May 29, 2019

California law prohibits California employers from requesting a job applicant’s salary history (either orally or in writing) and from relying on the applicant’s salary in determining whether to make an offer of employment to the applicant or in determining what salary to offer the applicant.  [Lab. Code § 432.3.] This also applies to inquiries regarding compensation and benefits and requires employers, upon request by prospective employees, to provide prospective employees with a salary scale for the position sought.

Labor Code section 432.3 was proposed by female legislators in an attempt to close the pay gap between men and women.  The law survived opposition which argued that it violated employers’ first amendment rights.  One exception to Labor Code section 423.3 is that it does not prohibit the employer from relying on the applicant’s salary history in determining compensation and other benefits if the applicant voluntarily, and without prompting by the employer, discloses his or her salary history to a prospective employer.  However, the employer cannot consider that information in determining whether or not to hire the applicant.  This law also does not prevent an employer from asking an applicant about his or her salary expectation for the position being applied for.

Keep in mind that this law also does not apply to salary history information available to the public pursuant to federal or state law, such as the California Public Records Act or the federal Freedom of Information Act.  Also, salary information for public employees is generally a matter of public record.  Additionally, this law does not change California’s Equal Pay Act under Labor Code section 1197.5, which states that prior salary alone cannot justify any disparity in compensation paid to employees of the opposite sex or another race or ethnicity for substantially similar work.

To be in compliance, employers across the state should brief all hiring personnel on issues that can cause them to violate this law.  Employers should do the following:

–  Train all hiring personnel (including external hiring agencies and anyone who may be interviewing candidates) to prevent them from indirectly or inadvertently asking job applicants about their salary history.

–  Prepare all hiring personnel on how to respond if an applicant volunteers his or her salary history or requests a pay scale for a particular position.

–  Modify all recruitment guidelines and job applications to ensure they do not impermissibly seek and rely upon an applicant’s salary history information.

–  Update and review the company website to ensure the same.

–  If the company uses electronic onboarding of applicants or other similar tools, make sure all inquiries into salary history information are deleted.

–  Take steps to remain up to speed on all equal pay legislation in all the jurisdictions in which the company hires new employees.

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This article is based on the law as of the date posted at the top of the article. This article does not constitute the provision of legal advice, and does not by itself create an attorney-client relationship with Eskridge Law.