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In an effort to continue working toward closing the gender wage gap, more states are enacting laws that prevent an employer from asking a candidate or applicant for compensation history.
As of August 2020, there are 19 states that have banned the requests of salary history and compensation. They can however, consider a candidate’s salary history should the applicant share that information voluntarily. It will still be legal for employers to share the salary range of the positions they are hiring for, and to ask a candidate what their desired salary range is.
These laws also protects companies from being held responsible if a representative, such as a third-party recruiter, should unlawfully request salary information from an applicant or candidate. Additionally, employers will still be allowed to request salary history from an applicant after an offer has already been extended and accepted, but only to confirm their history.
The rationale behind such laws is that when no salary history is disclosed, employers are forced to make offers based upon the work being done, and the work experience of the candidate. Therefore, making it less likely that currently underpaid applicants will not have their salary history used against them and continue to be underpaid.
With the laws aiming to end the cycle of pay discrimination, there are some blurred lines across different states as to how far they will go to protect the applicants seeking a new job. A few states also prohibit an employer from relying on an applicants pay history to set compensation if discovered or volunteered. Some meanwhile prohibit an employer from using any sort of action against employees who discuss pay amongst coworkers.
The most recent states to enact these laws are Colorado and Maryland, making them effective state-wide within the last six months.
If you are an employer in any of these areas, be sure to review your current hiring practices with an employment attorney, and update them to be compliant with these changes. Also, check on any laws or pending legislation that may soon be enacting similar changes in the states where you are hiring.
For information about how you can use pre-screening questions to streamline recruiting, please contact the team at The Applicant Manager.