Are You Ready to Comply With the NYC Pay History Ban?

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On October 31, 2017, the New York Salary History Law (the “Law”) goes into effect, making it illegal for employers to inquire about a prospective job applicant’s salary history or to rely on that history during the hiring process.  Cole Schotz previously blogged about the legislation in posts NYC Pay History Ban: Combating Wage Disparity and NYC Pay History Ban to Take Effect October 31, 2017.

The Law, an amendment to the New York City Human Rights Law, prohibits an employer, an employment agency, and an employer’s agent or employee, from making inquiries regarding an applicant’s salary history other than in certain specifically enumerated situations.  The amendment defines the term “inquiry” broadly to include not only communicating a question to an applicant or his/her current or former employer about such salary history, but also includes searching publically available records or reports to obtain an applicant’s salary history.

The New York City Commission on Human Rights recently released Frequently Asked Questions (“FAQs”) concerning the Law, including the scope of coverage under the Law, what employers can and cannot do to learn about a job applicant’s salary expectations, the definition of “compensation” under the Law, and employer best practices. By way of example, the FAQs discuss whether an employer may conduct a background check in New York that includes information about an applicant’s salary history.  Hint: according to the FAQs, “in circumstances where an employer is legally permitted to perform a background check … the Commission recommends that employers specify to reporting agencies that information about salary history be excluded from the report.”  See FAQs, Section II.

The FAQs also specify “best practices” that an employer can implement to comply with its obligations under the Law including:

  • During the hiring process, focus questions on applicants’ salary demands, skills, and qualifications.
  • Ensure that job applications and other forms do not include questions about applicants’ salary history, even if such questions are framed as “voluntary.”
  • Modify written policies and educate interviewers and hiring staff to prohibit inquiries about applicants’ salary history.

See FAQs, Section V.  The FAQs are expected to be updated as necessary to facilitate compliance with the Law.

The Commission on Human Rights has also released a Job Applicant Fact Sheet and an Employer Fact Sheet advising applicants and employers, respectively, who is protected under the Law and what conduct is allowed under the Law.

Employers should ensure that all employees and agents, including, but not limited to, their human resources professionals and recruiters, are aware of the Law and their required compliance by October 31, 2017.  All employment applications and hiring materials should also be amended to omit any reference to salary history.

As the law continues to evolve on these matters, please note that this article is current as of date and time of publication and may not reflect subsequent developments. The content and interpretation of the issues addressed herein is subject to change. Cole Schotz P.C. disclaims any and all liability with respect to actions taken or not taken based on any or all of the contents of this publication to the fullest extent permitted by law. This is for general informational purposes and does not constitute legal advice or create an attorney-client relationship. Do not act or refrain from acting upon the information contained in this publication without obtaining legal, financial and tax advice. For further information, please do not hesitate to reach out to your firm contact or to any of the attorneys listed in this publication.

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