A bill was proposed in Congress last week that would ban employers from asking job applicants for their salary history. The purpose behind the legislation is to help close the gap in women’s and men’s pay. A worker’s salary history can follow them from job to job, which can make it difficult for women to move out of lower paying positions. In 2015, women made about 80 cents for every dollar men earned.
The representative who introduced the bill said that it’s critical that Congress ban the practice of asking for salary history. She claims that a salary history disadvantages minorities and women, who typically earn lower salaries throughout their careers. She says that the bill would require employers to offer salaries to applicants based on their merit, not their gender, race or ethnicity. The bill would also prohibit employers from basing salaries on previous benefits, as well as would prevent employers from firing an employee who complains about being asked about salary history. If companies violated the law, they could sue for up to $10,000.
There are a few areas in the country where asking for a salary history from a prospective employee is illegal, including in Massachusetts, Washington, D.C., New York City, and Philadelphia. In most of the country, it is legal for employers to ask about salary, and to base a new employee’s salary on what they were paid at their former job.
In California, the Ninth Circuit recently ruled that asking about salary history is not discriminatory. In that case, a woman was hired at Fresno County public schools as a math consultant for $63,000 a year. The county had a policy that added five percent to her previous pay as a math teacher in Arizona, but that was not enough to meet the minimum salary for her position, so it increased her pay. During a lunch break with coworkers three years later, she discovered that her male counterparts were making more than she was.
She filed a lawsuit, claiming that she was illegally discriminated against because of her sex. She argued that asking for her previous salary perpetuated discrimination against her. The county argued that basing starting salaries primarily on previous pay prevents subjection determinations of what a new employee should be paid. The county then added five percent as an incentive to encourage qualified workers to leave their positions to work for the county.
The lower court ruled that pay differences based exclusively on prior salaries were discriminatory under the Equal Pay Act. The Equal Pay Act, which was signed into law in 1963, makes it illegal for employers to pay women less than men for equal work performed under similar working conditions, just because of their sex. There are exemptions when pay is based on other factors, such as merit or seniority.
The case was appealed and went to the Ninth Circuit. The Ninth Circuit ruled that employers can legally pay women less than men for the same work, if the pay is based on differences in the workers’ previous salaries. The court noted that employers can use previous salary information as long as it was applied reasonably, and there was a business policy that justified it.
If you believe that you are being paid less because of your gender, you should speak with an attorney. There may be valid reasons you are paid less, or your employer may have violated the law. If you are in the Bay area, call Micha Star Liberty, Oakland employment discrimination attorney at 510-645-1000. She can help. Call to learn more or to schedule a free consultation.