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New York City Council Passes Law Prohibiting Employers from Inquiring into Salary History of Job Applicants
On April 5, 2017, the New York City Council passed legislation which will amend the New York City Human Rights Law (“NYCHRL”) making it an unlawful discriminatory practice for an employer, employment agency, or an employee or agent thereof to inquire into, or to rely upon, an applicant’s salary history.1 The legislation will take effect 180 days after it is signed into law by Mayor de Blasio. The Mayor recently issued an executive order similar to this legislation banning New York City agencies from inquiring into applicants’ salary history and so he is fully expected to sign this legislation into law.
“To inquire” into an applicant’s compensation history means “to communicate any question or statement to an applicant, an applicant’s current or prior employer, or a current or former employee or agent of the applicant’s current or prior employer, in writing or otherwise, for the purpose of obtaining an applicant’s salary history, or to conduct a search of publicly available records or reports for the purpose of obtaining an applicant’s salary history” but does not include informing the applicant about the position’s proposed or anticipated salary or salary range.
“Salary history” includes an applicant’s “current or prior wage, benefits or other compensation,” but does not include any “objective measure of the applicant’s productivity, such as revenue, sales or other production reports.”
Where a prospective employee voluntarily and without prompting discloses his or her salary history, then an employer may consider and verify that salary information. In addition, employers may, without inquiring about salary history, engage in discussion with an applicant about his or her expectations with respect to salary.
The legislation applies to all New York City public and private employers, including temporary staffing agencies and recruitment firms. According to the City Council, when employers rely on salary histories to determine compensation, they perpetuate the gender wage gap. By adopting this legislation, the Council intends to reduce the likelihood that women will be prejudiced by prior salary levels and help break the cycle of gender pay inequity.
The New York City Commission on Human Rights will be enforcing the new law. Civil penalties include up to $125 for an unintentional violation and up to $250,000 for an “intentional malicious violation.”
New York City employers should take immediate steps to review their policies and practices to ensure compliance with the new legislation. Human Resources personnel, and anyone involved in interviewing candidates, should be notified of this new prohibition. Additionally, employers should ensure their job applications do not include requests for applicants to disclose their salary history. Employers should also implement a process to document any instances where an applicant voluntarily discloses salary history.
If you have any questions, please do not hesitate to contact David R. Rothfeld, Lois M. Traub, Alexander Soric, Robert L. Sacks, Michael Lydakis, Jennifer Schmalz or Jaclyn Ruocco.
1. The new law does not apply to applicants for internal transfer or promotion with their current employer. |
