Employment Law Observer

In the spirit of the season, we are using our annual "12 days of the holidays" blog series to address new California laws and their impact on California employers. On this eleventh day of the holidays, my labor and employment attorney gave to me: eleven pipers piping and SB 1162.

The pending Salary Transparency Law (the Law)—which requires New York City employers to disclose the minimum and maximum salary when posting an advertisement for a job, promotion, or transfer opportunity—was  further clarified by the New York City Commission on Human Rights and subsequently amended by the New York City Council.

On December 15, 2021, the New York City Council approved a bill amending the New York City Human Rights Law, transforming how employers advertise a job listing. Mayor Eric Adams chose not to veto the legislation before the January 14, 2022 deadline, therefore the new law is set to become effective on May 14, 2022.

Illinois Governor J.B. Pritzker signed SB 1480 into law on March 23, 2021. Effective immediately, the law significantly amends the Illinois Human Rights Act (IHRA), Illinois Equal Pay Act (IEPA), and the Illinois Business Corporation Act. The amendments affect employers' ability to use criminal conviction records in employment decisions and imposes new reporting requirements regarding pay equity.

In the spirit of the season—and keeping some semblance of normal—we are using our annual "12 days of the holidays" blog series to address new California laws and their impact on California employers. On this ninth day of the holidays, my labor and employment attorney gave to me: eleven pipers piping and SB 973.

Nearly 60 years after the passage of the Equal Pay Act of 1963, we find that the gender pay gap is not only alive and well, but also remains a subject of controversy. This was apparent in the Ninth Circuit's ruling in Aileen Rizo v. Jim Yovino, which we've been following since the Ninth Circuit heard the case. This is the highest-profile court to address the use of salary history—and its intersection with the Equal Pay Act—in the employment setting.

On July 31, 2019, Illinois joined a growing list of state and local governments that have banned employers from using salary history in the hiring process. For those keeping count, there are now 18 state bans and 18 municipal bans nationwide. Illinois adopted its salary history ban through an amendment of the Illinois Equal Pay Act of 2003. Once the ban goes into effect, Illinois employers, employment agencies, and staff will be prohibited from seeking salary history information from a job candidate or her past employer. The main purpose of these bans is to bridge the wage gap between men and women doing the same or similar jobs. Many believe salary history information is used to perpetuate the long-running salary differences between the sexes, because employers have historically set starting salaries based on last reported wages by the applicant. The ban brings significant changes for employers, so it is likely that litigation in this area will increase. Fortunately, there are proactive steps employers can take to prepare for the ban, which goes into effect September 29, 2019.

Use of one's last salary or salary history to determine compensation can be a proxy for sex discrimination. Once considered a legitimate "factor other than sex," some jurisdictions are banning the use of a job candidate's salary history to determine compensation as it has perpetuated pay inequities between the sexes. The Ninth Circuit Court of Appeals is the highest-profile court to address, and ban, use of salary history in the employment setting in most (but not all) cases.

Recently, the Massachusetts Attorney General, Maura Healey, issued guidance to assist employers in complying with the state’s Equal Pay Act (“MEPA”), which goes into effect on July 1, 2018. The 30-page guidance is comprehensive, offering an overview of the law, responses to frequently asked questions, a self-evaluation for employers, and a sample checklist of policies and practices. Due to its length and breadth, the guidance should be reviewed by employers in full. However, we note the following important aspects:

Beginning July 1, 2018, it will be illegal for San Francisco employers to ask job applicants to disclose their salary history. A number of similar laws have been enacted in cities and states across the country to address the gender and minority pay gaps.

In a developing trend, Delaware followed Massachusetts, Oregon, New York City and Philadelphia, in enacting legislation directed at ensuring equal wages between genders.  On June 14, 2017, Governor John Carney signed legislation, which prohibits prospective employers from asking job applicants about their salary history.  The reasoning behind these laws is that wage disparities are perpetuated when current pay is based on past salary decisions that may have been based on gender.  Rather, employers are encouraged by these new laws to assess potential pay based solely on merit, experience of the job applicant and the market rates.

On May 4, 2017, New York City Mayor Bill de Blasio signed into law, Intro No. 1253-2016, amending the New York City Human Rights Law to restrict an employer’s ability to ask job applicants about their compensation history during the hiring process. The law will take effect on October 31, 2017.

On Monday, with the signing of the Philadelphia Wage Equity Ordinance, the city's Fair Practices Ordinance was amended to prohibit employers from asking about an applicant's wage history at any point during the hiring process, making Philadelphia the first City to enact such a prohibition. 

On August 1, 2016, Massachusetts Governor Charlie Baker signed An Act to Establish Pay Equity, which as the name aptly suggests, seeks to ensure equal pay for comparable work for all Massachusetts workers and equal opportunity to earn competitive salaries. The Act will take effect on January 1, 2018.