Maryland Salary History Ban, Effective October 1, 2020

September 28th, 2020 | Angela Preston, Senior Vice President and Counsel, Corporate Ethics and Compliance with Ryan Hannan, Compliance Associate

Effective October 1, 2020, Maryland joins a growing list of state and local jurisdictions which restricts employers from inquiring into or considering applicants’ compensation histories. House Bill 123, An Act Concerning Labor and Employment (the “Act”), amends the state’s Equal Pay for Equal Work law in prescribed ways.

What Are the Amendments?

The Act prohibits all employers from seeking an applicant’s wage history either orally or in writing, and from relying on their wage history when considering employment decisions and determining their wages. An applicant’s wage history may be considered after a conditional offer, but only if it was provided voluntarily by the applicant for the purpose of supporting a wage offer higher than that offered by the employer. In such cases, employers are also permitted to confirm that wage history. Wage histories voluntarily provided by an applicant in this manner are permitted to be considered and confirmed only if the higher wage does not a create an unlawful pay differential based on sex or gender identity.

The Act further prohibits retaliation against or refusal to interview, hire, or employ an individual for not providing their wage history or for inquiring about the wage range of the position.

Violations of these prohibitions will be redressed by the Commissioner of the Division of Labor and Industry, who will order compelling compliance in response. At their discretion the Commissioner may also submit a letter compelling compliance when violations are determined, assess a penalty of up to $300 for each applicant for which the employer was noncompliant for second violations, and assess a penalty of up to $600 for each applicant for which the employer was noncompliant for subsequent violations occurring within 3 years of a previous violation. When assessing penalties, the Commissioner must consider the gravity of the violation, the size of the employer’s business, the employer’s good faith efforts, and their history of violations.

Maryland employers should review their hiring practices and policies in accordance with the Act and consult with their legal counsel. Employers should stay informed on the growing trend of salary history bans and remain abreast of these and other employment laws in jurisdictions where they hire and are located. Other jurisdictions which have recently enacted salary history bans include Colorado, Philadelphia, PA; Washington, DC; and Toledo and Cincinnati, OH, among a growing list of others.

The full text of the Act can be found Here.

The information contained herein is for informational purposes only.  Clients are encouraged to consult with their legal counsel on the impact of this new law.  Sterling is not a law firm, and none of the information contained in this notice is intended as legal advice.

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