Vedder Thinking | Articles Employers Questions about Salary History Are History
The New York City Council recently approved legislation that prohibits employers from inquiring about a job applicant’s salary history. The bill was approved on April 5, 2017, just one day after Equal Pay Day. Mayor Bill de Blasio signed the bill into law on May 4, 2017.
The legislation, Int. No. 1253-A, provides that it is an unlawful discriminatory practice under the New York City Human Rights Law for an employer, employment agency or employer’s agent to:
- Inquire about the salary history of a job applicant for employment; or
- Rely on the salary history of a job applicant to determine the applicant’s salary or benefits during the hiring and contract negotiation processes.
The law broadly defines “to inquire” and “salary history.” “To inquire” is defined as “to communicate any question or statement to an applicant, an applicant’s current or prior employer . . . or to conduct a search of publicly available records or reports for the purpose of obtaining an applicant’s salary history.” “Salary history” is defined as “the applicant’s current or prior wage, benefits or other compensation.”
An employer is not prohibited, however, from discussing a job applicant’s expectations regarding salary or benefits. Moreover, if a job applicant voluntarily shares his/her salary history with an employer without any prompting by the employer, the employer may consider the salary history in determining the job applicant’s salary and benefits, and may further verify the job applicant’s salary history.
The legislation includes certain exceptions. For example, the law does not apply to a current employee’s application for internal transfer or promotion. The legislation also does not apply to public employee positions for which salary or benefits are determined pursuant to procedures established through collective bargaining.
Further, the law does not preclude an employer from conducting a background check or verifying a job applicant’s disclosure of information not related to salary. However, if the background check or verification discloses a job applicant’s salary history, an employer may not rely on the disclosure to determine the job applicant’s salary or benefits.
Proponents of the new legislation contend that the law will promote gender pay equity, as they argue that job applicants who were underpaid in the past should not be condemned to always being underpaid. Similar legislation was recently enacted in Massachusetts and in the City of Philadelphia. The Massachusetts law will take effect in July 2018 and the Philadelphia law will take effect in May 2017. Nationwide, over 180 bills have been introduced to reduce the pay gap since 2016.
To comply with this new legislation, employers should amend their written applications, interview questions and on-boarding policies to remove references to a job applicant’s salary history. Further, employers should ensure that all employees involved in the recruitment and hiring process understand how expansively the law defines “inquire” and “salary history.”
The New York City law will take effect on October 31, 2017. The law follows Mayor de Blasio’s Executive Order 21, signed in November 2016, which prohibits New York City agencies from inquiring about a job applicant’s salary history before extending a conditional offer of employment to the job applicant.
If you have any questions regarding this new legislation, please contact Blythe E. Lovinger +1 (212) 407 7770 or any Vedder Price attorney with whom you have worked.
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