New Jersey Bans Salary History Inquiries by Employers to Promote Equal Pay

Men Woman Question Marks Equal Pay

Written By ESR News Blog Editor Thomas Ahearn

On July 25, 2019, Acting New Jersey Governor Sheila Y. Oliver signed Assembly No. 1094 into law to prevent employers from asking about wage and salary history of workers to combat this discriminatory practice and promote equal pay and gender equity, according to a press release on the NJ.gov website.

In January 2018 – in his first official act after being sworn into office – New Jersey Governor Tom Murphy signed an executive order combating gender inequality and promoting equal pay for women in New Jersey by banning the discriminatory practice of salary history inquiries in state government.

“Since day one, the Murphy Administration has been committed to closing the gender wage gap. Governor Murphy’s first executive order promoted equal pay across state government and prohibited prospective employees from being asked their salary histories,” Acting Governor Oliver stated.

A1094 makes it an unlawful for New Jersey employers to screen job applicants based on salary history, prior wages, commission, benefits, or any other current or previous compensation to ensure that employees in the state receive salaries commensurate with their skills, qualifications, and experience.

Studies show that women who hold full-time, year-round jobs in New Jersey are paid 82 cents for every dollar paid to men holding full-time, year-round jobs and that this gender wage gap is demonstrated across all industries and education level of workers, according to the press release.

Studies have shown that women who hold full-time, year-round jobs in New Jersey are paid 82 cents for every dollar paid to men holding full-time, year-round jobs, and that the wage gap between Latina women and White men in New Jersey is the largest in the nation, according to the press release.

Previously, employers in New Jersey were permitted to ask applicants about their salary histories perpetuating the wage gap. According to research from the National Partnership for Women and Families, wage inequality leads to a combined loss of $32.5 billion in New Jersey every year.

Under A1094, any employer who attempts to ask or obtain applicants salary history will be subject to a civil penalty of no more than $1,000 for a first offense, $5,000 for a second violation and $10,000 for any subsequent violations. The complete text of A1094 is available here.

States that have passed salary history laws include California, Connecticut, Delaware, Hawaii, Illinois, Maine, Massachusetts, Michigan (which prohibits salary history bans in the state), New Jersey, New York, Oregon, Pennsylvania, Vermont, and Wisconsin (where local governments may not ban salary history).

Laws banning salary history questions by employers will increase as the pay equity movement to narrow the gender wage gap grows and his trend was chosen by global background check provider Employment Screening Resources® (ESR) as one of the “ESR Top Ten Background Check Trends” for 2019.

“If new pay is based on previous pay, then gender pay gaps are perpetuated. The goal of equal pay laws is to base compensation on the work performed and not rely on previous pay that may reflect gender discrimination,” explained ESR founder and Chief Executive Officer (CEO) Attorney Lester Rosen.

“When an employer has a background screening firm perform past employment verifications, it is critical that firm knows which cities, counties, and states prohibit such questions, as well as software that facilitates compliance with equal pay laws, or else that employer could be fined,” Rosen said.

Employment Screening Resources® (ESR) offers employers flexible and customizable employment verifications that provide the salary history of applicants only if permitted by state and local equal pay laws. To learn more, visit www.esrcheck.com/Background-Checks/Verifications-References/.

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.

© 2019 Employment Screening Resources® (ESR) – Making copies or using of any part of the ESR News Blog or ESR website for any purpose other than your own personal use is prohibited unless written authorization is first obtained from ESR.