Zachary Glaser, Offit Kurman

Is it legal for an employer to request information about a job applicant's prior salary?

The answer to that question is not a simple yes or no but, increasingly, a matter of location and politics. Over the past few years, a number of states have been debating whether employers should be allowed to ask potential employees to disclose their salary histories. Opponents of the practice argue that by asking a candidate what she made at her last job, a company often propagates existing wage disparities, especially in regards to gender and race. Proponents maintain that historical salary information provides employers with the knowledge necessary to stay in business and remain competitive—and that banning disclosures can, in fact, hurt employees.

Nationally, this debate has been waged across party lines. Democrats tend to support bans on salary history requirements. Republicans tend to oppose them.

The Debate Until Now

As of this writing, seven states (as well as Puerto Rico) have banned employers from inquiring about candidates' pay histories—and equivalent laws will go into effect in two more states on Jan. 1, 2019. Additionally, Pennsylvania and New York have enacted limited bans, applying only to state agencies. Additionally, at least 9 cities and counties, including New York City, Chicago, Pittsburgh and, New Orleans, have enacted bans on salary history requirements. Philadelphia was the first U.S. city to pass a salary history ban, but a legal challenge put the legislation on hold earlier this year.

The states that have been passing salary history bans are across New England and the West Coast—home of California, perhaps the bluest of blue states. Meanwhile, in southern states and the “Rust Belt,” state laws have been passed prohibiting local governments from passing bans. There may be no issue in employment law nationally that so closely tracks along party lines in this way.

How State Laws May Change in 2019

From California to Massachusetts, virtually every jurisdiction that has outlawed salary history questions stands at the liberal end of the political spectrum. And following the recent U.S. midterm elections, several more states may soon join them.

Although the so-called “blue wave” did not entirely upend party control in the United States, it could end up marking a turning point in the debate over salary history laws. Numerous legislatures have seen their proposed bills banning pay history disclosures vetoed, fail to pass the state house or senate, or die in committee. A handful of these states “flipped” in the last election, replacing a Republican governor with a Democrat. Others are experiencing a groundswell of support radiating from urban areas such as New York City and Philadelphia. In either case, a statewide salary history ban may be coming sooner rather than later.

States Likely to Pass Salary History Bans in 2019

• Colorado: In May 2018, the Colorado Senate voted down House Bill 1377, which would have limited employers' ability to ask about applicants' pay histories. The Colorado Senate flipped from Republican to Democratic control in the 2018 midterms, increasing the likelihood of a similar measure soon becoming law.
• Illinois: In 2017 and again in 2018, Illinois Gov. Bruce Rauner (R) vetoed proposed amendments to the Illinois Equal Pay Act that would have prohibited employers from seeking salary history information. Rauner was defeated by J.B. Pritzker (D) in the 2018 elections. Look for an Illinois salary history ban to go into effect at some point in 2019.
• Maine: Gov. Paul LePage (R) vetoed a bill banning salary history disclosures in 2017. In 2018, Maine voters elected Janet Mills (D) to succeed LePage. Although Republicans maintain a narrow majority (18–17) in the Maine Senate, a similar measure is likely to be enacted into law given the near-victory of the 2017 bill.

Other Significant Updates from Battleground States

• New Jersey: An executive order signed by Gov. Phil Murphy (D), effective February 2018, bans state agencies from asking about a candidate's pay history. Senate Bill 559, introduced in 2018, would have prohibited private employers from the same, but died in committee.
• New York: Albany, Winchester and Suffolk counties, as well as New York City, have all banned salary history disclosures. In light of similar statewide legislation, which Gov. Andrew Cuomo advanced on April 10, 2018, a full ban appears inevitable.
• Pennsylvania: As alluded to above, opponents of salary history bans dealt a blow to a Philadelphia city ordinance earlier this year. On April 30, 2018, U.S. District Judge Mitchell S. Goldberg ruled that the law violates the First Amendment's free-speech clause and issued a preliminary injunction. However, while the judge determined that employers may ask about a candidate's prior wages, he clarified that they cannot use the information to determine pay. The case has been appealed.

• Washington: In April 2018, Washington enacted The Equal Pay Opportunity Act, which clarifies that an individual's previous wage or salary history is not a defense against a claim of discrimination. Additionally, Democratic state legislators expanded their majority in the 2018 election. In light of the recent pay equity law, however, the state Senate may not consider another wage bill a priority next year.

Next Steps

While it can be fascinating to witness statutes evolve state-by-state in real time, the current patchwork of salary history ban laws poses serious challenges for businesses. Any employer who hires staff in more than one state has a decision to make: maintain separate policies for each and every location, or set a single, companywide policy to comply with the most restrictive state in which the company operates. In terms of risk and cost management, the best choice may not easy to discern.

Regardless, employers should stay abreast of all legal updates on this topic and strive to look ahead, particularly in states where the political hue of the dominant party has shifted. Legal counsel can help employers cost-effectively create compliant hiring policies and strategize for possible and pending legislation.

Zachary Glaser, principal at Offit Kurman, resident in the Philadelphia office, concentrates his practice in the areas of labor and employment and business litigation.