We have previously analyzed the growing trend around the country to ban employer inquiries into an applicant’s prior salary. This advisory addresses frequently asked questions about the new California law, which goes into effect on January 1, 2018.
Question: Can California employers ask applicants (or candidates) what they are making at their current job? What about at their previous jobs?
Answer: No and no.
Question: Can California employers ask applicants what benefits they receive at their current job? What about their previous jobs?
Answer: No and no.
Question: Can California employers suggest that it would be helpful to know about an applicant’s compensation for purposes of matching or beating it (or for some other positive reason)?
Answer: No, the employer may not “prompt” the applicant to offer information about prior compensation, even if it is for a reason that may benefit the candidate.
Question: Is it okay if the applicant volunteers prior compensation information?
Answer: Yes, as long as the information is offered “voluntarily and without prompting.”
Question: If the applicant volunteers prior compensation information, can California employers discuss the information with the applicant?
Answer: Yes, the employer and applicant may discuss information that is volunteered, but the employer must be very careful not to probe for information beyond what the applicant has volunteered. It may be safer to ask what the applicant is expecting (or hoping) to be paid for the position being sought.
Question: Can California employers confirm salary information that an applicant volunteers?
Answer: Maybe. The law is silent on whether the employer is allowed to confirm the compensation information that was volunteered. Employers should proceed cautiously before attempting to confirm salary information and do so only when justified and with the applicant’s permission – and be careful not to probe beyond the information already disclosed.
Question: Can California employers rely on or use the salary information that the applicant volunteers?
Answer: No and yes. The employer cannot use compensation or benefit information in deciding whether or not to make an offer. However, information that is freely volunteered may be used in deciding what compensation to offer the applicant.
Question: So California employers can use the applicant’s salary history (if volunteered) in deciding what to pay the applicant?
Answer: Yes, to an extent. The salary history can be considered in setting the salary offered if the information was freely volunteered without prompting. However, prior salary alone cannot, by itself, justify a difference in pay between the applicant and another employee of a different race or gender employed in a similar position.
Question: If the applicant asks what the position pays, do California employers have to respond?
Answer: Yes. The law requires that employers disclose the pay range of the position that the applicant is applying for, upon request of the applicant.
Question: Can California employers just provide an average estimated salary so they don’t have to disclose the high end of the range?
Answer: No, the law says employers must provide the “pay scale,” and employers must be truthful.
California Employers Need to Train Now . . . And Stay Tuned
Prohibiting salary inquiries is an evolving area of law throughout the country. Davis Wright Tremaine will continue to monitor developments in this area. For now, employers in California should ensure that their hiring managers, recruiters, and interviewers are aware of the kinds of questions they can – and cannot – ask applicants during the hiring process.