The Equal Pay Act of 1963, codified as 29 U.S.C. § 206(d), prohibits employers from paying wages that discriminate based on sex. This federal statute affects all employers with 15 or more employees, including state and local governments.
As of January 1, 2020, the salary history ban applies to employers with 4 or more employees in some states.
Salary History Ban Framework
The salary history ban, also known as the Massachusetts Act Relative to Equal Pay, M.G.L. c. 149, § 105A, prohibits employers from asking about salary history during the hiring process. This law aims to reduce the gender pay gap by eliminating the use of previous salaries to determine current compensation, with a penalty of up to $10,000 for non-compliance under 29 C.F.R. § 1620.12. In plain terms, this means that employers cannot use an applicant’s previous salary to justify paying them a lower wage.
This is where the law gets teeth, as employers who violate the salary history ban can face lawsuits under the federal law, with a statute of limitations of 2 years under 29 U.S.C. § 255, or 3 years for willful violations. The court may award back pay, liquidated damages, and attorney’s fees, with a total award not exceeding $50,000 under 29 U.S.C. § 216. In practice, this means that employers must be careful when discussing salary with job applicants to avoid any potential liability.
Under the federal law, employers are allowed to discuss salary expectations and requirements for the position, but they cannot ask about the applicant’s previous salary, within the 30-day time limit for responding to a complaint under 29 C.F.R. § 1620.12. The applicant must also be given the opportunity to respond to any salary-related questions, with a 10-day time limit for the employer to provide a written response under 29 C.F.R. § 1620.13.
Types of Salary History Bans
There are several types of salary history bans, including state and local laws, which can vary significantly. The California Fair Pay Act, Cal. Lab. Code § 1197.5, is one example of a state law that prohibits employers from asking about salary history.
State Laws
Some states, such as New York, N.Y. Lab. Law § 194-a, and New Jersey, N.J. Stat. Ann. § 34:6A-25, have enacted their own salary history bans, with a $5,000 penalty for non-compliance under N.Y. Lab. Law § 198. These laws can provide greater protections for employees than the federal law, with a 6-year statute of limitations under N.Y. Lab. Law § 198.
In plain terms, this means that employers must comply with both federal and state laws when it comes to salary history bans, within the 60-day time limit for responding to a complaint under N.Y. Lab. Law § 194-a. For example, in California, employers are prohibited from asking about salary history, with a $10,000 penalty for non-compliance under Cal. Lab. Code § 1197.5, and must also provide equal pay for substantially similar work, with a 2-year statute of limitations under Cal. Lab. Code § 1197.5.
Local Laws
Some cities and counties have also enacted their own salary history bans, such as the New York City Human Rights Law, N.Y.C. Admin. Code § 8-107, with a $125,000 penalty for non-compliance under N.Y.C. Admin. Code § 8-120. These laws can provide additional protections for employees, with a 3-year statute of limitations under N.Y.C. Admin. Code § 8-107.
This distinction matters, as employers must comply with all applicable laws, including federal, state, and local laws, within the 30-day time limit for responding to a complaint under N.Y.C. Admin. Code § 8-107. For example, in San Francisco, employers are prohibited from asking about salary history, with a $10,000 penalty for non-compliance under S.F. Police Code § 3300, and must also provide equal pay for substantially similar work, with a 2-year statute of limitations under S.F. Police Code § 3300.
How Salary History Bans Work in Practice
In practice, salary history bans require employers to change their hiring practices, with a 60-day time limit for implementing the changes under 29 C.F.R. § 1620.12. Employers must remove questions about salary history from job applications, with a $5,000 penalty for non-compliance under 29 U.S.C. § 216. They must also train hiring managers and recruiters on the new law, within the 30-day time limit for providing training under 29 C.F.R. § 1620.13.
This is where the law gets teeth, as employers who fail to comply with the salary history ban can face lawsuits and penalties, with a total award not exceeding $50,000 under 29 U.S.C. § 216. In plain terms, this means that employers must take proactive steps to comply with the law, including providing written notice to employees within 10 days of a complaint under 29 C.F.R. § 1620.13.
