New York Salary History Ban FAQs Explained
February 18th, 2020 | Angela Preston, Senior Vice President and Counsel, Corporate Ethics and Compliance
In 2019, Governor Cuomo signed a bill to establish Labor Law Section 194-A (the “Restrictions”) to prohibit employers from inquiring into applicants’ and employees’ wage or salary (“Compensation”) history information, and from using such information in employment and compensation decisions.
The restrictions took effect on January 6, 2020, and the State’s website has posted a list of FAQs to provide clarity and increase understanding of compliance requirements for employers. These FAQs and their responses provide the following insights regarding the restrictions and their applicability:
- “Applicant” is defined as, “someone who took an affirmative step to seek employment with the employer and who is not currently employed with that employer, its parent company, or a subsidiary. This includes part-time, seasonal, and temporary workers; regardless of their immigration status.”
- Restrictions apply to current employees seeking promotions
- Restrictions apply to applicants and employees who will be working in the State, regardless of where the employer is based
- Employers may inquire about an applicant or employee’s salary expectations for the position
- Employers may consider compensation history information if it was voluntarily disclosed by the applicant or employee, however voluntary disclosure may not be presented to them as optional and may only be considered if disclosed without any prompting by the employer. The FAQs recommend that employers state in job postings that they do not seek compensation history information
- Voluntarily disclosed compensation history information cannot be used to justify pay differences between employees for substantially similar work
- Position pay scales or salary ranges are not required in job postings unless otherwise required under a collective bargaining agreement
- Other parties, such as former employers, may not be asked about an applicant or employee’s compensation history, but they may confirm information if it was voluntarily disclosed
- Employers may inquire about compensation history if required by other federal, state, or local law, or if the applicant or employee is a bona fide independent contractor, freelance worker, or other contract worker not employed through an employment agency
- Restrictions apply in New York City, and to all public employees unless otherwise required by law
- Applicants and employees may bring civil court actions or contact the Division of Labor Standards if they believe an employer committed violations. They are protected from retaliation regarding submitting complaints or refusing to provide compensation history information
Employers should consult with their legal counsel regarding their current practices for hiring and compensation determination for New York applicants and employees. Sterling clients can contact their account representative with questions about their background screening program. Want to learn more about our background checks and identity services? Start a conversation with our team of experts today.
The full text of the FAQs can be found here.
This publication is for informational purposes only and nothing contained in it should be construed as legal advice. We expressly disclaim any warranty or responsibility for damages arising out this information. We encourage you to consult with legal counsel regarding your specific needs. We do not undertake any duty to update previously posted materials.