Manufacturers in Alaska, Arizona, California, Connecticut, Hawaii and Vermont face new limits on the use of an employee’s salary history.
The state legislatures in Connecticut and Vermont have both adopted laws banning manufacturers from asking about an applicant’s prior salary. Those laws are expected to be signed by the Governors of those states and will take effect on January 1, 2019. The provisions allow manufacturers to ask applicants about their salary or wage expectations, so long as the manufacturer does not ask about an applicant’s prior salary or pressure an applicant to disclose salary history. Both laws allow salary history inquiries when required by other federal or state laws. A similar law has been introduced in the New York legislature by Governor Andrew Cuomo. Its prospects are not certain as of this writing. New York City banned inquiries about and the use of salary history effective October 2017. See prior blog post “New York City’s Salary History Ban Takes Effect October 31.”
Meanwhile, in Rizo v. Yovino (April 9, 2018), the Ninth Circuit Court of Appeals held that an employee’s salary history could not be used to defend a claim under the Equal Pay Act. The court rejected the contrary views of both the EEOC and several sister Courts of Appeal to the effect that prior salary along with other factors could be used in making compensation decisions. The Ninth Circuit covers manufacturers in Alaska, Arizona, California and Hawaii.
In light of these developments, part of a growing trend across the United States, manufacturers may wish to review their employment applications and interview guidelines to limit inquiries into salary history in these jurisdictions and continue to watch this space for updates.