By Erica Parks
In August 2016, we alerted you that the New York City Council was considering an initiative that would prohibit employers from seeking an applicant’s salary history, and from using salary history to determine pay under most circumstances. Recently, the Council approved the legislation, which was signed into law by Mayor de Blasio last week.
The new law, which can be read in full here, amends the New York City Human Rights Law by making it an “unlawful discriminatory practice” to inquire about or seek an applicant’s salary history, including by searching publicly available records. Employers also will be prohibited from using salary history to determine pay “at any stage in the employment process” unless the applicant “unprompted, willingly disclosed such salary history” or disclosure is otherwise authorized under federal, state, or local law. Salary history is broadly defined and includes current and prior wages, benefits, and “other compensation.” The new law does not, however, prohibit employers from discussing with applicants their expectations with respect to salary, benefits, and other compensation, including equity, nor does it prohibit employers from asking about “objective measures” of their performance history, such as “revenue, sales, or other production reports.”
Employers who violate the new law can face civil penalties of up to $250,500, back pay, compensatory damages, and attorneys’ fees.
As we previously alerted you last August and October, similar legislation has been passed in several other states, including California and Massachusetts, which may indicate a growing trend towards restricting employers from seeking or relying on an applicant’s wage history.
Q: What Does This Mean For New York and Multi-State Employers?
A: Employers in the City of New York must take steps to ensure that their hiring practices conform to the new law. Moreover, multi-state employers should review any centralized recruiting systems or multi-state employment applications and hiring materials for any request for salary history and consider revising to exclude New York City-based positions and, given the growing trend of prohibiting salary history inquiries, even omitting such requests nation-wide.