Key  Takeaways:

• The state law applies equally to applicants, potential employees, and current employees who are seeking a promotion or transfer

• Workers have the right  to volunteer information about their salary history as long as the disclosure is without soliciting, prompting, or encouragement by the employer

• New York City employers should be mindful to read the city law in conjunction with the state law

In an effort to shrink the gender wage gap, New York joined Alabama, California, New Jersey, and Washington in effecting a salary history ban. New York enacted the law in early July 2019, and it went into effect last week.

As more fully explained in a previous article, the law prohibits all size employers, public or private, from inquiring into the compensation or benefits history of an applicant, potential employee, or a current employee who is a candidate for a promotion or transfer. This includes part-time, seasonal and temporary workers, regardless of their immigration status. The law does not apply to bona fide independent contractors, freelance workers, or other contract workers unless they are to work through an employment agency.

The state has also issued guidance in order to help employers understand and comply with the obligations under this law and to advise applicants and employees of their rights. The guidance makes clear that:

• The law applies in any instance in which the worker’s job will be based in New York State and that the location of the interview does not control
• Employers have the right to ask about a worker’s salary requirements or salary expectations
• Employers have the right to consider information already in their possession for existing employees (e.g., the current employee’s current salary or benefits being paid by that employer) as part of the decision-making process for employees seeking a promotion or transfer
• Workers have the right to volunteer information about their past compensation as long as the disclosure is without soliciting, prompting, or encouragement by the employer
• Employers have the right to confirm salary history only if an applicant voluntarily discloses such information without soliciting, prompting, or encouragement by the employer
• The law provides protections against retaliation
• Applicants and employees have the right to bring a private cause of action

To ensure compliance, the guidance encourages all employers to review their job applications and related processes to eliminate any questions seeking an applicant’s current or past salary, and to train hiring personnel on the requirements of New York Labor Law 194-a.

New York City has had a salary history ban in place since October 2017. The two laws are very similar with a few notable distinctions. New York City employers must read the city law in conjunction with the state law in order to determine which one controls.

On these issues:

• The city law applies only to applicants and does not extend to current employees (g., employees seeking promotions or transfers), but the state law is more expansive and extends to applicants and current employees seeking promotions and transfers
• The city law allowed employers to ask candidates about deferred compensation or unvested equity that an applicant would forego in taking a new job, but the state law broadly prohibits employers from seeking any information about compensation
• The city law permits employers to ask about the value of any counteroffers, but the state law prohibits such inquiries.

However, the state law does not apply to bona fide independent contractors, freelance workers, or other contract workers unless they are to work through an employment agency. The city law extends to all workers. Thus, on this issue, the more expansive city law controls and New York City employers must comply with the city law.

If you have any questions about this law or how it affects your business, please contact:

• Cali L. Chandiramani
• Scott R. Green
• Caroline J. Berdzik
• Peter J. Woo
• Kristin Klein Wheaton
• Or another member of the Employment and Labor practice