post

Do Not Ask About Salary History! – It’s Illegal Beginning January 1, 2018

Beginning January 1, 2018 it is unlawful for an employer to ask applicants about the applicant’s salary history.

The New Law   
Effective January 2018:
“(a) An employer shall not rely on the salary history information of an applicant for employment as a factor in determining whether to offer employment to an applicant or what salary to offer an applicant.
(b) An employer shall not, orally or in writing, personally or through an agent, seek salary history information, including compensation and benefits, about an applicant for employment.
(c) An employer, upon reasonable request, shall provide the pay scale for a position to an applicant applying for employment.”
There is an exception to the above if your business is required to ask an applicant about their salary history per a federal or state contract.

What Does The Change Mean for My Business?

You should:

  1. Review your employment application to ensure that it does not contain a request for information regarding salary history (e.g.,”prior salary” or “last rate of pay”).
  2. Make sure that managers and other staff involved in the hiring process know of the new law.

Can I Ask Anything About Salary?

Yes!  You can ask applicants about salary expectations or their desired rate of pay.

Questions? Email us at info@corehrteam.com.

 

 

post

California Fair Pay Law Expanded – Effective January 1st

Governor Jerry Brown recently expanded the California Pay Equity Act (“Fair Pay Act”) by signing new laws that will go into effect on January 1, 2017.

Specifically, the current law has been expanded to include prohibitions on pay differentials based on race or ethnicity.

Summary of the Fair Pay Act

The Fair Pay Act, signed into law in October 2015, currently prohibits employers from paying employees of the opposite sex differently where they perform substantially the same work, when viewed as a composite of skill, effort, and responsibility, and perform it under similar working conditions.

New Effective January 1, 2017

The new law, the Wage Equality Act (SB 1063), extends this prohibition to compensation disparity based on race or ethnicity. If there is a wage differential the employer must demonstrate that specific, reasonably applied factors account for the entire wage differential.

These include:

  • A seniority system;
  • A merit system;
  • A system that measures quality or quantity of production; or
  • A bona fide factor other than sex, race or ethnicity, such as education, training or experience

An employer relying on a “bona fide factor” must ensure that such factor(s):

  • Is not based on or derived from a difference in compensation that is based sex, race or ethnicity,
  • Is job related, and
  • Is consistent with a “business necessity”

The new law amends the Fair Pay Act to state that “prior salary cannot, by itself, justify any disparity in compensation.”

Practically Speaking … What does this mean?

Two things to note:

  1. Employers can no longer rely on salary history as justification for a pay deferential. Just because John has always made more than Mary isn’t justification for why John gets paid more.
  2. Employers can ask applicants for their salary history.

Considering the new amendments, California employers should carefully examine their current salary structures to ensure that disparities in the wages of employees who perform similar work are not based on sex, race or ethnicity or solely on prior salary history.

Questions?  Need help evaluating your pay structure? Call our experts at 559-825-6629.