Effective January 1, 2018, new California Labor Code section 432.3 makes it a violation of law to ask a job candidate about the compensation and benefits the candidate earned at the candidate’s prior position(s). An applicant may voluntarily disclose his/her prior salary history, as long as it is done without prompting or encouragement from the potential employer. If disclosed voluntarily, the employer may use this information for purposes of determining the salary and benefits that will be extended to the applicant.
Although, employers are prohibited from asking about salary history, an employer may still ask what compensation and benefits the applicant is seeking.
In addition, the new law permits applicants to ask a prospective employer to provide a salary range for the open position. Employers must provide an applicant with the pay scale for the position, when it is requested.
What should employers do now?
- If you haven’t reviewed your employment application for compliance with state and federal laws, now is the time. Revise your application to remove any requests for salary history information. Including an inquiry such as, “Pay Desired” is still permissible.
- Prepare in advance before posting and advertising your open positions. Determine your pay ranges for each position in the event you receive inquiries from applicants.
- It is important to update your hiring process, particularly your screening and interviewing guidelines. Do not include questions about prior pay or benefits. You may inquire about compensation and benefits desired.
- Provide guidance and training to your managers and supervisors on interviewing best practices. They will need direction on how to respond to applicant inquiries about pay. They will also need to be reminded not to ask questions about prior compensation and benefits, as well as trained on how to handle an applicant’s voluntary disclosure of his/her salary history.
The text of the new legislation may be found here:
If you have questions about your hiring practices, you may contact the employment attorneys at Ferruzzo & Ferruzzo, LLP.