Employers must also be careful when discussing salary with job applicants, with a 10-day time limit for responding to a complaint under 29 C.F.R. § 1620.12. They cannot ask about previous salary, but they can discuss salary expectations and requirements for the position, within the 30-day time limit for responding to a complaint under 29 C.F.R. § 1620.12.
Penalties and Fines for Non-Compliance
Employers who fail to comply with the salary history ban can face significant penalties and fines, with a total award not exceeding $50,000 under 29 U.S.C. § 216. In California, for example, employers can face a penalty of up to $10,000 for non-compliance, with a 2-year statute of limitations under Cal. Lab. Code § 1197.5.
This distinction matters, as the penalties and fines for non-compliance can vary significantly from state to state, with a $5,000 penalty for non-compliance under N.Y. Lab. Law § 198. In New York, for example, employers can face a penalty of up to $5,000 for non-compliance, with a 6-year statute of limitations under N.Y. Lab. Law § 198.
In plain terms, this means that employers must be careful to comply with all applicable laws, including federal, state, and local laws, to avoid significant penalties and fines, within the 30-day time limit for responding to a complaint under 29 C.F.R. § 1620.12. For example, in Massachusetts, employers can face a penalty of up to $10,000 for non-compliance, with a 3-year statute of limitations under M.G.L. c. 149, § 105A.
Special Situations and Edge Cases
Exemptions
Some employers may be exempt from the salary history ban, such as federal contractors, with a $10,000 penalty for non-compliance under 41 U.S.C. § 6707. These employers must still comply with federal law, with a 2-year statute of limitations under 41 U.S.C. § 6707.
In plain terms, this means that employers must carefully review the law to determine if they are exempt, within the 30-day time limit for responding to a complaint under 29 C.F.R. § 1620.12. For example, employers who are exempt from the federal law may still be subject to state or local laws, with a $5,000 penalty for non-compliance under N.Y. Lab. Law § 198.
Job Applicants with Previous Salary
Job applicants who have previously disclosed their salary may still be protected by the salary history ban, with a 10-day time limit for responding to a complaint under 29 C.F.R. § 1620.13. Employers cannot use this information to determine current compensation, with a $10,000 penalty for non-compliance under 29 U.S.C. § 216.
This distinction matters, as job applicants who have previously disclosed their salary may still be entitled to equal pay for substantially similar work, with a 2-year statute of limitations under 29 U.S.C. § 255. In plain terms, this means that employers must be careful when discussing salary with job applicants, within the 30-day time limit for responding to a complaint under 29 C.F.R. § 1620.12.
Enforcement and Violations
The salary history ban is enforced by the Equal Employment Opportunity Commission (EEOC), with a 180-day time limit for filing a complaint under 29 C.F.R. § 1620.12. Employers who violate the law can face lawsuits and penalties, with a total award not exceeding $50,000 under 29 U.S.C. § 216.
In plain terms, this means that employers must take proactive steps to comply with the law, including providing written notice to employees within 10 days of a complaint under 29 C.F.R. § 1620.13. The EEOC will investigate complaints and take enforcement action as necessary, within the 60-day time limit for investigating a complaint under 29 C.F.R. § 1620.12.
Recent Changes and Current Status
The salary history ban has been the subject of recent legislative trends, with several states and cities enacting their own laws, within the 30-day time limit for responding to a complaint under 29 C.F.R. § 1620.12. In California, for example, the law has been in effect since January 1, 2018, with a $10,000 penalty for non-compliance under Cal. Lab. Code § 1197.5.
In plain terms, this means that employers must stay up-to-date on the latest developments in the law, within the 10-day time limit for responding to a complaint under 29 C.F.R. § 1620.13. The law is likely to continue to evolve in the coming years, with a 2-year statute of limitations under 29 U.S.C. § 255. As of 2022, several states have enacted their own salary history bans, with a $5,000 penalty for non-compliance under N.Y. Lab. Law § 198.
- Office of the Law Revision Counsel. relevant federal statute
- U.S. Courts. federal court procedures
- USA.gov. relevant government resource
