Stop Asking About Salary Histories
Much has been made recently about “ban the box” legislation, which prohibits potential employers from asking about a person’s criminal history on job applications. Employers can still make an inquiry, but only in later stages of the job application process when a person can explain the situation rather than being reduced to a check mark in a box. Currently 26 states (including Kentucky) and over 150 cities have some form of this policy in place.
Getting rid of salary history questions
“How much did you make at your last job?” It’s a frustrating and irrelevant question posed to many when they are interviewing for a new position.
It is common advice to not let your potential employer know your last salary. From a strict negotiating standpoint, you lose most of your leverage, making any increase in pay you receive seem fair or even generous. Sidestepping the question with a response stating what you are expecting to make in the new job is suggested.
But this advice has its limits. When filling out an application online, the answer may be required without the ability to navigate around it. You can’t always negotiate your way past a computer program. And many applicants feel if they aren’t totally honest and forthcoming in the interview they will not be considered, creating a great deal of pressure to answer.
However, this question is not just frustrating. In many cases, it can be detrimental to potential candidates, especially women and minority candidates. This, along with recent public discourse regarding the stubbornly persistent wage gap, has brought a new policy to the forefront.
Many cities and states across the country have begun prohibiting employers from asking about the salary histories of candidates for a job. In these places, a candidate’s past salary cannot be required for consideration for a new position. In addition, many of these areas are requiring that salaries, minimum salaries, or salary ranges for individual positions be predetermined and made known to candidates.
The goal with this policy is that people, regardless of gender, race, or previous salary level, will be able to start a new position under fairer circumstances.
Why does this matter?
Moving to a new job can be the best way for someone to improve their income. However, because new salaries are often based on previous salaries, those who have started their careers in lower paying positions can get locked into a lower pay scale for years. Starting out with a lower base pay can in turn affect any future bonuses, raises, and promotions a person may receive.
This is often true for women and minorities, who are more likely to have lower paying positions or to be paid less for doing the same work. This, according to some experts, is a major contributing factor to gender and racial pay gaps.
However, this policy is also beneficial to young people in general, regardless of race or gender. Despite being the most educated generation in history, Millennials are no better off (and are perhaps worse off) than past generations. Young people, even with education and experience, are often forced to take low paying jobs to make ends meet, trapping them on a career path where they are underpaid or underemployed. These lower starting salaries can mean less money for an entire generation for decades to come.
Having a low paying job now should not lock you into being underpaid for the rest of your working life. Whether a person continues to be underpaid in a new position due to the economy, the biases of a potential employer, or simply due to a continuation of the biases of past employers, the result is the same. Prohibiting questions about past salaries “ensures that employers pay employees for their new job, not their old one.”
This is also good policy for employers. Ignoring candidates based on their previous levels of pay can filter out good applicants, as they may incorrectly assume that someone with a lower salary is a lower qualified candidate. Prior salaries do not reflect current qualifications. In addition, paying employees fairly can improve overall morale and workplace loyalty.
The idea is spreading quickly
This is a relatively new policy, but jurisdictions across the country are moving quickly to adopt it.
- The first government to take up this policy was Massachusetts, which passed a law in August of 2016 which makes asking about a candidate’s salary history illegal. The law goes into effect next year. The law received bipartisan support and passed both houses of the state legislature unanimously. It was signed into law by the state’s Republican governor and supported by the Boston Chamber of Commerce.
- The state of New York announced in January that it would no longer ask about past salary history for state jobs.
- In January, the city of Philadelphia became the first city to prohibit employers, public or private, from considering past salaries. As in Massachusetts, the law passed unanimously in the city council (16-0). It will take effect in May.
- Also in January, Pittsburgh and New Orleans will no longer ask about past salaries for city jobs.
- New York City prohibited city agencies from asking last November. Just this month, the city council expanded this to include public and private employers. The law passed with a 47-3 vote.
- Last month, Puerto Rico passed a law banning questions about salary history.
Still other areas have either attempted to pass similar laws or have legislation pending. The states of Texas, Illinois, Connecticut, Colorado, Virginia, Washington, New Jersey, California, and Maryland have all introduced legislation that would prohibit questions regarding a candidate’s past salary. Several of these bills are likely to pass this year. Washington D.C. has also taken up the issue. At the federal level, a bill was introduced that would prevent employers nationwide from asking about past salaries.
There is, however, one concern with this policy. Because it is so new and in many cases has not even been implemented yet, it is hard to know exactly what the results will be. This is the case with most new policies. However, some critics have looked at some of the unintended consequences of “ban the box” legislation to see how banning salary history may turn out.
One recent study found that, rather than improving chances, banning questions about a job candidate’s criminal record may make certain minority groups less likely to be hired. They concluded that without the box to be certain, many employers would just assume that some people (mainly black and Hispanic males) had a criminal record. The concern then is that employers’ biases are strong enough to outweigh any potential policy benefits. Even without racially biased policies, you still must deal with racially biased hiring practices.
Some fear that banning questions about salary history may have the same unintended consequence. Without knowing for sure what a person made in their last job, employers may simply assume that women, minorities, or young people made less than they actually did.
Another part of this concern deals with an aspect of many of these laws. While employers cannot ask about past salaries, candidates are often free to bring it up themselves. This raises the possibility that employers will take a candidate’s silence on the issue as a sign of a low salary. After all, if you made a lot of money at your last job, why not bring that up?
However, while discrimination in hiring practices is a legitimate issue, it is not an excuse to ignore more systematic sources of bias. In addition, many of these policies require employers to have a salary or salary range predetermined, making it harder for biases to have any effect. If a position is listed as paying $45,000, it will pay that regardless of the candidate.
We Can Do This
This policy has only recently been addressed. Massachusetts, the first government to adopt the policy, only did so last August. New York City did just this month. It is promising to see so many governments take up the issue so quickly. Louisville and Kentucky have the opportunity to be out in front on this issue. We can make hiring and salary decisions more fair. We should prohibit past salaries from being considered for new hires.
Working for low pay once should not mean you must work for low pay forever.Working for low pay once should not mean you must work for low pay forever. Click To Tweet
About the Author
Neal Turpin is a PhD candidate at the University of Louisville’s School of Urban and Public Affairs, where he is focusing of public policy and participation, democratic structures, and efficiency. He enjoys spending time with his wife, Sara, working out at the Southeast YMCA, where the two of them met, and teaching Sunday school at Buechel Park Baptist Church. Neal also has an appreciation for trivia, movie scores, and the Muppets.