In July of this year, the Kansas City (Missouri) Council reached a unanimous vote to ban the salary history question from city job applications. According to KCTV News Channel 5, this change happened after numerous women’s groups petitioned the city to stop collecting salary history on applications in an effort to combat gender wage gap issues.
For now, this ban only affects city jobs in KC, but as you’ll see, many states have followed suit and phased out these dated inquiries, and it is becoming increasingly clear that employers must adapt. Below we break down what you need to know and how it might affect hiring procedures.
We’ve all seen the statistics, and yet they continue to alarm. Asian women earn 90 cents on the dollar, white women 81 cents, black women 65 cents, and Hispanic women only 58 cents on the dollar in comparison to white men, according to a report from the Institute for Research on Labor and Employment (IRLE). To help combat this perpetual wage gap issue that works against gender and people of color, a handful of cities and states are opting to remove any mention of salary history to help ensure an even playing field from the beginning. As the IRLE states, this change would “reduce the likelihood that women would have to negotiate from a lower starting point than male counterparts…banning the question makes it possible for women to enter into negotiations on level footing with men.”
While no federal law has yet been enacted, changes are taking shape at the city and state level. Since 2016, various forms of bans have been passed in New York, New Jersey, Philadelphia, Delaware, Vermont, Massachusetts, Chicago, Pittsburgh, Oregon, California, Puerto Rico, Wisconsin, Michigan, and more. With Kansas City joining the ranks in the public sector, more are sure to follow.
How to react
For employers, the salary question has been a determining factor to understand the market rate for various roles and applicants. However, organizations everywhere should be prepared to adjust to a working world where salary history questions are phased out.
There are other ways to approach salary when hiring, in fact. One such way is to have clear discussions with potential employees that address pay expectations. These types of conversations will open the door for transparent dialogue about the position and pay without the need for the potentially discriminatory history data. As Glassdoor states, “Before the first interview, hiring managers should work with their HR and recruiting teams to determine the value of the role, get very clear on what will drive a higher or lower compensation package (i.e. specific skills, management experience, etc.) and base interview questions around those topics.”
And this is just one way to approach progressive hiring methods. With employment laws like these changing frequently, you must stay ahead of it all. People People would love to help. We specialize in HR so small business owners don’t have to, and we offer expertise about a broad range of HR concerns. We can help with the tough questions and can guide you through all changes. Reach out to People People today.