The New York City Commission on Human Rights’ new publications clarify legislation prohibiting employers from asking New York City job applicants about their past compensation and benefits.
The New York City Commission on Human Rights (NYCCHR) has issued frequently asked questions (FAQs) and fact sheets for both job applicants and employers setting forth its interpretation of the new law amending the New York City Human Rights Law that bans inquiries into a job applicant’s salary history. The new law will go into effect October 31, 2017. The FAQs and job applicant and employer fact sheets provide additional information for both employers and applicants and list “best practices” for the hiring process.
As described in Morgan Lewis’s previous LawFlash, the ban prohibits employers from inquiring about applicants’ past compensation, including salary, bonuses, and benefits. It further bars employers from conducting searches of public records for the purpose of obtaining salary history, and makes it illegal to rely on salary history in determining what salary and/or benefits to offer applicants. If an applicant “voluntarily and without prompting” discloses his or her previous compensation, however, the employer may confirm and use that information in determining compensation.
The FAQs and fact sheets provide the following new guidance and recommendations on the ban:
Note, however, that the statute does not contain an express exemption regarding deferred compensation, and NYCCHR’s position on this issue might not be the final word. A more cautious approach for employers would be to initially inquire only into whether an applicant expects to forfeit any deferred compensation. If the applicant indicates that he or she expects to be “made whole” for any deferred compensation being forfeited, the employer can ask for proof of that.
Employers should train every employee involved in the hiring process regarding compliance with this law; ensure that all employment applications and other documents provided to prospective employees during the application process are made compliant; ensure that policies and procedures are in place to properly document the exchange of relevant information with job candidates; and ensure that the risk of liability for recruiter violations is properly allocated. The new law also highlights the need for employers to conduct regular, privileged pay equity audits.
Morgan Lewis will provide further guidance as the new law continues to be interpreted.
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: