California continues to push pay transparency further into the mainstream of employment law. Employers with 15 or more employees now face more detailed requirements for posting wage ranges and reporting pay data. Penalties for missing or incomplete information have increased, and misunderstandings about these rules can lead to significant exposure.

Here is what every California employer should know for 2026.

Expanded Pay Transparency Requirements

Senate Bill 642 strengthens California’s pay transparency laws. Employers must publish a good-faith estimate of the compensation that a position will pay, including all elements of wages that an employee can reasonably expect at the start date. This means employers can no longer list a range that reflects only future negotiated pay, or omit items such as expected bonuses or incentive pay.

SB 642 also clarifies that prohibited discrimination based on sex now includes nonbinary gender identifiers under the Equal Pay Act.

Pay Data Reporting Requirements

California’s reporting regime continues to evolve from the original SB 1162 framework. Employers with 100 or more employees must submit pay data reports to the Civil Rights Department. The job categories that must be reported increased from 10 to 23. Reporting must include the mean and median pay for each job category and demographic group.

Penalties for noncompliance have increased and may apply per employee, per pay period, for missing or incomplete data.

What Employers Should Do Now

Employers should review job postings and internal job descriptions to confirm that salary ranges reflect a good-faith estimate of total pay. Human resources should also prepare for the expanded reporting categories and ensure that internal payroll and job classification systems can generate the required data.

Employers with 100 or more employees nationwide, but only a few in California, must still report on those California employees.

Conclusion

Pay transparency and pay data reporting laws in California are more complex and more punitive than ever. Employers should treat compliance as a priority for 2026. Proper preparation now can protect organizations from costly penalties and avoid claims that stem from unclear or incomplete pay disclosures.