In 2016, Massachusetts was the first state to pass a law that bans employers from asking candidates about their salary history. This new law has brought the gender pay equality issue to light across the country and since its passing, other cities and states have adopted similar laws and still more are jumping on this bandwagon. Reporting shows women earn about 80% of what men do in similar positions. Because of this, the Pay Equity Act’s purpose is to close that gap in pay between women and men performing comparable work. The law will go into effect officially on July 1, 2018, but I think we can expect it to change before that date as well as evolve over time. Along with the salary question ban, here are a couple other parts this act covers:
· Forbids employers from asking a job candidate about their salary history before extending an offer of employment, including compensation, to applicant.
· Prohibits employers from preventing workers disclosing or discussing salary information about their earnings or those of their colleagues.
· Bars employers from discharging or retaliating against employees for opposing any violations of the Act by the employer.
To help clarify, when an applicant discloses his/her salary history to a potential employer, the employer, in a way, gains the upper hand. Our perspective is this: the law assumes that an employer will only offer a candidate a similar (potentially higher) salary from his/her previous position, and not necessarily what the position’s salary range actually is or what the candidate’s skills and experience are worth.
Could this be accurate in today’s business world? Yes, we imagine so. And because women have historically been paid less for similar roles, that lower salary continues to follow them in every subsequent role they obtain.
Lawmakers are trying to fight systemic gender pay inequality and they believe this is the best way to do so. If an employer can’t ask a candidate’s previous salary, then employers are forced to pay what is actually appropriate for the role and skills of the candidate. There are still plenty of employers who offer rates to candidates that are within the budgeted range for the role and for the experience the candidate brings to the table. It’s those employers that should have little trouble with this transition.
This new law will certainly mix things up in New England with screening our candidates, but also working with and educating our customers.
