Seyfarth Synopsis: This week, New York state expanded a state Equal Pay Act, making it illegal to pay someone less based on characteristics including race, religion, disability or gender identity, and also other protected characteristics. New York state also passed a salary history ban. Also, just one state over, on June 20, 2019, the New Jersey Legislature passed a salary history ban and New Jersey Governor Phil Murphy is expected to sign the measure into law.
Changes to the New York State Laws
This week, New York state enacted two new pay equity laws. The first modified the state’s equal pay law and the second will ban employers from seeking salary history from applicants or current employees. Key provisions of these laws are summarized below.
Previous Modifications to the New York State Pay Equity Law
In November 2015, New York State became one of the first jurisdictions to pass a pay equity law that was more extensive than the federal equal pay laws. When this law went into effect in January 2016, New York Labor Law § 194 was amended to:
These prohibitions were expanded with the amendment of Section §194, which was signed by Governor Cuomo this week.
Expanded New York State Pay Equity Law
The revisions to New York Labor Law § 194 signed by Governor Cuomo on Wednesday, July 10, 2019, will expand upon the equal pay law in meaningful ways.
First, the New York state law makes it illegal pay someone less based on characteristics beyond just sex including age, race, creed, color, national origin, sexual orientation, gender identity or expression, military status, sex, disability, predisposing genetic characteristics, familial status, marital status, or domestic violence victim status. In this regard, New York state will join other jurisdictions, like New Jersey and Washington State, to have a very expansive view of who is protected under the pay laws.
Second, the New York equal pay act was amended to allow employees can be compared even if they do not hold the “same” job. The new law would require only a showing that the employees are engaged in “substantially similar work, when viewed as a composite of skill, effort, and responsibility, and performed under similar working conditions.” Like similar expansions in California, New Jersey, Massachusetts, and elsewhere, this will increase the scope of who can be compared under these pay equity laws.
In combination, these provisions further expand upon the protections under the federal pay equity laws and will make it more challenging, and more important, for employers to be attuned to how employees are paid.
New York State Salary History Ban
The expanded pay equity law was not the only law signed into law on Wednesday in New York state. Governor Cuomo also signed into law a salary history ban, adding a new section to New York Labor Law § 194-a.
With the passage of this law, New York State will become the eleventh state (soon to be more, with the expected passage of New Jersey’s salary history ban, as noted below) with a salary history ban that applies to applicants for employment.
Like many of the salary history bans the New York State law will:
What is different from some of the other salary history bans -- for example, in California, is that is law also applies to current employees.
Exceptions to the New York Salary History Ban Law
While employers are forbidden to ask about prior wages, the law does not prevent an applicant or current employee from voluntarily, and without prompting, disclosing or verifying wage or salary history, including but not limited to for the purposes of negotiating wages or salary.
Further, the New York state law allows employers to confirm wage or salary history if, at the time an offer of employment with compensation is made, the applicant or current employee responds to the offer by providing prior wage or salary information to support a wage or salary higher than offered by the employer.
Finally, the law makes clear that it does not supersede any federal, state or local law enacted prior to the effective date of this section that requires the disclosure or verification of salary history information to determine an employee's compensation.
Damages Under New York State Salary History Ban
The law provides a private right of action to applicants or current or former employee. The court may award injunctive relief as well as reasonable attorneys' fees to a plaintiff who prevails in a civil action brought under this paragraph.
The New York state laws go into effect on January 6, 2020.
The New Jersey Salary History Ban Law
Just across the border, New Jersey is also poised to make modifications to its state pay equity laws.
More than a year after passing the sweeping pay equity legislation known as the “Diane B. Allen Equal Pay Act,” the New Jersey Legislature passed Assembly Bill 1094[AS1] [LINK TO LAW] on June 20, 2019, which would amend existing law to prohibit employers from screening applicants based on salary history, requiring applicants to satisfy any minimum or maximum salary criteria, or considering an applicant’s refusal to volunteer salary history information in any employment decisions. The Act also provides that a violation of these provisions would be an unlawful employment practice under the Law Against Discrimination (“LAD”), if the applicant is a member of a protected class.
This is the second attempt to pass salary history legislation in New Jersey. On July 31, 2017, former Governor Chris Christie vetoed a similar bill passed by the legislature. Governor Phil Murphy is widely expected to sign A1094 into law. On January 16, 2018, Governor Murphy signed an executive order banning salary history inquiries by state governmental entities. In doing so, he urged the legislature to pass a statewide ban on the practice and pledged to sign any such legislation that landed on his desk.
Key provisions of the Act are summarized below.
Unlawful to Screen Any Applicant Based on Salary History in New Jersey
Like in many other jurisdictions, as noted above, the New Jersey Act prohibits an employer from screening any job applicant based on salary history, including but not limited to wages, salaries, or benefits.
It would also prohibit an employer from requiring an applicant’s salary history to satisfy any minimum or maximum criteria.
Additionally, the Act would prohibit an employer from considering an applicant’s refusal to volunteer salary history in any employment decisions. Any violation by an employer of the aforementioned salary history inquiry prohibitions would also be an unlawful employment practice in violation of the LAD if the applicant is a member of any of the protected classes enumerated in the LAD.
Exceptions to the New Jersey Salary History Ban Law
The New Jersey Act contains several notable exceptions.
First, if an applicant voluntarily provides an employer with salary history information, the employer would be allowed to:
Second, after an offer of employment that includes an explanation of compensation has been extended to an applicant, an employer would be allowed to request that the applicant provide a written authorization to confirm the previous salary history.
Third, employers are not prohibited from acquiring salary history information that is publicly available, but shall not retain or consider that information when determining the salary, benefits, or other compensation of the applicant unless the applicant voluntarily, without employer prompting or coercion, provides the employer with salary history. Importantly, an applicant’s refusal to volunteer this information may not be considered by the employer in any employment decisions.
Further, the provisions of the Act would not apply to:
No provision of the Act would prohibit employers from:
Civil Penalties For Violations of the New Jersey Salary History Ban
An employer that violates the Act would be liable for a civil penalty not to exceed:
Interestingly, the Act makes clear that an award of neither attorney’s fees nor punitive damages would be available as a remedy for any violation of the salary history inquiry prohibition.
If signed, the law would go into effect six months after its enactment.
What’s Next for New York or New Jersey Employers?
These developments follow the trend of the equal pay movement taking place in cities and states nationwide. In light of New York and New Jersey’s focus on equal pay, employers should be mindful of these new restrictions and evaluate how the new legislation would impact their hiring practices.
 Eleven states (California, Colorado, Connecticut, Delaware, Hawaii, Maine, Massachusetts, Oregon, Vermont, Washington, and now New York), nine cities or counties (San Francisco, CA, Kansas City, MO, New York City, NY, Albany County, NY, Suffolk County, NY, Westchester County, NY, Cincinnati, OH, Toledo, OH, and Philadelphia, PA) and one Territory (Puerto Rico) have passed salary history bans. As noted in this alert, New Jersey is likely soon to join these ranks. In addition, Illinois has passed a salary history ban, which is also waiting for the signature of the Governor.