In October 2017, New York City made it illegal for private and public employers to ask about a job applicant’s salary history. Employers can’t ask about other benefits or compensation a job applicant received either and includes questions directly asked by the employer or the employer’s employees, like a human resources representative.
Employers can speak with applicants about what they expect their salary to be, along with desired benefits. If an employee voluntarily, without prompting, informs their potential employer of their salary history, the potential employer is permitted to consider the salary in determining the salary and benefits of the new applicant. The employer can also take steps to verify the salary history shared by the applicant.
The NYC law does not apply where an employee is being considered for an internal transfer or promotion. Where an employer is conducting a non-salary background check and discovers a past salary, that’s okay under the law, but the employer can’t rely on that information to determine whether or not to hire an applicant or determine what salary to offer the applicant. Employers are permitted to ask about the salaries of public employees whose salaries are determined by a union contract. If any other local, state, or federal law requires the employer to track the salary history of their employees, then employers can ask for such information.
In January 2020, New York State adopted almost the same law by amending the New York Labor Law. Section 194-a of the New York Labor Law prohibits employers from asking questions on a job applicant’s salary history at any point during the hiring process. This includes asking questions, whether orally or in writing, of the applicant and of their former employer. If employers get salary information some other way, they cannot rely on it in deciding whether or not to offer employment to an applicant.
Unlike the New York City Law, the New York State law restricts employers from using salary history as a factor in decisions on internal promotions as well. However, like the city law, the state law exempts employers who are told the salary history directly by the applicant voluntarily or employers who are tracking salaries in pursuit to a local, state, or federal law. Employees whose rights are violated under this statute can file a complaint with the Department of Labor.