Cameron Miranda
Salary history bans are laws that prohibit employers from requesting salary history information from job applicants. These laws aim to end the cycle of pay discrimination, which has been shown to contribute to gender inequality and widen the wage gap between men and women. While there is currently no federal law banning salary history inquiries, individual states and localities have started adopting their own regulations. As of November 2024, 17 states and 17 localities have enacted salary history bans, with more expected to follow. These bans not only prohibit employers from asking about salary history but also from relying on known salary histories when making job offers. To stay compliant, employers should review their hiring processes and train their staff accordingly, removing any references to salary history from job applications, interview scripts, and job offers.
Characteristics and Values
| Characteristics | Values |
|---|---|
| Salary history ban | 22 states and 23 localities have banned employers from asking about salary history |
| Purpose | To reduce pay discrimination and end the cycle of pay disparity between men and women |
| Applicability | Varies in terms, scope, and applicability |
| Compliance | Avoid fines or penalties |
| Exceptions | Salary history can be requested if it is required by federal, state, or local law |
| Voluntary disclosure | Applicants can voluntarily disclose salary history to justify a higher salary |
| Salary expectations | Employers can ask about salary expectations instead of salary history |
| Salary research | Researching salary ranges is essential for creating a competitive and fair compensation package |
| Pay scale | Employers must provide the pay scale for a position upon the applicant's request |
Explore related products
What You'll Learn
Salary history bans by state
Salary history bans are laws that prohibit employers from requesting information about a job applicant's salary history. These laws are intended to protect employees from discrimination, ensure that everyone has a fair chance at earning a living wage, and address the gender wage gap. As of 2021, there are 17 state-wide salary history bans in the United States, including the Commonwealth of Puerto Rico, 17 local bans, 2 laws prohibiting bans, and 1 legal challenge to a ban.
State-wide Salary History Bans
- California: The state's ban prohibits private and public employers from seeking a candidate's pay history. Even if the employer already has this information or the applicant volunteers it, it cannot be used to determine a new hire's pay.
- New York: A previous executive order from January 2017 prohibits state departments and agencies from requesting salary history from applicants until after an offer is made.
- New Jersey: A previous executive order from February 2018 prohibits state agencies and offices from asking job applicants for their compensation history or investigating their prior salaries.
- Massachusetts: The state has adopted a law banning employers from requesting salary history information from job applicants.
- Hawaii: Similar to Massachusetts, Hawaii has also implemented a law that prohibits employers from asking for salary history information from applicants.
Local Salary History Bans
Some cities have also implemented their own salary history bans, including:
- New York City: The city has a law that bans employers from requesting salary history information from job applicants.
- San Francisco: A city ordinance prohibits employers from asking for and considering a job applicant's current or prior compensation when setting pay. It also bars them from disclosing an employee's salary information without their consent.
- Atlanta: The city has announced that it will not ask for salary history on its employment applications, verbal interviews, or employment screenings.
Senate's Power: Laws Without House?
You may want to see also
Explore related products
Employers' alternatives to salary history
In the US, federal and state laws are increasingly being adopted to prohibit employers from requesting salary history information from job applicants. The aim is to end the cycle of pay discrimination, particularly against women, and to promote equal pay for equal work.
Salary expectations
Employers may ask applicants about their salary expectations for the role. This can give a sense of whether the candidate's expectations are in line with the company's budget without needing to know their salary history.
Salary range
Employers can provide applicants with a salary range for the position. This can be done in response to an applicant's request for the salary range or proactively during the application or interview process. Providing a salary range can help set expectations and attract candidates who are comfortable with the offered range.
Conditional offer stage
In some states with salary history bans, employers are permitted to seek salary history information after making a conditional offer of employment. This means that while salary history cannot be used as a screening tool, it can be considered as part of the final negotiation process.
Market value and skill set
Instead of focusing on salary history, employers can evaluate applicants' market value and skill set. This can involve researching the going rate for similar roles in the region and assessing the candidate's experience and qualifications. This approach ensures that the salary offered is based on the current market and the specific skills required for the position rather than an individual's salary history.
Internal pay scales
Employers can develop and adhere to internal pay scales for different roles within the organization. This ensures that salaries are based on the responsibilities and requirements of each position rather than an individual's salary history.
By adopting these alternatives, employers can ensure they are complying with relevant laws, promoting equal pay practices, and attracting a diverse range of applicants.
Bolsonaro's Indigenous Land Grab: Law Change on the Horizon?
You may want to see also
Explore related products
Salary history and gender inequality
In the United States, federal law does not prohibit employers from requesting a candidate's salary history. However, several states and municipalities have enacted bans on asking for previous salary information to address the inequality that this practice perpetuates. These include California, San Francisco, New York, New Jersey, Atlanta, and Puerto Rico.
The gender wage gap, or the disparity in incomes between men and women for performing the same work, has narrowed since the 1960s but remains significant. In 2022, American women typically earned 82 cents for every dollar earned by men, a figure that has barely changed in the past two decades. This gap is influenced by various factors, including occupational segregation, gender stereotypes, and discrimination. Mothers between the ages of 25 and 44 are less likely to be in the workforce and tend to work fewer hours, reducing their earnings. On the other hand, fathers of the same age group are more likely to be employed and work longer hours, resulting in a "fatherhood wage premium" that widens the gender pay gap.
