If an employer violates the salary history ban, the applicant/employee may either file a complaint with the Department of Labor and Industries or file a civil suit.
Washington recently enacted House Bill 1696, which amends the Equal Pay and Opportunities Act to prohibit employers from inquiring about an applicant’s salary history. Governor Jay Inslee signed the bill on May 9, 2019, and it will go into effect on July 28, 2019. Washington will then join the rapidly growing number of states and municipalities with so-called salary history bans.
The salary history ban is one of two new laws that will have a broad impact on the way that Washington employers hire and onboard new employees. The second, House Bill 1450, imposes restrictions on postemployment noncompetition agreements, and will be effective on January 1, 2020. You can read more about Washington’s new restrictions on noncompetition agreements in our June 3 Alert.
Salary History Ban
House Bill 1696 prohibits all employers from (1) seeking the wage or salary history of an applicant for employment, either directly from the applicant or from a current or former employer, and (2) requiring that an applicant’s prior wage or salary history meet certain criteria. Although the law permits employers to confirm an applicant’s wage or salary history, an employer may only do so if the applicant has voluntarily disclosed his or her wage or salary history or if the employer has already negotiated and made an offer of employment to the applicant that includes an offer of compensation. The law does not expressly contain restrictions on how an employer may use salary history information that is voluntarily disclosed by an applicant, nor does the law define what constitutes a voluntary disclosure.
House Bill 1696 also requires employers with 15 or more employees to provide, upon request by an applicant who has been offered a position, the minimum wage or salary for the position. This requirement also applies to internal transfers and promotions. If no wage scale or salary range exists, the employer must provide the minimum wage or salary expectation set by the employer prior to either posting the position, making a position transfer or making the promotion.
If an employer violates the salary history ban, the applicant/employee may either file a complaint with the Department of Labor and Industries or file a civil suit. An aggrieved individual may recover the greater of lost wages or $5,000 in statutory damages as well as attorneys’ fees. The Department of Labor and Industries may also assess civil penalties.
What This Means for Employers
Washington employers may no longer ask applicants about their wage or salary history. As a reminder, under a “ban the box” law that went into effect in June 2018, Washington also generally prohibits employers from, among other things, inquiring about an applicant’s criminal history unless the employer has already determined that the applicant is otherwise qualified for the position.
Employers who rely on applicants’ salary or wage history when evaluating applicants for employment or determining compensation will need to revisit their approach in this regard. Employers should also be prepared to provide minimum wage or salary information to applicants, as well as wage scale or salary range information (where established) to existing employees offered a transfer or promotion. To minimize the risk of noncompliance, before the new restrictions go into effect, employers should review their application forms and interview processes, train employees who interview, hire, promote or determine compensation regarding the law’s requirements, and confirm that third-party recruiters are aware of and commit to complying with the law’s restrictions.
For Further Information
If you have any questions about this Alert, please contact Christopher D. Durham, Jonathan A. Segal, Elizabeth Mincer, any of the attorneys in our Employment, Labor, Benefits and Immigration Practice Group or the attorney in the firm with whom you are regularly in contact.
Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.