As noted in our previous Legal Alert, New York’s new “salary history ban” law took effect on January 6, 2020. New York State has now issued guidance on the law that clarifies certain aspects of the salary history ban.

In general, the new law prohibits employers from inquiring about a job applicant’s salary or wage history in connection with a job application, interview, or promotion. The law also prohibits employers from relying on salary or wage history as a factor in their current employees’ applications for promotion or other positions, or in determining whether to offer employment to job applicants, or in determining what salary or wage to offer a job applicant.

Summary of State’s Guidance on Salary History Ban

The State’s guidance offers clarification on the law that employers and Human Resources professionals should be familiar with as they begin recruiting and hiring in 2020. Per the guidance:

• Employers are prohibited from asking about any information concerning an applicant’s salary history information, including any information related to the applicant’s previous “compensation and benefits.”
• Employers may ask applicants for their salary expectations “instead of asking what the applicant earned in the past.”
• While the law does apply to “current employees,” employers may still consider information about their current employees that is already in their possession, such as the employee’s current salary and benefits received. Employers may not, however, ask their current employees for salary or wage history information from other jobs.
• Applicants may voluntarily disclose salary history information. Employers cannot, however, pose any sort of “optional” salary history questions, such as asking an applicant to provide their salary history only if they “feel comfortable” doing so.
• Employers may not seek to obtain salary history information from an alternative source, such as from the applicant’s former employer. However, employers may confirm wage or salary history from such a source if an applicant voluntarily discloses his/her salary history information.
• Employers are not required to post or set a pay scale for an open position.
• Independent contractors, freelance workers or other contract workers are not covered by the law unless they are working through an employment agency.
• The law applies to any position primarily based in New York State, even if the employer is not based in New York State.

Special Considerations for Employers in New York City

The law covers employers in New York City, requiring employers in NYC to follow the new law in conjunction with the salary history protections already provided to employees under the New York City Human Rights Law. Although the City law is similar to the State’s law in many respects, there are variations that employers in the City should note. The City law applies only to job applicants, and not to current employees. City law also allows employers to inquire about deferred compensation or unvested equity that an applicant would have to forego upon accepting a new position. For more information on the City’s salary history protections, employers should review the New York City Commission on Human Rights’ website.

Takeaways and Next Steps for Employers

Employers should review and analyze their recruiting and hiring practices to ensure compliance with the new law. Human resources personnel, recruiters and employees that will be involved in interviewing or hiring applicants should also be trained to avoid inadvertent violations of the new law. Employers may wish to consider standard procedures to record if and when an applicant voluntarily discloses their wage or salary history.

Employers should also review their job applications and related documentation to ensure they do not contain questions relating to wage or salary history. As recommended by the guidance, employers should consider proactively stating directly on their job postings that they do not seek salary or wage history information from job applicants.