Employers Prohibited From Relying On Salary History in Making Hiring Decisions.

On Thursday, October 12, 2017, the Governor signed Assembly Bill 168 (“AB 168”) into law, which takes effect on January 1, 2018.  AB 168 applies to all employers and specifically prohibits employers from relying on the salary history information of an applicant for employment as a factor in determining whether or not to make a job offer to the applicant and should not have any effect on what salary to offer the job applicant. (See Full Article) LINK: The new law, which will be set forth in California Labor Code §432.3, also contains provisions prohibiting employers from seeking the salary history information about an applicant for employment and further requiring employers, after receiving a “reasonable request” from an applicant, to provide the applicant with the pay scale for that position. Notwithstanding the fact that employers are prohibited from inquiring into an applicant’s salary history, AB 168 specifically permits the applicant to voluntarily “and without prompting” disclose his or her salary history information to the employer.  Additionally, when the applicant voluntarily discloses his or her salary history, the statute does not prohibit the employer from considering or relying on that voluntarily disclosed salary history information in determining the applicant’s salary.   Unlike other Labor Code provisions, AB 168 specifies that a violation of its provisions would not be subject to the misdemeanor provisions of the Labor Code.

In light of the Legislature’s enactment of AB 168, employers should carefully review their employment hiring processes, including reviewing their applications and employment policies and procedures to make sure that they are complying with this and other recent changes in the law.  If you have any questions, feel free to contact our office and our attorneys will be happy to assist you.

Author:  Christopher L. Moriarty, Esq.