Today is International Women’s Day. The day marks a call to action for accelerating gender parity.
In our global gender pay gap thought leadership series, we’ve highlighted the numerous ways governments around the world are taking actions aimed at closing the gap. In the US, the movement to prohibit the practice of inquiring about an applicant’s salary history continues to gain steam. Cities and states across the country have enacted legislation making it unlawful to inquire about prospective employees’ salary history. Proponents of salary history bans argue that using past compensation in future employment decisions perpetuates existing pay disparities among women and minorities.
The tricky part for multi-state employers is that each new law has its own twist, for instance, California’s ban applies to employers and their “agents.” California’s law also requires employers to provide the pay scale for a position to an applicant upon reasonable request. Many other states and municipalities, however, have less clear guidance.
To help you track these recent developments, we’ve summarized salary history bans in the US in the table below. (Of course, always check to see if any local legislation applies.)
|City, State or Territory||Restriction||Nuances to note|
|Albany County, NY||For employers with 4 or more employees, effective in 2018, the local law prohibit employers from requesting, requiring, or screening based on an applicant’s current or former wages, including benefits and other compensation.||Employers may confirm an applicant’s prior wages, including benefits, other compensation, or salary history, after both:
Effective January 1, 2018, all California employers prohibits employers from asking applicants about their salary history.
Pursuant to Labor Code Section 432.3, employers (and their agents) cannot:
|Connecticut||Effective January 1, 2019, except when certain limited exceptions apply, all employers cannot:
||“Wages” are defined as compensation for labor or services, whether the amount is determined by: time, task, piece, commission, or other basis of calculation. “Wages” does not include “other elements” of an applicant’s compensation structure, if the employer does not inquire about the value of those other elements.|
|Delaware||Effective December 14, 2017, all Delaware employers and their agents:
|Hawaii||Effective January 1, 2019, all employers are prohibited from:
||The salary history ban does not apply to either:
|Massachusetts||Effective July 1, 2018, it is unlawful for any MA employer and their agents to seek an applicant’s wage or salary history before making an offer of employment.||Nothing in the law prohibits an employer from asking a prospective employee about their compensation needs or expectations.|
|New York, NY||Effective October 31, 2017, all NY city employers are prohibited from asking about an applicant’s salary history.||The salary history ban does not apply to either:
|Oregon||Beginning October 6, 2017, all Oregon employers are prohibited from seeking an applicant or employee’s salary history.||Compensation includes: wages, salary, bonuses, benefits, fringe benefits and equity-based compensation. It does not include tips.|
|Philadelphia, PA (*PENDING)||Philadelphia’s Wage Equity Ordinance prohibits employers from inquiring about an applicant’s wage history or conditioning consideration for an interview or employment on disclosure of that information.||The ordinance was scheduled to take effect in May 2017. Implementation was delayed pending a legal challenge; litigation is still ongoing.|
|San Francisco, CA||Generally speaking, the ordinance – effective July 1, 2018 prohibits 3 things:
|Suffolk County, NY||Employers with 4 or more employees, effective June 30, 2019, employers are prohibited from inquiring about, or relying on when determining compensation, an applicant’s wage or salary history.|
|Vermont||Effective July 1, 2018, employers are prohibited from inquiring about, seeking, requiring, or screening for interview purposes based on information about an applicant’s current or past compensation.||Employers may inquire about a prospective employee’s salary expectations or requirements.|
|Westchester County, NY||Effective July 9, 2018, the local law prohibits employers (with 4 or more employees) and other covered entities generally from relying on, requesting, requiring, or seeking an applicant’s current or former wages.||Employers and other covered entities may rely on prior wage history to determine an applicant’s wages if:
|Puerto Rico||Effective March 8, 2017, employers are prohibited from requesting an applicant’s salary history from the applicant or their former employer.|
Outside the US
Outside of the US, we have not seen comparable efforts to prohibit salary history inquiries, with the notable exception of legislation in Canada. Ontario’s Pay Transparency Act proposes requirements concerning disclosure of compensation particulars of employees and prospective employees. In addition, and among other things, the Act would prohibit employers from asking candidates about their compensation history, whether personally or through an agent, with few exceptions. However, for now, the law is not in effect – it is currently on hold to allow the government to engage in public consultations. (Read more HERE.)
Efforts to close the gender pay gap outside the US have focused primarily on transparency and representation. The UK and Australian governments have recently focused their efforts on representation and the gender pay gap, requiring employers to publish data about the difference in average pay between men and women. In the UK, gender pay gap data is made available for public use, whereas in Australia the government publishes aggregated pay gap data from which individual companies cannot be identified. Other countries across Europe have also recently introduced pay transparency legislation (e.g. Germany and France). (Ireland and Spain are also considering similar legislation.)
In “no ask” jurisdictions, it is recommended that employers:
- Remove all salary questions from hiring forms (including job applications, candidate questionnaires, and background check forms);
- Update interviewing and negotiating policies and procedures;
- Train recruiters, hiring managers and interviewers regarding the importance of ensuring that applicants are not pressured (even indirectly) to disclose salary history.
It is further recommended that employers adopt a uniform practice that complies with the strictest “no ask” jurisdiction in which the employer operates. A uniform practice will help to avoid non-compliance.
For assistance developing your compliance playbook as it relates to gender pay and pay equity obligations in the US and globally, please contact your Baker McKenzie employment lawyer.