorney's fees. If you disagree with the determination, you can appeal or sue in civil court. DFEH investigations for discrimination (race, gender, age-based pay gaps) may lead to settlement conferences. Expect the process to take 3–6 months.

Step 5 — When to Consult an Attorney: Consult an employment lawyer if: (1) the employer retaliates after your complaint; (2) the wage violation is substantial or affects multiple employees; (3) there is evidence of intentional discrimination in pay; (4) the employer disputes the investigation findings; or (5) you plan to sue for additional damages. Most employment lawyers work on contingency (no upfront cost) and recover attorney's fees from the employer if you win. California law provides for attorney's fees in wage claims, making it economical for attorneys to take these cases.