Written by Neresa De Biasi

On May 4th, New York City Mayor Bill de Blasio signed a law that will prohibit employers from asking about a prospective employee’s salary history or relying on salary history in determining compensation. This is likely to have a profound impact on New York City employers’ hiring and compensation practices. The law will go into effect October 31, 2017, 180 days after its May 4, 2017 signing.

The new law amends New York City’s Human Rights Law to make it an unlawful discriminatory practice for an employer or employment agency to:

  • Make any inquiries about the salary history of an applicant for employment; or
  • Rely on the salary history of an applicant to determine the salary, benefits, or other compensation for that applicant, unless the applicant voluntarily and without prompting discloses his or her salary history to the employer.

The law defines “salary history” to include an applicant’s current or prior wages, benefits, and all other forms of compensation. In addition to prohibiting seeking salary history directly from the applicant, the law also prohibits seeking salary information about the applicant from the applicant’s current or prior employers or any agent of the applicant’s current or prior employer, and prohibits searching for the applicant’s salary history in publicly available resources.

Although the law prohibits employers from inquiring about an applicant’s salary history, an employer will not be prohibited from engaging in discussions with the applicant about a position’s anticipated salary, the applicant’s expectations regarding compensation, or whether an applicant would forfeit any unvested equity or deferred compensation for leaving his or her current employer. An employer will continue to be able to speak with an applicant about “objective measures” of the applicant’s productivity, which could include revenue, sales, or other production reports.

The law provides some exceptions. The exceptions include:

  • verifying an applicant’s salary history, if the applicant disclosed the information voluntarily and without prompting
  • internal transfers or promotions with a current employer
  • background checks or verification of non-salary related information provided by an applicant. But if the background check discloses the applicant’s salary history, an employer may not rely on that information to determine the applicant’s compensation.
  • actions taken pursuant to a federal, state, or local law that specifically authorizes the disclosure or verification of salary history for employment purposes, or specifically requires knowledge of salary history to determine an employee’s compensation.

New York City employers should review their application, interview, and applicant verification processes to ensure their procedures comply with the provisions of the law. If you have questions about this update or integrating this law into your application and interview process or procedures, please contact the author of this article or an attorney at Clifton Budd & DeMaria, LLP.

About the Author
Neresa De Biasi
Neresa De Biasi joined the firm as an associate in March 2017. Ms. De Biasi previously served as an in-house...
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