Starting on January 1, 2018 employers with operations in California will no longer be able to seek or rely on salary information. Governor Brown recently signed Assembly Bill 168, which adds Section 432.3 to the California Labor Code.
Section 432.3 prohibits salary inquiries from employers and their agents. The law also requires employers to provide job applicants, upon reasonable request, with a pay scale for the positions they seek. The law allows employers to rely on salary data, provided that the candidate volunteered it; however, employers should exercise caution before relying on this history.
This law is not unique to California; Delaware, Massachusetts, New York, and Oregon all have similar laws, as do Puerto Rico and the cities of New York, Philadelphia and San Francisco. The intention of these prohibitions on salary inquiries is to eliminate inequality in pay. Salary histories are sometimes a factor in setting a new hire’s salary. This may perpetuate prior pay discrimination by a prior employer. Employers with locations in these areas should review their application materials and update them to avoid liability.
Practice AreasLabor, Employment, Employee Benefits and ERISA