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October 25, 2022

EQUAL PAY TRANSPARENCY (EPT) LAW & PERM LABOR CERTIFICATION PROCESSING IN CALIFORNIA

Equal Pay Transparency (EPT) Law will become effective in California on January 1, 2023.

Starting January 1, 2023, employers in California with 15 or more employees will be required to post pay ranges in their written job postings. Regardless of how many people they employ, all employers in California will be required to disclose the pay range for a given position to job applicants who request that information. In addition, all employers must maintain job title and pay history records for each employee for the duration of employment plus three years after the end of employment.

The requirements to publish pay in job postings will impact employers’ Program Electronic Review Management (PERM) labor certification programs, specifically labor market testing activities initiated prior to the issuance of Prevailing Wage Determinations (PWD).

The regulation at 20 C.F.R. § 656.10(c) requires an employer to certify the conditions of employment listed in its application, including that:

(1) The offered wage equals or exceeds the prevailing wage determined pursuant to § 656.40 and § 656.41, and the wage the employer will pay to the alien to begin work will equal or exceed the prevailing wage that is applicable at the time the alien begins work or from the time the alien is admitted to take up the certified employment.

 

This section also states that an employer’s failure to attest to any of the conditions of employment listed will result in denial of the application.

Additionally, the Preamble to the PERM Final Rule concerning the labor certification process specifically discusses the use of wage ranges in recruitment. With respect to advertisements, the Preamble states:

“We have not modified the regulations to specifically permit wage ranges; however, consistent with our longstanding policy, the employer may advertise with a wage range as long as the bottom of the wage range is no less than the prevailing wage rate.”

69 Fed. Reg. 77348 (December 27, 2004). Thus, to the extent that employers include a wage range to advertise the job opportunity, they may not offer a wage rate lower than the prevailing wage. This refers to all advertising efforts, including the job order the employer placed with the SWA. 69 Fed. Reg. 77343 (December 27, 2004).

Thus, based on the foregoing, in cases where labor market testing efforts have begun prior to obtaining a PWD where EPT law mandate posting wages or wage ranges, efforts identifying offered salaries will have to be reposted if the PWD comes back higher than the posted/offered salary or lower end of a range.

Note that EPT law does not change the PERM regulations. Therefore, employers testing the labor market in California will have to incorporate the EPT law into their PERM practices and should consult with local employment counsel to ensure adherence to the EPT rules.

Should you have any questions about PERM Labor Certification program in California, please reach out to Attorney Rabi Singh. He can be reached via email at: rsingh@hsdimmigration.com or phone at 312.291.1234.

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