Refusing to Provide Salary History Information During Job Interviews
By Ken Levine, Esq., Bailey Duquette P.C., New York, New York
Potential employers routinely ask for an applicant’s current salary before making an offer. The practice arguably perpetuates gender pay disparity, since an unfairly low salary at one company will then have an “anchoring effect” and lead to a lower salary at the next job, continuing the systemic bias. Many women who also take time off from work to care for children re-enter the workforce at a lower salary, and similarly run the risk of being stuck at a lower salary rung at subsequent jobs.
Employers are already prohibited by federal and state laws from compensating men and women at different rates for the same work, and women can sue if they experience wage disparity in violation of those laws. But reliance on salary history may still perpetuate the gender disparity, even if not done for overtly sexist reasons.
In an effort to ensure pay equity for women, Massachusetts, Philadelphia and New York City have all recently passed laws to restrict salary history questions, and other states, including Illinois, New Jersey, Maine, California, and Vermont, are considering similar measures. The New York City law prohibits employers or their agents from inquiring about the salary history of an applicant, whether male or female, and restricts an employer’s ability to rely upon salary history in determining compensation during the hiring process, even if the employer finds the information through lawful publicly-available sources. The New York City law allows an employer to discuss with an applicant his or her expected salary, salary range and benefits. A prospective employer is also allowed to consider salary history if the applicant “voluntarily and without prompting” discloses the information. The law does not apply to internal promotions.
No state or city laws are currently in effect. Philadelphia‘s ordinance was scheduled to take effect on May 23, 2017, but a federal court stayed its effectiveness pending a legal challenge on first amendment grounds. The New York City legislation will take effect on October 31, 2017, and the Massachusetts law, passed last summer, will take effect on July 1, 2018, unless either of them faces similar legal challenges. Several government agencies also prohibit inquiry into salary history for the same reasons.
The new laws can serve to embolden women to withhold their current salary information during contract negotiations. Women (and men) can credibly argue that not relying on salary history requires employers to make clear, market-based decisions about pay. Some head hunters in fact actively advise all clients not to reveal current salary for this very reason, even when pressured to do so. The issue is especially relevant for women who have taken time off from work to care for children. Citing to these new laws and policies, even if not currently legally binding on prospective employers, can serve as sound justification for withholding salary history information during employment negotiations.
Ken Levine is a commercial litigator and general corporate adviser.
