California Updates Pay Data Reporting Requirements

October 29, 2025

What's New

California recently amended its Pay Data Reporting obligations, which require covered employers to submit employee and labor contractor pay data reports annually to the Civil Rights Department (CRD).

Under the amendment, beginning with the May 2027 filing, employers must classify and report employee data using the 23 “major group” Standard Occupational Classification (SOC) system job categories, replacing the 10 EEO-1 categories previously used.

In addition, starting in 2026:

1. employers must store demographic data separately from personnel records, and
2. penalties for failing to file Pay Data Reports will become mandatory if requested by CRD.

The amendment clarifies that an employer can be fined if a labor contractor fails to provide required data, but penalties may be shifted to the contractor.

What It Means

The annual California Pay Data Report will remain relatively unchanged in 2026. However, there will be a risk of mandatory fines for failure to timely file, even for labor contractor violations. The amendment also requires employers to maintain demographic data separate from personnel files.

The Pay Data Report will look notably different starting in 2027, when employers will have to use the 23 SOC major groups when filing the report.

What You Should Do

Employers should gather Pay Data Report data as soon as practicable in the new year, and to avoid fines, should keep good records of data requests to labor contractors. In 2026, employers should begin mapping employees’ current roles to SOC major groups to ensure these assignments are ready to go for the 2027 filing.

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