On October 12, 2017, Governor Brown signed Assembly Bill 168. Consistent with some other state laws and local ordinances passed by certain municipalities like San Francisco, the new law prohibits the inquiry and use of prior salary information except in limited situations. The new law will be contained in Labor Code section 432.3 and becomes effective January 1, 2018.
The new law:
- Prohibits an employer from relying on the salary history information of an applicant for employment as a factor in determining whether to offer an applicant employment or what salary to offer an applicant.
- Prohibits an employer from seeking salary history information about an applicant for employment.
- Requires an employer, upon reasonable request, to provide the pay scale for a position to an applicant for employment.
The new law does not prohibit:
- An applicant from voluntarily (without prompting) disclosing salary history information.
- An employer from considering or relying on voluntarily disclosed salary history information in determining salary, as specified.
The law applies to all employers, including state and local government employers and the Legislature. However, it does not apply to salary history information disclosable to the public pursuant to federal or state law.
California employers should do the following before the January 1, 2018 effective date:
- Review and update all employment application and hiring materials to ensure there are no questions requiring an applicant to disclose prior salary information.
- Train all managers, supervisors, human resources, and other individuals involved in the recruitment and hiring process to ensure they are aware of the requirements under the new law.
- Take other reasonable steps (e.g. periodic audits of hiring and payroll practices) to ensure that they are in compliance with this law and the California Equal Pay Act which requires equal pay for substantially similar work performed by employees of different genders, races, or ethnicities.
The Labor & Employment attorneys at Weintraub Tobin have extensive experience counseling and defending employers in all areas of employment law and are happy to assist employers in auditing their hiring and payroll practices to ensure compliance with California law. Please feel free to contact partner, Beth West, or any of the other Labor & Employment attorneys.