Nicole Rice

Assembly Set to Vote on Bill to Limit the Use of Salary History in Hiring

By Nicole Rice, Policy Director, Government Relations

Capitol Update, May 22, 2015

AB 1017 by Assembly Member Nora Campos (D-San Jose) would limit how employers can use a candidate’s salary history during the hiring process. Supporters argue that providing such information perpetuates gender pay inequality by preserving historical inequities that are imbedded in one’s salary history. CMTA believes the bill limits an employer’s inquiry into relevant information and exposes employers to additional litigation, despite the lack of any actual harm to the job applicant.

As recently amended, AB 1017, precludes asking an applicant for their salary history during an interview or as a condition of employment and prevents an employer from releasing the salary history of a current or former employee without their written consent. A more objectionable provision related to establishing a “minimum rate of pay” for advertised positions under which the employer could not compensate the candidate was removed from the measure. While this deletion made the bill marginally better, CMTA remains opposed.

A large employer coalition opposes this measure and we have argued that by requesting salary information, employers can adjust any unrealistic expectations or salary ranges to match the current market rate for the advertised job position. This has worked to the benefit of the applicant/employee. Additionally, it can be utilized as a reference regarding whether the employee’s expectations of compensation that may far exceed what the employer can realistically offer. Requiring both the applicant and employer to waste time on the interview process to then ultimately learn at the end of the process that the employee would never consider taking the compensation offered is unnecessary.

Furthermore, the actual concern with regards to wage disparity is in the final compensation offered and paid to the applicant in comparison to those in the same job category. Protections already exist in both federal and state law that protect against this type of wage discrimination by precluding employers from paying their female employees less, even if the employee’s prior salary was lower than her male counterparts.

AB 1017 is before the full Assembly awaiting action. It is sponsored by the California Employment Lawyers Association and the American Association of University Women.

 

 

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