The California Civil Rights Department (CRD) has updated and expanded on the pay reporting required in 2026. Pay reporting is due May 13, 2026.  The CRD published preliminary reporting sheets and FAQs for employers with 100 or more employees who have locations in California.  The employee count is based on total employees (full-time, part-time, etc.) in the U.S., including California.  The requirements also include a separate report by employers who engage labor contractors.

For Reporting Year 2025, CRD introduces three new data elements that employers must capture: (1) exemption status, (2) employment type, and (3) weeks worked during the reporting year.   

Per CRD, employers filing the pay reports should identify whether each California employee is exempt from the minimum wage and overtime pay provisions of the California Industrial Welfare Commission wage orders and/or the federal Fair Labor Standards Act. Employers should classify each California employee into one of two categories according to their exemption status: “Exempt” or “Non-exempt.”

It’s also important to note that California’s exempt/non-exempt classification does not totally follow U.S. law under the Federal Labor Standards Act (FLSA).  To be exempt in California, an employee:

• must generally meet a strict duties test. For most exemptions, more than 50 percent of an employee's time must be spent performing exempt job duties;
• must make an annual salary of $70,304, up from $68,640 in 2025, and simply paying an employee a salary does not make them exempt, nor does it change any requirements for compliance with wage and hour laws; and
• must customarily and regularly exercise discretion and independent judgment in their jobs. Discretion and independent judgment involve comparing and evaluating possible courses of action and deciding after considering various possibilities.

The exempt/nonexempt status is based on California law only.

As to employment type, employers should classify each California employee into one of three

employment types: “Full-time,” “Part-time,” or “Intermittent.”  The definitions of these three types are as follows:

• Full-time: An employee who is assigned to regularly work full-time hours under the

employer’s standard or alternative workweek schedule

• Part-time: An employee who is assigned to regularly work less than full-time hours under

the employer’s standard or alternative workweek schedule

• Intermittent: An employee who is assigned to periodically or irregularly work full-time or part-time hours, under the employer’s standard or alternative workweek schedule (also known as contingent)

To calculate work weeks during the year, the employer should identify the number of weeks worked by each California employee including weeks during which the employee was on any form of paid time off (such as vacation time, sick time, or holiday time).

Same as in the past, for each establishment, covered employers should identify the number of California employees in each employee group created by classifying employees based on race/ethnicity, sex, job category, pay band.  To add complexity to the reporting, the employee group needs to be broken down by exemption status and employment type. For example, if reporting on Hispanic Males in the same job category (which are EEO-1 categories) and pay bands (predetermined salary ranges established in the report), they would need to be separated and reported based on exemption status and employment type.

Although weeks reporting is new, hours per year is still required for reporting for each employee group in the aggregate.  Per CRD:

If the employer does not maintain records of the actual hours worked by an exempt employee, then hours worked includes the employee’s total number of days actually worked during the reporting year, plus the total number of days the employee was on any form of paid time off, multiplied by the average number of hours worked per day by the employee. The average number of hours worked per day may be a reasonable estimation based on available information.

In reporting on labor contractor employees, hours worked includes the actual number of hours worked by the labor contractor employee for the reporting client employer.

Also new in 2026 is the reporting of employees who are Middle Eastern or North African (MENA).  Most employers may not be collecting that information at this time, but be aware that California will require it, so talk with your HRIS vendor about collecting that information.  The U.S. at this time has put a hold on collecting this data.
Finally, when reporting salary, the reporting requires “Mean Hourly Rate,” and “Median Hourly Rate,” which is based on all employees’ hourly rate in the same employee category.  This is the same as past reporting.  For more information on the California reporting, go to 2025 Preliminary Templates and FAQ | CRD. Any updates before the reporting cycle starts will be reported by ASE.

Source:   California Civil Rights Department, Seyfarth Shaw 12/18/25