Salary Questions a Business Can Ask During Job Interviews
SUMMARY: California’s Equal Pay Act, Labor Code section 1197.5, prohibits employers from paying less than the rates paid to employees of the opposite sex for substantially similar work. Some exceptions, such as seniority, apply. That statute prohibits an employer from using “prior salary” to justify wage disparity. These apply to disparities in wages paid to workers based on race or ethnicity. Thus, a potential employee’s prior salary is irrelevant when determining what to pay that person. Moreover, a question regarding an employee’s prior salary invites concerns that the business intends to preserve salary disparities based on gender or race. A new statute, effective this year, permits a business to determine salaries for current employees based on the person’s [PRIOR?] salary, as long as the decision complies with the rest of the statute. In addition, a current employee who applies for a different position in the same company is not a job “applicant” under the Equal Pay Act.
TAKEAWAYS: Employers may wish to train their human resources professionals, and all employees responsible for interviewing job candidates and setting salaries, about these changes. They may also wish to audit their payroll for unpermitted differences in pay.
Please contact Phillip Maltin for further information about these changes to California law.