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By: Jennifer L. Sommer
AB 168, likely to pass into California law in 2017, would ban California employers from asking job applicants about their salary history. The bill would apply to all employers, including state and local governments. However, only private employers would have to provide applicants with the relevant position’s pay upon reasonable request.
Proponents say the law is intended to prevent the perpetuation of historical patterns of gender bias and discrimination, where low starting salaries tend to follow the female worker throughout her lifetime. Additionally, proponents say the pay gap follows women even after they leave the workforce, where one observes the impact in lower retirement benefits as well as lower benefits for other programs based on earnings.
The bill’s supporters cite to numerous studies finding disparities in earnings between men and women in the workplace over the last fifty years. In 1963, women who worked full-time year-round made an average of 59 cents for every dollar earned by a man, according to the American Association of University Women (AAUW). Today, women working full-time in the United States typically are paid 80 percent of what men are paid, a gap of 20 percent. (The Simple Truth about the Gender Pay Gap, 2017 Edition, AAUW). The wage gap is even larger for women of color. According to the National Partnership for Women & Families, among women who hold full-time, year-round jobs in the United States, African American women are typically paid 63 cents for every dollar paid to white men, while Latinas are paid 54 cents for every dollar. Asian women are paid 85 cents for every dollar paid to white men, however, some ethnic subgroups of Asian women are paid far less. (America’s Women and the Wage Gap, National Partnership for Women & Families, April 2017)
According to proponents, closing the gender wage gap starts with barring employers from asking questions about salary history so that previous salary discrimination is not perpetuated.
Similar laws in other jurisdictions
In 2016, Massachusetts and Philadelphia enacted laws prohibiting employers from asking job applicants about their salary history. In 2017, New York City and Puerto Rico passed similar laws. In California, San Francisco is currently considering Ordinance No. 170350 which would ban employers from considering the current or past salary of an applicant in determining what salary to offer and from asking applicants about their current or past salary.
Opponents of AB 168 include the California Chamber of Commerce and trade groups, who say the law is unnecessary in view of existing law, which already bans California employers from gag orders preventing the employee from disclosing his or her wages (Cal. Labor Code §232), or for paying rates less than the rates paid to employees of the opposite sex for substantially similar work (Cal. Labor Code §1197.5(a)
Further, AB 1676 was enacted in 2016, providing that prior salary cannot, by itself, justify any disparity in compensation under the bona fide factor exception in the existing Equal Pay Act law. Existing California law, however, does not prohibit employers from inquiring about prior salary information.
The specific provisions, if passed, would:
1) Prohibit a California employer, orally or in writing, personally or through an agent, from seeking salary history information, including compensation and benefits, about an applicant for employment.
2) Require a California employer, upon reasonable request, to provide the pay scale for a position to an applicant applying for employment.
3) Apply to all California employers, including the state and local government employers and the Legislature.
4) Not apply to salary history information that is disclosable to the public pursuant to specified federal and state law.
For additional information related to this topic or other business matters you may contact Jennifer L. Sommer from the law firm of Freeman, Mathis & Gary, LLP at [email protected].