Mayor Jim Kenney is expected to sign the bill into law, which would make it an unlawful employment practice for covered employers to ask job applicants about prior pay.
On December 8, the Philadelphia City Council unanimously passed an ordinance that amends the Philadelphia Fair Practices Ordinance to prohibit all Philadelphia employers[1] from asking prospective employees about their wage history. Philadelphia joins a growing number of states and local jurisdictions that have passed similar legislation, including California, Massachusetts, and New York City (which issued an Executive Order prohibiting city agencies from making such inquiries). Other states and local jurisdictions considering such legislation include New Jersey, Pennsylvania, New York City (a proposal applicable to private employers) and Washington, DC.
Under the ordinance, it is an unlawful employment practice for an employer or employment agency to inquire about a prospective employee’s wage history, require that a prospective employee disclose wage history, condition employment or consideration for an interview or employment on disclosure of wage history, or retaliate against a prospective employee for failing to provide wage history information. Additionally, it is an unlawful employment practice for an employer to rely on a prospective employee’s wage history in determining that individual’s wages at any stage of the employment process, unless the applicant knowingly and willfully disclosed the information.
The preamble to the ordinance sets forth the city council’s findings that lead to passage of the ordinance, including the council’s views that “women are paid on average lower wages than men,” “basing wages upon a worker’s wage at a previous job only serves to perpetuate gender wage inequalities,” and “[s]alary offers should be based upon the job responsibilities of the position sought and not based upon the prior wages earned by the applicant.” The preamble also recognizes that Massachusetts was the first state to pass similar legislation prohibiting employers from seeking or requiring a prospective employee’s wage history. (For more information on the Massachusetts Equal Pay Act, read our LawFlash—Massachusetts Enacts Sweeping Equal Pay Law).
The Philadelphia Commission on Human Relations is tasked with enforcing the ordinance and may do so through issuing cease and desist orders, ordering injunctive relief, and requiring payment of compensatory and punitive damages and attorney fees. Also, individuals may bring private causes of action for violations of the ordinance if the Philadelphia Commission on Human Relations dismisses their complaint or fails to address it within one year after they file it.
The ordinance takes effect 120 days from the date it is enacted into law. Mayor Jim Kenney has indicated publicly that he supports the ordinance, which currently is awaiting his signature.
In light of the ordinance, Philadelphia employers should revise existing handbooks, policies, and trainings to prohibit inquiries into wage history during interviews and the use of prior salary to set pay and also should ensure that any recruiting agencies they use do not inquire about wage history. In addition, employers should keep track of other factors that determine initial pay, including relevant prior work experience, education, and pay for incumbents in the same or substantially similar positions and should also document the specific reasons that motivated individual initial pay decisions.
If you have any questions or would like more information on the issues discussed in this LawFlash, please contact any of the following Morgan Lewis lawyers:
Philadelphia
Michael S. Burkhardt
W. John Lee
[1] “Employer” is defined as “[a]ny person who does business in the City of Philadelphia through employees or who employs one or more employees exclusive of parents, spouse, Life Partner or children, including any public agency or authority; any agency, authority or other instrumentality of the Commonwealth; and the City, its departments, boards and commissions.”