Maine Joins States that Ban Salary-History Inquiries

 

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Maine recently became the latest state to ban employers from asking job candidates about their current or past earnings.

In addition to Maine, seven states prohibit private employers from asking about past pay: California, Connecticut, Delaware, Hawaii, Massachusetts, Oregon and Vermont. Some localities also ban such inquiries, including Cincinnati (starting in 2020), New York City, Philadelphia (pending a legal challenge), Puerto Rico and San Francisco, as well as several counties in New York.

We've rounded up the latest news on this topic from SHRM Online and other trusted outlets.

Maine's New Law

Legislative Document 278 prohibits employers from asking about a job candidate's compensation history until after a job offer—including compensation terms—has been presented. Additionally, under the new law, employers can't directly ask a candidate's current or former employer for salary information or stop current employees from discussing their own or another employee's wages. However, employers can confirm a candidate's past pay if the candidate voluntarily discloses it, and the law does not apply if an employer "inquires about compensation history pursuant to any federal or state law that specifically requires the disclosure or verification of compensation history for employment purposes."

(National Law Review)

Supporters Seek to Close Gender Pay Gap

Proponents of Maine's new salary-history inquiry ban, which was sponsored by Democratic Sen. Cathy Breen, said the law will help close the gender pay gap by discouraging employers from using past pay to set starting salaries and potentially perpetuating wage discrimination. State lawmakers approved the bill on April 2—National Equal Pay Day. The National Partnership for Women & Families estimated that female full-time workers in Maine are paid 82 cents for every dollar a man earns.

 (U.S. News and World Report)

[SHRM members-only toolkit: Managing Pay Equity]

Growing Trend

Even employers in jurisdictions without salary-history bans should pay attention to this growing trend because their jurisdiction may be considering a ban—or their competitors may have already nixed salary inquiries from their hiring process. Employers should consider whether they need salary-history information for legitimate business purposes in places where it still can be collected, according to an employment attorney.

(SHRM Online)

Employers Join Consortium to Close Wage Gap

Starbucks has pledged to eliminate the gender pay gap and has joined the Employers for Pay Equity Consortium. Twenty-six organizations signed the pay equity pledge on Equal Pay Day, including Accenture, Chobani, Cisco, Deloitte, Ikea, L'Oreal, Lyft, Pepsico and Starbucks. The pay equity practices and tools Starbucks pledged to uphold include not asking job candidates about their salary histories, removing caps on promotional increases and providing a candidate with the pay range of a position if requested.

(SHRM Online)

Democrats Seek National Ban

The U.S. House of Representatives passed the Paycheck Fairness Act (H.R. 7) in a 242–187 vote March 27. If the bill is ultimately signed into law, it would prohibit employers nationwide from asking job applicants about their salary histories and require them to prove that pay disparities between men and women are job-related. The bill passed the House mostly along party lines and is expected to stall in the Republican-controlled Senate. Critics say the bill, as currently written, won't effectively end gender pay disparity.

The Society for Human Resource Management (SHRM) agrees that salary history should not be the sole factor in setting compensation. However, "employers should have the ability to discuss salary expectations with prospective employees," said SHRM President and Chief Executive Officer Johnny C. Taylor, Jr., SHRM-SCP, in a letter to Congress. "Salary expectations help employers establish value of the position to the organization as well as competitiveness of the market."

(SHRM Online)

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