On May 4, 2017, Mayor Bill de Blasio signed into law an amendment to the New York City Human Rights Law that now restricts employers in New York City, with four or more employees, from inquiring into a prospective employee's salary history during the interview and hiring process. The restriction is part of a growing trend across jurisdictions to reduce the likelihood that women will be prejudiced by prior compensation levels and help break the cycle of gender pay inequity. The restriction takes effect on October 31, 2017.
Specifically, the law makes it an unlawful discriminatory practice for an employer to inquire about the salary history of a job applicant, or to rely on a job applicant's salary history in determining the salary, benefits, or other compensation to be offered to a job applicant. Employers are also prohibited from making salary inquiries to an applicant's current or prior employer (as well as their present or former employees or agents) for the purpose of obtaining the applicant's salary history, and from conducting a search of publicly available records or reports for the purpose of obtaining an applicant's salary history.
"Salary history" includes not only an applicant's current or prior compensation, but also benefits and any other form of compensation that he or she may have received.
The law contains a few exceptions, namely:
Without inquiring about salary history, employers may engage in discussion with the applicant about their expectations with respect to salary, benefits, and other compensation including, but not limited to, unvested equity or deferred compensation that an applicant would forfeit or have cancelled as a result of the applicant resigning from his or her current employer.
If an applicant voluntarily and without prompting discloses salary history to an employer, then the employer may consider such salary history in determining salary, benefits, and other compensation to be offered to the applicant. Further, the employer may verify the salary history.
The law does not apply to applicants for internal transfer or promotion with an employer.
The law also does not prohibit employers from verifying an applicant's non-salary related information or from conducting a background check. However, if in doing so, an employer inadvertently learns about the applicant's salary history, the employer cannot rely on that information for purposes of determining salary, benefits, or other compensation to be offered to the applicant.