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The law, AB 1287, states that a business or other entity “shall not charge a different price for any two goods that are substantially similar if those goods are priced differently based on the gender of the individuals for whom the goods are marketed and intended.”
In the bill, “[s]ubstantially similar” means two products where there are “[n]o substantial differences in the materials used in production,” “[t]he intended use is similar,” “[t]he functional design and features are similar,” and “[t]he brand is the same or both brands are owned by the same individual or entity.”
However, the law notably allows price disparities for specific reasons. It points out that costs of items can be different if the price is based on how much time it takes to make the items, how difficult it is to make them, the “cost incurred in manufacturing,” “[t]he labor used,” [t]he materials used,” as well as “[a]ny other gender-neutral reason for charging a different price for those goods.”
A company could face a fine of $10,000 for an initial violation, and $1,000 for each following violation, not totaling to more than $100,000.
The legislation is directed towards what critics refer to as the “pink tax,” which claims that women’s items are marked up from men’s items, even when the product is the same as something marketed to men.
“The ‘Pink Tax’ is a gender based penalty that harms women who are already paid less,” Assemblywoman Rebecca Bauer-Kahan, who introduced the legislation, reportedly said in a statement. “This type of arbitrary gendered pricing has no place in California. It’s long past time to eliminate this type of inequality. I’m grateful Governor Newsom has signed this bill to ensure price equality in California.”
“Simply being a woman shouldn’t cost money – but it does,” Holly Martinez, Executive Director of the California Commission on the Status of Women and Girls, which assisted in writing the bill, said.
“These measures bring new transparency to tackle pay gaps, end discriminatory pricing of products based on gender and expand supports for survivors of abuse and assault,” Governor Newsom said. “California has the strongest equal pay laws in the nation, but we’re not letting up on our work to ensure all women in our state are paid their due and treated equally in all spheres of life.”