As reported by HRLegalist earlier this year, Philadelphia’s City Council unanimously approved a pay equity bill making Philadelphia the first city in the nation to adopt comprehensive “wage-gap” legislation. Under the Wage Equity Law, Philadelphia employers and employment agencies are prohibited from making any inquiry into a job applicant’s wage history during any stage of the employment process. The Wage Equity Law seeks to ferret out discrimination and address historic pay disparities among men, women and minorities.
Just last month, New York City’s Mayor de Blasio signed a similar law barring private employers from asking about a job applicant’s salary history until after an offer is made. This law is in addition to the ban adopted by New York State and New York City prohibiting public agencies from making salary history inquiries prior to an offer of employment.
Other cities and states are attempting to follow suit. The Massachusetts salary history ban, which became law in 2016, will take effect July 2018. Similar to the ban in New York City, Massachusetts prohibits private employers from asking applicants to disclose pay history until after the employer makes an offer. New Orleans and Pittsburgh have passed legislation prohibiting public agencies from asking about salary history.
Other states have had less success in enacting similar laws. New Jersey attempted to pass salary history prohibitions but the legislation was vetoed by Gov. Chris Christie as being “very business unfriendly.” Salary history legislation in California was also vetoed by Gov. Jerry Brown.
In addition to the challenges in the legislature, salary history bans will likely face challenges in court. In fact, the Chamber of Commerce of Greater Philadelphia has challenged the Wage Equity Law, arguing that it deprives businesses of their First Amendment rights. In a federal lawsuit filed in April 2017, the Chamber asserted that the City did not show evidence that an applicant’s wage history had any relationship to the persistence of gender-based wage discrimination.
Despite current opposition to the salary history ban, employers can expect to see more of these laws across the country, especially in places that have already adopted similar provisions for public employees. Employers, recruiters and employment agencies should take note of this new law, and take steps to ensure compliance. For example, prior salary inquiries on job applications should be removed and personnel involved in recruiting or hiring should be trained on the new prohibitions regarding salary histories.
Employers should consult with legal counsel to stay on top of Pay Equity laws in their respective jurisdictions. Meanwhile, HR Legalist will continue to report on this developing area of employment law.
Larae N. Cunningham is an attorney in Obermayer’s Labor Relations and Employment Law Department. Her practice focuses on counseling management in all aspects of labor relations and employment law including discipline, termination, reductions-in-force, document retention, family and medical leave, reasonable accommodation under the ADA, NLRB compliance and wage and hour issues. She can be reached at 215-665-3092 or firstname.lastname@example.org.