California employers are now prohibited from asking applicants about their salary history information, including compensation and benefits. Under the new law Gov. Jerry Brown signed on Thursday, October 12, 2017, called Assembly Bill No. 168, such inquiries are no longer allowed. The bill passed the state Assembly with a 57-15 vote and the Senate with a 27-10 vote. The new law applies to all employers, including state and local government employers. Proponents of salary history bans argue that using workers' prior history to set their new salary perpetuates lower pay for women and minorities. Opponents argue that such inquiry bans make it harder for employers to gauge the market price for workers.
Specifically, the law prohibits an employer from relying on the salary history information of an applicant to determine whether to offer them employment or what salary to offer them. The law prohibits an employer from seeking salary history information directly and indirectly through intermediaries. The law also requires, upon reasonable request, that employers provide the pay scale for a position to an applicant for employment. The law does not prohibit an applicant from voluntarily and without prompting disclosing salary history information, and does not prohibit an employer from considering or relying on that voluntarily-disclosed salary history information.
To comply with the new law's requirements, employers should remove salary questions from any hiring forms (such as job applications, on-line applications, candidate questionnaires and background check forms), update interview and negotiation policies and procedures, and train hiring managers, recruiters and interviewers on the new provisions. Interviewers need to be particularly aware that this law applies to all conversations with applicants. Employers can discuss an applicant's salary expectations, but interviewers need to be mindful of the law's restrictions. If a hiring manager asks about salary expectations in a way that is intended to solicit salary history information or pressures an applicant to disclose such information, that could lead to allegations of a violation of the law's requirements.
California isn't the first government entity to implement a salary history ban. San Francisco banned salary history questions earlier this year, while New York City, Philadelphia, Delaware, Puerto Rico, Oregon and Massachusetts have adopted similar laws.