LEGISLATION UPDATE: State Legislatures Begin to Focus on Salary History

New Massachusetts law goes into effect July 1, 2018

By NAPBS Partner Akin Gump Strauss Hauer & Feld and NAPBS’ Government Relations Committee

Recently, several state legislatures have introduced bills that seek to prohibit employers from seeking or inquiring about an applicant’s past salary history. The intent of these bills is to prevent wage discrimination between workers who perform equal job functions, namely workers of opposite sexes.

Under many current state laws, employers may justify a difference in wages for equal positions based on several factors, such as merit-based pay systems or commission- or production-based wage systems. By prohibiting prospective employers from inquiring about an applicant’s previous salary history, the bills seek to clarify that an applicant’s prior salary may not be used as justification for paying the applicant a lower wage for doing comparable work.

Two of these salary history bills were introduced this year in California and Massachusetts. Massachusetts Senate Bill 2119, which was enacted on August 1, 2016, makes it unlawful to “screen job applicants based on their wage, including benefits or other compensation or salary histories… or request or require as a condition of being interviewed, or as a condition of continuing to be considered for an offer of employment, that an applicant disclose prior wages or salary history.” While the California bill (Assembly bill 1676) was amended to remove the prohibition against seeking salary history information, it includes language that clarifies that prior salary “shall not, by itself, justify any disparity in compensation.” The Massachusetts bill will become effective on July 1, 2018.

Background screeners should be aware of these attempts to alter what information employers may or may not seek from applicants, as it may impact their screening services and the information they gather on behalf of their clients. If you have any questions about these types of bills, please contact NAPBS’s government relations committee co-chairs, Kelly Uebel or Jay Harris. Consultation with legal counsel is also recommended in all matters.