In today’s post, I’m going to go over what is often referred to as the “Pink Tax” or the practice of charging more for products aimed at women simply even when the same product for men, for instance, has a lower price.
In September of 2022, the California Legislature passed Assembly Bill (AB) 1287 which became effective as of January 1, 2023. AB 1287 added a new section — Section 51.14 — to the California Civil Code. As always, I encourage to actually look up the entire text of the statute section. I am only going to point out the major parts of Section 51.14.
The main part, in my opinion, is Section 51.14(b), which says:
“A person, firm, partnership, company, corporation, or business 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.”
If you’re wondering what terms like “business” or “substantially similar” mean, that’s described in Section 51.14(a). As an example, “substantially similar” is defined as (1) there being no substantial difference in the materials used to make the item, (2) the intended use of the items are similar, (3) the functional design and features of the items are similar, and (4) the brand of the items is the same or the brands of the items are owned by the same party. I bolded and underlined “and” above to emphasize that (1) to (4) must all be true simultaneously in order for the items to be “substantially similar” within the meaning of Section 51.14 as AB 1287 envisioned the term.
In my view, the other major part of Section 51.14 is 51.14(c) which describes situations in which the price of two items can be different. These situations include:
- differences in making the items that are due to the time, difficulty, cost, labor, or materials involved in making the items. I hope that everyone can agree that this makes logical sense. If the version of an item aimed at women is more difficult to make or requires more expensive materials, that difference should be reflected in the price charged for that item.
- The time, difficult, cost, labor, or materials involved in the manufacture of the items is not an exhaustive list. Under Section 51.14(c)(6), any “gender-neutral reason for charging a different price” for the items is allowed.
As a lawyer in the private sector, I’m obviously disappointed that there is no right for individuals to sue for violations of Section 51.14. The only enforcement mechanism specified in Section 51.14 is under 51.14(d). In short, only the California Attorney General can enforce Section 51.14. The penalty for violations of Section 51.14 can be steep. Section 51.14(d)(3) says that violations for first offenses are capped at $10,000 with max penalties of $1,000 for each subsequent violation.
There is a cap of $100,000 for all civil penalties imposed for violations. Personally, I find this odd and makes me wonder if a set amount like that will incentivize certain companies or businesses to continue levying a Pink Tax because the $100,000 is simply a cost of doing business.
I hoped this helped. As always, this post is intended as a superficial discussion only. If you have a situation involving, for example, a business or company who has violated Section 51.14 by charging different prices solely due to gender, you must absolutely do your own research because it is entirely possible I may have overlooked or not mentioned something that would be hugely-relevant for your particular situation. I’ve included a bunch of links throughout this post which should help you with your research.
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