Women also tend to avoid salary negotiations and are predisposed to accept tasks with low promotion potential. However, these observed differences are not biologically fixed but are influenced by societal factors and can be changed. Additionally, women's historical advancement in specific professions, such as pharmacists in the US, suggests that the gender pay gap could be reduced if firms did not disproportionately reward long work hours and fixed, non-flexible schedules.
To address the gender wage gap, some states have implemented laws and regulations that prohibit employers from requesting salary history. These laws aim to break the cycle of pay discrimination and prevent employers from relying on an applicant's pay history to set compensation. By complying with these laws, employers can help create a more level playing field for all workers.
While progress has been made, closing the gender wage gap remains a focus for governments, nonprofit organizations, and businesses. Implementing family-friendly labor-market policies and encouraging women's investment in education can help narrow the gap and create a more equitable society.
Law Firm as Registered Agent: Is It Possible?
You may want to see also
Explore related products
![Compliance [Blu-ray]](https://m.media-amazon.com/images/I/712fZO6aOlL._AC_UY218_.jpg)
Salary history and pay discrimination
Salary history bans are laws that prohibit employers from requesting salary history information from job applicants. These laws aim to end the cycle of pay discrimination, particularly against women and people of color, and create a more level playing field for all workers. As of 2021, there were 17 state-wide salary history bans, 17 local bans, 2 laws prohibiting bans, and 1 legal challenge to a ban in the United States.
In the past, requesting job applicants' salary histories has been a common practice for employers. However, this information has often been used to exclude people from the candidate pool or to offer lower salaries to new hires. This has perpetuated a discriminatory wage disparity between men and women, as well as racial minorities. To address this inequality, several states and municipalities have enacted bans on asking for previous salary information.
The laws regarding salary history bans vary in terms, scope, and applicability. Some laws prohibit employers from requesting salary history information, while others also prohibit employers from relying on an applicant's pay history to set compensation, even if it is voluntarily disclosed. Some laws require employers to provide a salary scale for a position upon the applicant's request. It's important to note that some states do not have these laws, so employers may be able to ask about salary expectations.
Despite the existence of these laws, there is still a compliance challenge for employers operating in multiple jurisdictions. Additionally, the United States Supreme Court has declined to review a case regarding pay discrimination and salary history, leaving a split among the circuit courts as to whether prior salary is a factor in pay discrimination. As a result, employers must carefully evaluate both federal and state laws when deciding whether to consider prior salary while setting pay for any employee.
State Law vs Constitution: Who Wins?
You may want to see also
Explore related products
![Law of Governance, Risk Management and Compliance: [Connected Ebook] (Aspen Casebook)](https://m.media-amazon.com/images/I/616gNHR5shL._AC_UY218_.jpg)
Salary history and the law in New York
Salary history bans are becoming increasingly common across the United States, with 17 state-wide bans, 17 local bans, 2 laws prohibiting bans, and 1 legal challenge to a ban currently in place. These laws aim to address the inequality and discrimination in the workplace perpetuated by salary history inquiries, which can result in a wage gap between men and women.
In New York, a law has been enacted to ban employers from seeking, requesting, or requiring the wage or salary history of an applicant or current employee as a condition of their employment, promotion, or hiring. This law goes beyond previous local prohibitions in New York City, Albany, Suffolk, and Westchester, as well as those in other jurisdictions like Massachusetts and California, by restricting not only inquiries but also reliance on such information.
The New York law amends the New York Labor Law by adding a new Section 194-a, which prohibits employers from relying on the wage or salary history of an applicant when deciding whether to offer employment or determining the wages or salary of such an individual. This means that employers cannot ask for or use an applicant's wage or salary history as a factor in their decision-making process.
However, there is an exception to this law. Applicants or current employees are not precluded from voluntarily disclosing their wage or salary history, including for the purposes of negotiating wages or salary. Nevertheless, the law does not explicitly permit employers to "rely" on this voluntarily disclosed information when setting the applicant's wage or salary, creating an apparent inconsistency. The New York State Department of Labor (DOL) has not provided clear guidance on this matter, and employers are left with compliance challenges.
To ensure compliance with the law, employers in New York should refrain from seeking or requesting salary history information from applicants or current employees and not use such information if it is voluntarily disclosed. Instead, the focus should be on skills and qualifications when determining employment, promotion, and retention decisions.
LLC or Not: The Texas Law Firm Conundrum
You may want to see also
Frequently asked questions
No, they cannot. While there is no federal law in place, 22 states and 23 localities have banned employers from requesting salary history.
The laws aim to end the cycle of pay discrimination, particularly regarding gender inequality. Asking for salary history can limit a worker's earning potential.
If you are in a state or locality with a salary history ban, you can contact the Department of Labor's Division of Labor Standards. They have a phone number and email address set up for such complaints.
