How Will The Laws Banning Salary History Affect Your...

The New York City Council recently approved a bill making it unlawful discriminatory practice to directly inquire with a candidate about their compensation history. The regulation has been passed in hopes of diminishing gender bias, especially when it comes to the gender pay gap. If your firm or client is already aware of the candidate’s compensation history or becomes aware via a public search, this regulation makes it illegal to rely on that information to develop a new compensation package.

Similar laws have already been passed in California, Massachusetts, Philadelphia, Delaware, Oregon, and Puerto Rico.

California's Fair Pay Act has taken effect as of January 1, 2017. Additionally, law AB 168 applies to all California employers, including state and local governments, and will take effect on January 1, 2018.
Massachusetts’ Pay Equity Act will take effect July 1, 2018.
Philadelphia's Wage Equity Bill is in effect as of May 23, 2017. However, the Chamber of Commerce of Greater Philadelphia filed a lawsuit in federal court on April 6, 2017, challenging the Philadelphia law and seeking an injunction.
Delaware's pay equity law will be effective December 14th, 2017.
Oregon's pay equity law is effective October 6, 2017, but will not be enforced until January 1, 2019.
Puerto Rico's law known as the “Puerto Rico Equal Pay Act" is effective immediately. The penalty provisions of Act 16 will not be effective until March 8, 2018, to permit employers to take any mitigating measures.

The Pay Equity for All Act has also been reintroduced into the mix. This bill amends the Fair Labor Standards Act of 1938, making it unlawful for an employer to:

Screen prospective employees based on their previous wages or salary histories;
Seek the previous wages or salary history of any prospective employee from any current or former employer of such employee; or
Discharge or in any other manner retaliate against any current or prospective employee because the employee opposed any act or practice made unlawful by the Act, or made or is about to make a complaint relating to any such act or practice, or testified or is about to testify, assist, or participate in any manner in an investigation or proceeding relating to any such act or practice.

What does this mean for your recruitment team?

If your recruitment team is based in New York City, California, Massachusetts, Delaware, Oregon, Philadelphia or Puerto Rico, you should keep up to date with the latest regulations. Make sure your firm is conscious about the way in which you discuss compensation with your candidates. As this bill goes into effect, you will be prohibited from asking your candidates and any of their employers about their salary history, or even doing public searches on it.