STOP Asking Employment Candidates about their Prior Salary
Author: Haley Paul
A recent survey by the Society for Human Resource Management found that approximately 62 percent of employers still ask candidates about their salary history. While the number of state-wide bans against asking candidates about their pay history is still relatively low, this issue is picking up traction and it is a good idea to change your company’s policies and practices now, instead of waiting for this to become an issue.
Some History on This Issue
In an effort to bridge the racial and gender wage gaps in the United States, a number of states and localities, such as California, Massachusetts, Oregon, and New York City, have passed legislation that bans questions about a job candidate’s wage history. The idea behind these laws is that women and minorities earn less on average than their white, male counterparts, so when an interviewer asks “What is your current salary?” in an attempt to gauge the appropriate compensation to offer the individual, it perpetuates the current wage disparity, as women and minorities would presumably be earning less at their current and prior jobs.
While a number of companies and politicians have been openly skeptical that these laws will be successful in narrowing the wage gap, the reality is that the number of state and local governments passing such laws is growing, with Hawaii passing Senate Bill 2351—prohibiting questions concerning the candidate’s current or prior wages or benefits and searches of public records or reports to obtain the same information—over the summer (the law will come into effect on January 1, 2019).
How Employers Should Respond
If you are a relatively small employer with employees in one location, it probably will not be difficult to keep track of whether these laws affect your business practices and so you may not be inclined to change your hiring practices yet. On the other hand, because of these new laws, it is probably only a matter of time before an employee files a race and/or sex-based discrimination charge with the EEOC on the basis of such questions, even in states and localities that do not have these laws. It is, therefore, a good idea to change your practices now to remove these questions from your job applications (and interview templates) and train your managers and other interviewers to avoid wage history questions. This is especially true if you have employees across several cities and states and no time to constantly track these laws.
So what should you do instead? You can give the candidate the salary range you are considering for the position at the beginning of the hiring process to assess whether it is something they will consider. You can also ask the candidate to provide a salary range of what they are hoping to obtain to be sure that you are not wasting your time on a candidate you cannot afford. You may then be able to decide, based on the given range (and your target range, if you’ve discussed it) what would be a fair offer. Finally, you can ask the candidate outright what amount of compensation they are seeking, although employers should keep in mind that studies have found that women tend to ask for less compensation than men, regardless of their experience level. If bridging the wage gap is a priority for you or your company, you should avoid this method, if possible, or at least keep it in mind in making your determination on what to offer.
If you want to begin changing your hiring practices to keep up with this area of changing law, but are unsure how or where to begin, contact Stibbs & Co. today and we will be happy to help you revise your current job applications and hiring procedures.