Earlier this month, Massachusetts enacted an equal pay law that, among other things, makes it the first state in the country to ban employers from asking about job applicants’ salary histories until they make a job offer. Now, New York City Public Advocate Letitia James wants to bring the same policy to her own city.
On Wednesday, James unveiled legislation that bars employers from asking about or conducting their own inquiries into a job applicant’s prior compensation. If an employer already had access to a candidate’s salary history, it would also be prohibited from using the information to determine the candidate’s pay.
“When employers rely on salary histories to determine compensation, they perpetuate the gender wage gap,” a summary of the bill states. “Adopting measures like this bill can reduce the likelihood that women will be prejudiced by prior salary levels and help break the cycle of gender pay inequity.”
“When employers rely on salary histories to determine compensation, they perpetuate the gender wage gap.”
Women are paid less than men at the start of their careers (a gap that has only increased in recent years) even when they have similar educations and backgrounds. That gap continues to follow them as they move from job to job — they are paid less in virtually every occupation — and even if they attain higher and higher degrees. The wage gap is far larger for women of color.
So if a new employer bases a woman’s salary off of what she was paid before, any prior wage discrimination gets baked in. It makes it difficult for women and/or people of color to close wage gaps over the course of their careers by negotiating for higher starting salaries.
James’s legislation comes after she released a report earlier in the year finding that college-educated women in New York City make 20 percent less than men, and women overall earn about $5.8 billion less each year. Women of color are penalized even more, with a 54 percent wage gap for Hispanic women, a 45 percent gap for black women, and a 37 percent gap for Asian women. At the time, James proposed creating more salary transparency and flexible work arrangements in addition to floating the ban on inquiring about salary history.
New York State lawmakers have already passed legislation aimed at closing the state’s wage gap, which currently means women make 87 cents for every dollar men earn. They banned salary secrecy so that employees are free to discuss pay, improved existing prohibitions on paying men and women differently, and increased penalties for breaking equal pay laws.