Salary History Bans – Know the Limitations
March 6, 2021
ASE has received many questions regarding the salary history ban many states have enacted recently. A salary history ban prohibits employers from asking applicants about their current or past salaries, benefits, or other compensation.
Michigan prohibits salary history bans. Employers in Michigan are still permitted to ask candidates previous and current salary, benefits, and other compensation. However, State of Michigan offices cannot ask an applicant about their salary history until a conditional employment offer is made. They also cannot ask current or prior employers or search public records to get that information. If salary is already known, it cannot be used to make a hiring decision.
On March 26, 2018, Michigan signed a bill that prohibits local governments from regulating the information employers can request from prospective employees during the interview process. Public Act 84 provides that “[a] local governmental body shall not adopt, enforce, or administer an ordinance, local policy, or local resolution regulating information an employer or potential employer must request, require, or exclude on an application for employment or during the interview process from an employee or a potential employee.” The law went into effect in June 2018 and remains in effect today.
Why are some states enacting laws that ban the salary history question? These laws are aimed at ending the cycle of pay discrimination, and some go further than just banning pay history questions. A few also prohibit an employer from relying on an applicant’s pay history to set compensation if discovered or volunteered, while others prohibit an employer from taking disciplinary action against employees who discuss pay with coworkers.
Historically, requesting job applicants’ salary histories has been common practice for employers. Recruiters and hiring managers often use this information to exclude people from the candidate pool, either because the applicant is “too expensive” or their previous salary is so low, hiring managers think the person is poorly qualified or inexperienced.
While knowing the candidate’s salary history can be helpful during the recruiting process, there are other factors employers should use to determine if the candidate is a fit for their position. First, employers must have a job description created that includes the required skills and experience needed to perform the job successfully. Second, employers must have a compensation structure created that the job descriptions are aligned to. With these two items in place, employers can be assured they are offering candidates a salary that fits within the industry standards based on the skills and experience the candidate brings to the company.
A good practice to enact, is to have your salary range determined prior to beginning the recruiting process for a specific position. As candidates are screened, share the salary range with the candidate and ask if that fits into their requirement. This will provide the employer and candidate with the salary information for each to determine if they want to continue with the recruiting process.
To help multi-state employers, we have provided a list of states that have enacted salary history bans. Keep in mind, these salary bans vary in form. Visit www.paycor.com for more detail on the bans for each state.
|Alabama||All||Employers can’t decline hiring, interviewing, promoting, or employing an applicant if they refuse to provide their pay history.|
|California||All||Employers can’t ask for an applicant’s pay history. If they already have the information or the applicant volunteers it, that information can’t be used to determine pay. Employers are also required to provide pay scale information if an applicant asks.|
|California||San Francisco||All (incl. contractors and subcontractors)||Employers can’t ask for or use an applicant’s compensation when setting pay. Employers also can’t disclose a current or former employee’s salary without their consent.|
|Colorado||All||Employers can’t ask for an applicant’s pay history. They also can’t use pay history to set salaries. They can’t discriminate or retaliate against a candidate who doesn’t disclose their pay history.|
|Connecticut||All||Employers can’t ask for an applicant’s pay history, unless the applicant voluntarily disclosed the information.|
|Delaware||All||Employers can’t screen applicants based on past salary and they can’t ask about salary history. They can verify salary after extending an offer.|
|District of Columbia||Government agencies||Government agencies can’t ask applicants for their salary history unless it’s brought up by the candidate after an employment offer is extended.|
|Georgia||Atlanta||City agencies||The city can no longer ask for pay history on its applications, in interviews or employment screenings.|
|Hawaii||All (incl. employment agencies)||Employers can’t ask about salary history. They also can’t use that information unless the applicant volunteers it. The law doesn’t apply to internal applicants.|
|Illinois||State agencies||The state can’t ask applicants about salary history.|
|Illinois||All||Employers can’t ask about salary history including benefits or other compensation but they can discuss the applicant’s pay expectations.|
|Illinois||Chicago||City departments||City departments can’t ask for salary history.|
|Kentucky||Louisville||Louisville/Jefferson County Metro Government offices and agencies||City offices can’t ask for an applicant’s salary history.|
|Louisiana||New Orleans||City departments||City offices can’t ask for an applicant’s salary history. Applicants can provide pay history to negotiate a higher salary after an offer is made.|
|Maine||All||Employers can’t ask for an applicant’s pay history until a job has been offered.|
