Salary History and Equal Pay Laws Clarified

News of the Pay Privacy law prohibiting reliance on an applicant’s salary history in determining employment and pay hit the business world at the end of 2017 and went into effect in January 2018.  Since pay is a large factor in the hiring decision, the new law raised many questions among business owners who are especially concerned about complying with California employment laws.  Some of the common questions related to the salary history requirements and equal pay were: Is it legal to ask an applicant about their desired salary or salary requirement? Am I liable if an applicant voluntarily gives me their salary history or what they made a their last job? If an applicant voluntarily discloses their salary history, can I take that information into consideration? What about a current employee, I already know what they make, so can I take their salary into consideration to determine raises or pay for a new or different position? The conflict between California labor and employment laws and the practical questions that business owners must ask and take into consideration in order … Continue reading

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New Law 2018 – Pay Privacy

“What did you make at your last job?” will be an illegal question when asked of a job candidate in 2018.  California’s Governor Jerry Brown signed AB-168, the salary privacy bill, into law on October 12, 2017.  The law goes into effect on January 1, 2018, and applies to all California employers regardless of size and whether they are in the private or public sector. There are three main parts to the new Section 432.3 of the California Labor Code: An employer shall not rely on an applicant’s salary history as a factor in determining whether to offer employment to an applicant or what salary to offer an applicant. An employer shall not, in any way, either directly or indirectly through third parties, seek an applicant’s salary history information (compensation and benefits). An employer, upon reasonable request, shall provide the pay scale for a position to an applicant applying for employment. However, employment applicants may voluntarily disclose their prior salary history (without prompting), in which case, the employer may use the voluntarily provided salary history in determining that applicant’s salary.  … Continue reading

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Equal Pay Day

April 4, 2017, is “Equal Pay Day,” which is an apt time to remind employers of the risks that lurk beneath unexamined practices, subconscious biases, and general human fallibility. By the numbers: 20% = average wage gap between men and women in the United States. (Institute for Women’s Policy Research) 58% = companies that track salaries in comparable roles by gender. (LeanIn.Org and McKinsey & Company) I’m surprised the number is that high because I have yet to come across a company that conducted a pay audit by gender before coming to me. 1,075 = charges filed with the EEOC under the federal Equal Pay Act in 2016. (EEOC) $8.1 Million = benefits paid out as a result of charges for Equal Pay Act violations with the EEOC in 2016. (EEOC) Why are we still talking about pay gaps in 2017? Fortune.com provides a short outline of why the gender pay gap still exists, citing the “motherhood penalty;” deficits in negotiation; and employer bias. Our company doesn’t engage in pay discrimination. If you have done a pay audit and can … Continue reading

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