As of 6 January 2020, New York employers are prohibited from inquiring about an applicant’s prior salary. The ban (codified as N.Y. Lab. Law § 194-a) was signed into law by New York Governor Andrew Cuomo on 10 July 2019, but did not go into effect until Monday 6 January 2020. The law applies to all public and private employers within New York state and covers applicants and employees who have taken an affirmative step to seek full-time, part-time, or temporary/seasonal employment with an employer. The law does not apply to independent contractors, freelance workers, or other contract workers unless they are to work through an employment agency.
Specifically, the law prohibits all New York employers from taking the following actions with respect to any applicant or current employee:
While employers are prohibited from requesting the salary history of an applicant, an applicant may choose to voluntarily disclose his or her prior salary. If an applicant voluntarily (and without prompting) discloses his or her salary history, an employer may factor in that voluntarily disclosed information in determining the salary for that person. According to guidance issued by New York State, an employer may ask an applicant for his or her salary expectations, as opposed to his or her salary history.
The guidance also defines salary history as both compensation and benefits information and states that the prohibition applies in any instance in which the worker’s job will be based in New York state, regardless of where the interview actually takes place or where the employer is based. Individuals alleging violations of the law are able to file a civil action in court, and potential remedies may include compensatory damages, injunctive relief, and attorneys’ fees.
New York joins several other states in banning employers from inquiring about an applicant’s prior salary, including Alabama, California, Connecticut, Delaware, Hawaii, Illinois, Maine, Massachusetts, New Jersey, Oregon, Washington, and Vermont. The rationale behind these laws is to close the gender and race pay gaps that exist among employees. Statistics show that women are still earning 79 cents for every dollar earned by men who perform the same work. This number is even lower for women of different ethnicities. Many advocates believe that laws banning inquiries into prior salaries will aid in closing the wage gap by preventing the lower salaries from following workers from job to job.
Employers’ bottom Line
Employers in New York should take steps to ensure anyone with interviewing or hiring responsibilities refrain from seeking any information from an applicant about his or her prior salaries. Employers should also review job applications and other documents used in the hiring process to ensure that any questions about wage history are removed. If an employer uses third parties in the hiring process (e.g. for background checks), they should ensure they are aware of the new law and have taken steps to ensure compliance.
Additionally, all employers, regardless of whether they are in a jurisdiction that has passed a salary history ban, should consider eliminating any inquiries into an applicant’s prior salary, as these laws are becoming more widespread. For example, Colorado recently passed a similar law that is planned to go into effect on 1 January 2021, and other states are predicted to pass similar laws this year.