Prospective Employers Prohibited From Asking About Salary History in NYC

Edgar M. Rivera, Esq.

On May 4, 2017, Mayor Bill de Blasio signed a law prohibiting employers from inquiring about a prospective employee’s salary history, which goes into effect on October 21, 2017. The Office of the Mayor hopes that preventing employers from asking questions during the hiring process about an applicant’s previous compensation—which is often used as a benchmark for a new employee’s starting pay—will end the “perpetuating cycle of suppressed wages” for minorities.

The new law prohibits an employer from asking about or using a job applicant’s compensation history to determine their salary during the hiring process, including the negotiation of a contract. An applicant’s salary history includes their current or prior wage, salary, benefits, or other compensation.  Employers are still allowed to discuss expectations about salary, benefits, and other compensation with a job applicant.  Further, if an applicant, voluntarily and without prompting, discloses their salary history to an employer, the employer may consider that information in determining the applicant’s salary, benefits and other compensation.

Women and Black and Latino men across the United States earn less on average than their white male counterparts. According to U.S. Census Bureau data, the mean income for women in New York City was equivalent to just 80 percent of what men earned—a gap of $10,470. The report also showed that, across the United States, women who are employed full-time lose a combined total of more than $840 billion each year due to the gender wage gap.  And, according to 2015 U.S Census Bureau data, women earn approximately 80 cents on the dollar compared to their male counterparts.  According to the Pew Research Institute, in 2015, black men earned 73 percent of white men’s hourly earnings, while Hispanic men earned 69 percent. This translates to average hourly wages for black and Hispanic men of $15 and $14, respectively, compared with $21 for white men.

“Inquiring about pay history during the hiring process often creates a cycle of inequity and discrimination in the workplace, which perpetuates lower salaries for women and people of color,” said Chair and Commissioner of the New York City Commission on Human Rights Carmelyn P. Malalis. “By taking salary history information out of the job interview and application process, employers and job applicants can engage in robust salary negotiations focused on the applicant’s qualifications and the requirements for the job. The Commission is committed to aggressively enforce the law when it becomes effective later this year and encourages New Yorkers to come forward and seek help if they have been the victims of discrimination.”

Once the law goes into effect next month, affected individuals will be able file a complaint with the New York City Commission on Human Rights, which may fine employers with civil penalties for willful and malicious violations of the law, and can award compensatory damages to victims, including emotional distress damages.

If a prospective employer has unlawfully asked you about your salary history or otherwise violated your rights under federal, state, or city employment laws, contact The Harman Firm, LLP.