|Maryland||All||Employers can provide an applicant with a wage range for the position and can confirm voluntarily provided salary history once an offer of employment is made. Employers cannot retaliate against an applicant that does not voluntarily provide salary history.|
|Maryland||Montgomery County||The county can’t use salary history to decide whether to hire an applicant. They also can’t retaliate against or decline to hire a person who refuses to share their salary history. The county can use salary history to offer a higher salary than initially offered as long as this doesn’t result in unequal pay for equal work and the information was voluntarily disclosed.|
|Massachusetts||All||Employers can’t ask for salary history. They can confirm history if the applicant volunteers or if they’ve extended an offer.|
|Michigan||Private employers||Salary history bans are prohibited.|
|Michigan||State departments||State offices can’t ask an applicant about their salary history until a conditional employment offer is made. They also can’t ask current or prior employers or search public records to get that information. If salary is already known, it can’t be used to make a hiring decision.|
|Mississippi||Jackson||City offices||City offices can’t ask for salary history.|
|Missouri||All||Employers can’t ask for or use salary history when offering employment or determining salary, benefits or other compensation. They can discuss the applicant’s pay expectations. Prohibitions don’t apply to information disclosed by the applicant.|
|Missouri||Kansas City||City offices||City offices can’t ask for pay history until the person has been hired.|
|New Jersey||All||Employers may not screen applicants based on salary history nor require specific salary history to satisfy a minimum or maximum criteria. Employers may confirm pay history after an offer of employment.|
|New York||All state agencies and departments (except Port Authority)||State offices can’t request salary history until after an employment offer is made. If previous compensation is already known, it can’t be used to determine an applicant’s salary.|
|New York||Private employers||Employers can’t ask for salary history. An employer can confirm salary if the applicant gives a pay history to support a higher salary when a job is offered.|
|New York||New York City||All||Employers can’t ask about previous pay or benefits. If they already have that information, they’re can’t use it to set pay.|
|New York||Albany County||All||Employers can’t request past compensation information until after a job offer is made.|
|New York||Suffolk County||All||Employers can’t request past compensation information. They can’t search public records or use known salary information to set pay.|
|New York||Westchester County||All||Employers can’t request past compensation information. They can confirm past pay and use that information in setting pay in certain circumstances.|
|North Carolina||State agencies||State agencies can’t request salary history and can’t use previously obtained salary information to set pay.|
State and local governments are excluded, with the exception of Cincinnati
|Employers can’t ask for salary history or use known salaries. They’re also required to provide a pay scale for a position if the applicant has received an employment offer.|
|Ohio||Toledo||Employers with 15 or more employees located in the city||Employers can’t ask for pay history. They also can’t require an applicant’s compensation to satisfy minimum or maximum criteria. They can discuss an applicants’ pay expectations.|
|Oregon||All||Employers can’t ask about pay history until an employment offer has been made. They’re also prohibited from using previous salary information to set pay, except for existing employees moving to a new role.|
|Pennsylvania||State agencies||State agencies can’t ask about current compensation or compensation history. Additionally all job postings have to clearly disclose a position’s pay scale and range.|
|Pennsylvania||Pittsburgh||City offices and agencies||City employers can’t ask about prior pay. If they discover the information, they’re prohibited from using it unless the applicant has volunteered it.|
|Pennsylvania||Philadelphia||City offices and agencies||City employers cannot inquire about an applicant’s wage history or retaliate against an applicant for failing to provide wage history. City employers also cannot rely on wage history in determining wages for an employee unless applicant willingly disclosed wage history.|
|Puerto Rico||All||Employers can’t request pay histories, but voluntary salary disclosures made after a job offer has been extended are allowed.|
|South Carolina||Columbia||City agencies||The city can’t use pay history unless the applicant voluntarily provides the information.|
|South Carolina||Richland County||County offices||Richland County has deleted the salary history question from its applications, interviews and employment screenings.|
|Utah||Salt Lake City||City offices||City offices can’t ask an applicant about their salary history. If the applicant voluntarily provides the information, it can’t be used to determine current salary.|
|Vermont||All||Employers can’t request pay histories. If the information is volunteered, they can only confirm after making a job offer.|
|Virginia||All||Salary history has been removed from state applications.|
|Washington||State agencies||Employers can’t ask for pay history. They can confirm voluntarily disclosed information before or after an offer has been extended.
Businesses with 15 or more employees must provide the minimum salary for the position upon applicant request and after an offer has been extended.
|Wisconsin||All||Wisconsin has banned salary history bans.|