Unlawful Employment Practices: Is Your Company Ready for the Change?
November 29, 2017
By: Brad Stanke
States like California, Oregon, Massachusetts, and Delaware have recently introduced new legislation to account for the wage gap between protected classes. Even major cities like San Francisco, New York, Pittsburgh, and New Orleans have adopted policies that forbid salary history inquires. It’s little doubt that more states will introduce their own legislation, but what do these measures mean for hiring professionals? How does this legislation change the way companies bring on new talent? Let’s crack open a few questions to get a big-picture view of one of today’s most prevalent workplace controversies.
What is the pay gap?
The pay gap is the average difference between a man’s remuneration (pay/salary) versus a women’s remuneration. This gap widens further when accounting for inflation, pay increases, and advancement opportunities. What’s more, these gaps grow far wider when they involve men and women who are ethnic minorities.
How do new laws address pay gaps?
Now that the national spotlight has underscored this issue, legislators are taking steps to diminish pay gaps. First, certain laws limit a hiring professional’s ability to seek and rely on an applicant’s salary and benefits history. Additional provisions ensure that hiring professionals provide a pay scale for the position when requested by the applicant.
Do pay gap laws affect recruiters and hiring agents?
Where it’s become law, pay gap legislation forbids hiring professionals from relying on an applicant’s salary and benefit history when considering employment or making a salary offer. It also means that hiring agents can’t go looking for this information, either from the applicant or from an agent. So, if a hiring professional from another company reaches out to you about a past employee’s pay and benefits scale, this is not information you can offer, either. However, applicants can volunteer this information if they choose, and if this happens, hiring professionals can certainly take this information into account.
What’s the takeaway? Since major cities and entire states have adopted the policy of not asking or considering salary history when hiring for a new role, hiring professionals on the whole should likely adopt this policy, too. After all, many candidates come from areas where these laws are already observed.
What are the advantages and disadvantages of pay gap legislation?
Here’s the ideal benefit: pay gap legislation could help close the divide between men, women, and minorities’ salaries. Plus, if recruiters take a more active role in shifting these practices, they can be the ones on the cutting edge of this evolution when it goes nationwide.
The downside? For many, it will be a challenge to recalibrate hiring negotiations and salary talks. Some believe that legislating this controversial issue is an example of government overreach, and that these new laws won’t impact the wage gap in a meaningful way.
Whatever you believe about this issue, discussions on the pay gap and related legislation aren’t going away any time soon. Arm yourself with information now as this topic continues to develop nationwide, and you’ll be poised and well-equipped—no matter the outcome.