New York State Employment Law Update: Salary History Ban

As of January 6, 2020, all New York State employers and human resources professionals are banned from asking about a job applicant’s salary history. This new law prohibits employers from factoring an applicant’s prior earnings in their decision to hire or determine their salary offer.

NYS has recently issued a guide for employers which breaks down important aspects of the “salary history ban.”

WHEN RECRUITING AND HIRING, IT IS CRUCIAL TO KEEP THE FOLLOWING IN MIND:

• Employers cannot ask about any information regarding an applicant’s salary history information or their previous “compensation and benefits.” However, employers can ask applicants for their salary expectations.

• While applicants can voluntarily share their salary history, employers cannot ask any “optional” questions about salary history.

• Employers can seek to confirm salary history information with an outside source such as a prior employer, only if the applicant voluntarily discloses that information.

• The law does cover “current employees,” in that the employer may not ask for salary history. However, they may consider the employee’s current salary at the company.

• Employers are not obligated to set a salary scale for any open position.

• Those not covered by the new law include: Independent contractors, freelance workers and/or other contract workers.

• This law covers any applicant seeking a position primarily based in NYS, even if that employer is based elsewhere.

WHAT ABOUT NEW YORK CITY?

New York City employers are required to follow the new NYS salary ban in addition to protections already in place under the NYC Human Rights Law. While the state laws and city laws are fairly similar, there are a few key differences to note:

• The New York City employment laws regarding salary history apply only to job applicants, not current employees.
• Employers are allowed to ask about deferred compensation or unvested equity that an applicant may have to go through when transitioning into the new role.

KEY TAKEAWAY:

All New York based employers should take time to review their hiring processes, re-train their HR staff, and revise their job postings in order to fully comply with the new law.

Feel free to contact us if you have any questions.