NYC Employers, Beware of What You Ask Your Applicants and Employees: NYC’s Salary History Inquiry Ban
On May 4, 2017, Mayor de Blasio signed into law an amendment to the New York City Human Rights Law, which makes it an “unlawful discriminatory practice” for an employer to inquire about or investigate an applicant’s salary history. New York City joins Massachusetts and Philadelphia with similar bans.
Specifically, the law prohibits employers from:
- Asking an applicant about his/her salary history, benefits or other compensation;
- conducting any search through publicly available databases for information about an applicant’s salary history and
- considering an applicant’s salary history in determining the compensation package to offer the applicant, unless the applicant “voluntarily” and “without prompting” discloses his/her salary history.
The law allows employers to ask the applicant about his/her salary expectations, including whether any unvested equity or deferred compensation would be forfeited if the applicant left his/her current employment.
The law goes into effect October 31, 2017. The New York Commission on Human Rights is the agency charged with enforcement and the penalties for violating the law are steep. The Commission may impose a civil penalty up to $125,000 for an unintentional violation, and up to $250,000 for a “willful, wanton or malicious act.” An individual may also file a lawsuit and recover backpay, compensatory damages and attorney’s fees.
Employers should update their applications to eliminate the question about salary history and inform everyone involved in the hiring process (including external recruiters) about the laws mandates.