Salary History Questions by Employers Will Be Restricted as Pay Equity Movement Spreads in 2018

Written By ESR News Blog Editor Thomas Ahearn

Several states and cities in the U.S. have passed legislation prohibiting employers from seeking salary history information about job applicants as part of a “pay equity” movement to narrow the gender wage gap between women and men. This growing restriction on questions about the salary history of applicants by employers is trend number 9 of the “ESR Top Ten Background Check Trends” for 2018 selected by global background check firm Employment Screening Resources (ESR).

In 2015, women earned 80 percent of what men earned, according to statistics from the U.S. Census Bureau. The gender wage gap has narrowed by less than one-half a penny per year in the United States since 1963, when Congress passed the Equal Pay Act, the first law aimed at prohibiting gender-based pay discrimination, according to the National Committee on Pay Equity. As a result, several states and cities passed restrictions on salary history questions by employers during the applicant hiring process.

“When employers have a background screening firm perform past employment verifications, it is critical that the screening firm have the knowledge about states and cities that prohibit such questions as well as software that helps facilities compliance,” explains ESR founder and CEO Attorney Lester Rosen, author of ‘The Safe Hiring Manual,’ a guide for employment background checks. “This is another example where background screening is morphing into a legal compliance services, as opposed to merely gathering data.”

In October of 2017, California Governor Jerry Brown signed into law Assembly Bill 168 (AB 168) which prohibits employers from seeking salary history information about job applicants and requires employers to provide the pay scale for a position to applicants upon reasonable request. AB 168 prohibits employers from relying on salary history information of applicants in determining whether to offer an applicant employment or what salary to offer an applicant. The law takes effect on January 1, 2018.

In July of 2017, San Francisco Mayor Ed Lee signed into law the “Parity in Pay Ordinance” to prohibit employers in the city from asking job applicants about their salary history or from considering earnings information in determining whether to hire an applicant and what salary to offer them. The Office of Labor Standards Enforcement (OLSE) will enforce of the ordinance and investigate possible violations. The ordinance will take effect July 1, 2018. Penalties for violating the law begin on January 1, 2019.

In June 2017, Oregon Governor Kate Brown signed into law the Oregon Equal Pay Act of 2017 (HB 2005) which will prohibit employers from screening job applicants based on past or current salary history or seeking information about past or current salary history from job applicants before making them an offer of employment that includes an amount of compensation. The majority of the Act – which also addresses salary disparities among protected classes – is scheduled to take effect on January 1, 2019.

In April 2017, the New York City Council passed legislation – Introduction 1253-2016 – that prohibits employers from inquiring about the salary history of job applicants during the hiring process and also from relying on salary history information to determine salary if that information is already known. Under the law – which took effect October 31, 2017 – “salary history” includes the applicant’s current or prior wage, benefits, or other compensation, but does not include any revenue, sales, or other production reports.

In January of 2017, Philadelphia Mayor Jim Kenney signed Bill No. 160840, a Wage Equity Law that prohibits employers from inquiring about the salary history of job applicants. The law amends Title 9 of The Philadelphia Code entitled “Regulation of Businesses, Trades and Professions” by adding a new Chapter on wage equity prohibiting both public and private employers from inquiring about salary history. The Ordinance was slated to take effect May 23, 2017 but was delayed until October 24, 2017.

Lastly, in August of 2016, Massachusetts Governor Charlie Baker signed a bipartisan pay equity bill – S.2119, An Act to Establish Pay Equity – to prevent wage discrimination on the basis of gender.  The law also prohibits employers from requiring applicants to provide their salary history before receiving a formal job offer to ensure equal pay for “comparable work” for all Massachusetts workers and equal opportunities to earn competitive salaries in the workplace.  The law will take effect on July 1, 2018.

An alert sent by labor and employment law firm Hirschfeld Kraemer LLP advises employers in California to “revise employment application forms to delete questions asking for salary or wage history, train all recruiters and hiring managers not to ask for such information in interviews, and consider asking applicants in writing for salary expectations or requirements instead.” Employers in other states or cities with similar laws restricting questions about salary history should consult their own labor attorneys.

Employment Screening Resources (ESR) – a leading global background check firm headquartered in the San Francisco, California area – will release the 11th annual “ESR Top Ten Background Check Trends” of 2018 via the ESR News Blog during December of 2017. The complete list of emerging and influential trends in the background screening industry for the coming year as chosen by ESR will be available in January of 2018 on the ESR website at http://www.esrcheck.com/Tools-Resources/ESR-Top-Ten-Background-Check-Trends/.

ESR Webinar on Top Ten Background Check Trends for 2018

Employment Screening Resources (ESR) founder and CEO Attorney Lester Rosen will host a live webinar entitled “ESR Top Ten Background Check Trends for 2018” that will take place on Wednesday, January 17, 2018, from 11:00 AM to 12:00 PM Noon Pacific Time. To register for the complimentary webinar from ESR, which will acquaint employers and Human Resources (HR) professionals with emerging and influential trends in the background screening industry, please visit https://attendee.gotowebinar.com/register/6841084769383752449.

NOTE: Employment Screening Resources® (ESR) does not provide or offer legal services or legal advice of any kind or nature. Any information on this website is for educational purposes only.

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