What You Need to Know About California's Ban on Salary History Inquiries

Feb 20, 2018

In October 2017, Governor Jerry Brown signed A.B. 168, which added a section to California's labor code banning employers from asking about past salary. The new law, codified in section 432.5 of the Labor Code, took effect on January 1, 2018.

The goal of this law is to help address the wage gap, or the pay disparity between men and women in substantially similar jobs. California has joined a growing number of states in banning companies from asking about past salary on the theory that this perpetuates wage discrimination because women and minorities have historically been underpaid. When salary negotiations are based on past wages that were lower than the wages should have been because of systemic discrimination, low wages will follow a worker from job to job.

The law did more than just prevent employers from asking about past salary. The law:

  • Prohibits employers from relying upon salary history as a factor in setting terms of employment. Employers cannot consider salary history when deciding whether to hire a worker or what to pay a worker. The only exceptions are when the information on salary is publicly disclosable or if the employee volunteers the information willingly.
  • Prohibits employers from attempting to obtain salary information about job applicants. Employers may neither ask a job applicant for salary history nor attempt to find out this information by using an agent. Employers are not allowed to seek salary history either by asking questions aloud or through written requests for information.
  • Requires employers to provide a pay scale to applicants if a reasonable request is made. There is no specific guidance contained within the law regarding what a reasonable request would be or what, specifically, constitutes a pay scale for a given position.

Our professionals provide guidance with all aspects of the hiring process, including presenting qualified candidates whose compensation expectation match the pay range. It is important to remember you can discuss compensation with candidates as long as they volunteer this information. It is also ok to discuss salary expectations. Celeritas represents companies and candidates who understand the importance of matching compensation expectation with the open position from the beginning.