When it comes to the application process, for many prospective employees it all comes down to pay. For years, the common practice for employers was to gauge their future employee’s salary based on their previous salary history in other jobs. However, as changes in the scope of work and length of time on the job have changed, along with advancements in equal pay laws, that method is no longer viable.
Many states and municipalities have enacted a ban on inquiring about salary history on employment applications in the last few years. States like Oregon, Massachusetts, and Delaware have already implemented the ban, and cities like San Francisco, New York City, and Philadelphia have jumped on board. Even Puerto Rico has joined the mission. Some of the laws go into effect in 2017, others in 2018 and 2019.
The penalties for violating equal pay statutes can be pricey. In New York City, violations jump from up to $125,000 for unknowingly violating the salary inquiry ban to $250,000 for knowingly continuing to do so. In San Francisco, their “Parity In Pay” ordinance grows from $100 for the first offense to $200 for the second to $500 for every offense thereafter.
Employers would be well advised to not wait for these laws to be enacted and enforced. Start reviewing job hiring processes and paperwork to see if their your company’s practices are consistent with new trends in pay equity law, including such things as not asking applicants about their previous salary. With some states and major cities along the coasts adopting this ban on salary history, the trend is set into motion. How far and fast the trend will expand remains to be seen. However, the demand from employees to be paid equally is only going to grow, continuing to put pressure on legislators at all levels to consider implementing pay equity legislation across the country.
To learn more about achieving pay equity, and to receive a free pay gap risk assessment, click here.