Kansas City is the latest locality to join the trend of regulating questions regarding current or former salary information when interviewing and hiring new employees.
The intent of these new laws is to end the cycle of pay discrimination. For example, women are less likely to negotiate for more salary and have historically been paid less than their male counterparts. Women may also take time off to have children and that too has an impact on their earning history. Basing their future pay on their past pay may not prevent or reverse any existing pay gap between them and equally experienced men.
These new laws and regulations are also an attempt to help close the wage gap. Employers need to know what a position is worth as you start the recruitment process. Each position should have a pay range that is clearly defined by what experience, education or special skill “buys”. It’s not proper for an organization to define pay based on what someone at their current or former job is being compensated. Compensation should be based on what the market in your area and industry pays for that position while balancing what your organization can afford (benchmark and build a pay structure that fits your culture and nonprofit).
Most of these laws and regulations do allow for you to ask an applicant what their expectations are regarding salary, benefits and any other compensation. However, you cannot ask what an applicant is currently being paid.
Kansas City’s new law applies to organizations employing six or more employees. It goes into effect on October 31, 2019. Currently, there are 17 statewide bans and 14 local bans.
The statewide bans for all employers include: California, Colorado, Connecticut, Delaware, Hawaii, Maine, Massachusetts, New Jersey, Oregon, Vermont, Washington and the Commonwealth of Puerto Rico.
States where bans apply only to state and/or public agencies are: Illinois, Kentucky, New Jersey, New York, North Carolina, and Pennsylvania.
Cities and counties with bans are: Albany, Atlanta, Chicago, Cincinnati, Kansas City, Louisville, Montgomery County, MD New Orleans, New York City, Philadelphia, Pittsburgh, Salt Lake City, Suffolk, and Westchester.
The laws in some places go further than just banning pay history inquiries. Some also prohibit employers from setting compensation based on volunteered salary history and others prohibit an employer from taking disciplinary action against employees who discuss pay with coworkers.
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