California employers – Are you confused about what information you are (and are not) allowed to request under California’s new salary history ban law? Below are answers to some common questions regarding compliance with these new requirements.
What is the new salary history ban?
California’s salary history ban is set forth in newly created California Labor Code section 432.3. Under this code section, California employers are prohibited from “relying on the salary history information of an applicant for employment as a factor in determining whether to offer employment to an applicant or what salary to offer an applicant.” In other words, California employers cannot ask job applicants about their salary histories.
Can a job recruiter provide an employer with a candidate’s salary history?
No. The law expressly prohibits employers from seeking an applicant’s salary history “through an agent,” which would include an outside recruiter. To protect themselves, employers should take steps to ensure that their recruiters (whether internal or external) are not seeking salary history information from candidates as your company can be held liable for these violations.
Can I ask an applicant what benefits they received from a previous employer?
No. The law expressly prohibits employers from seeking an applicant’s salary history information, which includes “compensation and benefits.” This definitely means that employers cannot ask an applicant about the value of a benefit package. Whether an employer can ask if there are any benefits the applicant would be “losing” by accepting a position with your company is an issue that is yet to be determined. The law is not clear on the scope of the information a company is prohibited from seeking relating to benefits.
Can I still verify an applicant’s salary history after an offer of employment has been extended?
Yes. The state law does not prohibit employers from contacting an applicant’s previous employer(s) and verifying salary history after an offer of employment has been made. However certain localities (like San Francisca) prohibit employers from disclosing the salary history of a current or prior employee to a prospective employer with having first obtained written authorization from the employee.
Am I required to provide applicants with a salary range for a position?
Yes – if the applicant makes a “reasonable request” (either oral or written), the employer is required to provide a “pay scale” for that position to the applicant. In light of this requirement, it is recommended that employers prepare pay scales for positions for which they are hiring prior to posting open positions. When explaining this pay scale to applicants, consider explaining to the employee that the salary for the position will be based on factors such as qualifications and experience. Finally, all requests for a pay scale (and the company’s response to those requests) should be documented.
What if an applicant voluntarily provides his salary history?
The law does not prohibit applicants from “voluntarily and without prompting disclosing salary history information to a prospective employer.” If this does happen, it is recommended that employers document the voluntary disclosure, but still take steps to ensure that this disclosure is not the sole factor used in determining the individual’s salary if that individual is hired.