If you are an HR manager or responsible for hiring in your organization, you should know what a salary history ban is and how it can impact your hiring process. Local and state governments are increasingly adopting laws that prohibit employers from asking candidates their pay history. Twenty-one states in the US, including Illinois, have already implemented the salary history ban.
The salary history ban is a move to fight gender discrimination and bridge the pay gap between men and women. According to a report by the Harvard Business Review, CEOs can take a single step to reduce pay disparities for women employees: Stop asking them about their pay.
What is the Salary History Ban?
The salary history ban came into existence as salaries are negotiable, and not fixed on the basis of experience and title. They do not follow set guidelines. This adds a conflictual element to the complete hiring process. Moreover, job seekers want to secure the highest pay possible for a position, but the employers cannot pay more than they have budgeted for the open position. However, if salaries were standardized or a concept of “equal pay for all” existed, salary disparity issues would not have existed.
Historically, women have always been underpaid in comparison to their male counterparts. According to a report by the Bureau of Labor Statistics, women earned 82% of what their male counterparts earned in 2016. Also, some job seekers remain underpaid and are not able to secure higher pay packages because of their historically low salaries.
What Does the Salary History Ban Prohibit?
The salary history ban prevents employees from asking candidates about their past salaries and benefits. Employers are also prohibited from hiring agencies to inquire about a candidate’s pay history. As an employer, you cannot request information about a candidate’s current salary or salary history from either the candidate’s current or former employer or an agent of the candidate’s current or former employer.
The ban also prohibits employers from searching publicly available records or reports for collecting information about a candidate’s current or past salary data.What Are Employers Permitted to Ask?
In states that have implemented the salary history ban, employers can ask candidates about their salary expectations. Therefore, employers can still identify and eliminate candidates with unrealistic salary expectations. Also, if a candidate is willing to share their salary history, employers can consider the information and use it to determine the new salary for the candidate.
Where the Salary History Ban is in Place
In Illinois, neither state agencies nor employers are allowed to ask candidates for their salary history. What follows is a list of other states who also have a salary history ban in place. If you have sister companies or locations outside of Illinois this list may be helpful.
Alabama: An employer cannot refuse to interview or hire a candidate who does not want to provide their salary history.
California: Both private and public employers cannot ask for a candidate’s salary history. Even if an employer already has the salary history, they cannot use the same for the hiring process.
Colorado: All employers, including various states and political subdivisions, departments, commissions, and school districts, cannot ask for a candidate’s salary history.
Connecticut: All employers, including individuals, corporations, firms, partnerships, limited liability companies, joint-stock associations, voluntary associations, and state and political subdivisions, cannot ask for a candidate’s salary history.
Delaware: While employers are not allowed to ask candidates their salary history, they can do so after extending an offer letter.
District of Columbia: District government agencies are not allowed to ask candidates their salary history until they extend an offer to the candidate.
Georgia: Employers in Atlanta cannot ask for salary history in job applications, interviews and screening rounds.
Hawaii: All employers and employment agencies are not allowed to ask candidates for their salary history. However, the ban is not applicable to candidates within the organization (internal job postings).
Kentucky: City agencies are not allowed to ask candidates for their salary history. The ban is also applicable to the Jefferson/Louisville County Metro Government.
Louisiana: City agencies are not allowed to ask candidates for their salary history.
Maine: Employers can only ask for a candidate’s salary history after the final salary negotiation.
Maryland: Employers are not allowed to ask candidates for their salary history during the interview or screening rounds. However, they can do so after extending an initial employment offer. If requested, employers should also provide the candidates with the salary range for the position they are applying for.
Massachusetts: All employers, including municipal and state employers, cannot request salary history information from candidates during the interview or screening rounds. However, they can do so after extending an initial employment offer.
Michigan: All employers in the state are prohibited to request salary history information.
Mississippi: All employers in the city are prohibited to request salary history information.
Missouri: All employees hiring six or more employees come under the salary history ban. While they ask the candidates about their salary expectations, they cannot request salary history information.
New Jersey: All agencies and offices in New Jersey are not allowed to ask candidates for their compensation history.
New York: All employers, agencies, and departments except for the Port Authority of New Jersey and New York cannot request salary history information from job candidates.
North Carolina: State agencies are not allowed to request salary history information from candidates applying for a job.
Ohio: Employers with 15 or more employees in Cincinnati, excluding local and state governments, are not allowed to ask candidates for their salary history. If requested, employers should also provide the candidates with the salary range for the position they are applying for. All employers with 15 or more employees in Toledo, are not allowed to ask candidates for their salary history. However, they can ask candidates for their salary expectations.
