Written by: Paul Barnes | June 12, 2021

Introduction

Today we will look at California bill AB1287. This bill would change California discrimination law to prevent some forms of price discrimination based on gender, sometimes called the “pink tax”.

As of 6/11/2021, the bill is in committee and has been since 5/5/2021, its hearing was postponed on 5/20/2021. Because the bill did not pass out its chamber of origin by the crossover deadline of June 5, it is effectively dead.

AB1287 has a number of different sponsors, all of which are Democrats. The sponsors are the following people; Rebecca Bauer-Kahan (D)*, Autumn Burke (D)*, Sabrina Cervantes (D)*, Cristina Garcia (D)*, Lorena Gonzalez (D)*, Tasha Horvath (D)*, Marc Levine (D)*, Evan Low (D)*, Adrin Nazarian (D)*, Robert Rivas (D)*, Ben Hueso (D), Connie Leyva (D), Scott Wiener (D),

This blog post will cover the bill and how it would have changed existing California law. (For a national look at this issue, see this post from last year.)

Background

Currently in California businesses are not allowed to change the price for a service of similar types based solely on an individual’s gender. Additionally, the prices for specific services must be in writing and disclosed to customers, a full list of services and their prices must be provided upon request. However, the law currently does not apply to goods.

AB1287 seeks to change this flaw by providing protections for consumers by prohibiting businesses from having separate but similar goods for each gender that have different prices.

What This Bill Does

AB1287 would prohibit any person, firm, partnership, company, corporation, or business from charging a different price for any two goods (consumer products) that are “substantially similar” if they are priced differently based on the gender of who they are marketed towards.

According to the bill, substantially similar means two goods that have all of the following characteristics

No substantial differences in the materials used
Similar intended use
Design and features are similar
Same brand

Additionally, color does NOT count as a substantial difference and two products that have the only difference being the color count as similar products. For example, a toothbrush that is blue for men that costs $10 and one that is pink for women and costs $11 would be counted as a substantially similar product that is in violation of this bill.

What This Bill Does Not Do

This bill enumerates many reasons for a price differential which do justify a price difference, including the following;

The amount of time it took to make the good
The difficulty in making the goods
The cost of making the good
The labor used in making the good
The materials used in making the good
Any other gender neutral reason for the price change

Companies are not not being prevented from charging more for a product because of a legitimate higher cost of production, hence companies will NOT be forced to charge the same price for two similar products if one of them costs more to make.

What Happens If Someone Violates This Law?

If someone is found to have violated this law, the Attorney General can issue an injunction, after which the violator has five days to stop the violation. The courts can force pricing changes even if there is no proof that anyone was hurt by the defendant’s (the businesses owner/seller) violation of this law.

If a company violates this law they can be fined up to $250 for the first offense and up to $500 for each subsequent offense. All identical items with different pricing are considered one offense; so each product type is an offense, not each individual item.

Opinion – Would This Law Have Done Any Good?

The main issue with this law is that the only real consequence of violating this is quite the small fine. Now for a small business this might be a big deal, but larger businesses could pay the fine quite easily, meaning if they feel they can make more money by just flouting the law, then they will just do that, in which case, this law did not really do much.

The law is a good idea, but I feel like the fine should keep scaling up for subsequent violations, instead of stopping at $500, it could keep rising, doubling each time, but perhaps that is too excessive. At the very least this would prevent larger companies from just ignoring the law.