Halloween promises to be extra spooky for employers who are not up to speed on the latest step New York City has taken to close the gender wage gap. Beginning October 31, 2017, the questions employers are permitted to ask prospective job candidates will change considerably.
In a big step toward dismantling barriers to pay equity, in May of 2017, Mayor de Blasio signed legislation prohibiting all employers in New York City from inquiring about, relying upon, and verifying a job applicant’s salary history. The law, Section 8-107(25) of the NYC Administrative Code, brings private employers in New York City in line with city agencies, which have been barred from inquiring about prior salary histories in hiring since the Mayor’s executive order in November of 2016. With this latest action, New York City joins Oregon, Delaware, California, Massachusetts, Puerto Rico, Philadelphia, and San Francisco in taking actions to close the gender wage gap by reducing the likelihood that women will be prejudiced by prior salary levels.
Once enacted, if an employer in New York City asks an applicant about her prior salary, the employer will be engaging in prohibited discriminatory conduct. Employers may not ask and must refrain from relying on prior salary to determine “the salary, benefits or other compensation for [an] applicant during the hiring process, including the negotiation of a contract.” Employers are additionally prohibited from seeking salary history through alternative means, such as the searching of public records or asking a previous employer. However, this bill does not prohibit applicants from voluntarily disclosing prior salary history – but, a word of caution, if one chooses to disclose salary history, an employer may rely on it in determining salary and benefits.
This law contains certain important exceptions. For instance, disclosure is permitted if employers are acting pursuant to any federal, state, or local law that authorizes the disclosure or verification of salary history, or when an applicant internally transfers or seeks promotion with her current employer. The law does not apply to public employees whose salaries are determined by collective bargaining agreements. Nor does it prohibit an employer from verifying non-salary information or conducting a background check, so long as salary history, if discovered, is not used to inform the hiring or contracting process. Lastly, employers are allowed to ask about objective markers of performance, such as revenue or sales reports.
By asking for a job candidate’s salary history, employers feel inclined and justified to continue paying women relative to the amount they were earning at their former job – which is often lower than their similarly situated male counterparts – directly contributing to the persistence of the wage gap. Differences in salary between men and women can be attributed to a number of factors, including the archaic belief that a woman’s salary is merely supplemental to her husband’s who is the primary source of income; stereotypical beliefs that women take their work less seriously because of purported childcare responsibilities; and segregation by job industry and rank. Perhaps the biggest factor that hurts women’s pay relative to men’s – based on when the pay gap widens most sharply – is when women have children.
To achieve greater pay equality, social scientists say changes in the workplace and in public policy need to be gender neutral, i.e. applicable to both men and women. For example, companies should put less priority on working long hours and having face time in the workplace, as research shows the main reason for wage gaps at work — why women are paid less, are less likely to reach the top levels of companies, and are more likely to stop working after having children — is employers’ expectation that employees spend long hours at their desks. This expectation has a greater negative effect on women because they still take on disproportionate responsibilities for caregiving. In terms of public policy, the government should provide subsidized child care and adequate parental leave, like that provided in New York State starting January 1, 2018.
Stopping the harmful practice of basing a new salary off prior a one ensures that discriminatory pay practices are not perpetuated for the duration of an employee’s career. This legislation, as well as the Executive Order that proceeded it, was initiated and supported by New York City Public Advocate, Letitia James’ Policy Report regarding pay equity and the gender wage gap. The Public Advocate’s report, issued in April of 2016, proposes policy changes as a catalyst to eliminate the gender wage gap. Her recommendations include promoting family-friendly workplace policies, such as flexible work schedules and creating an “Equitable Pay and Opportunity Task Force” to collect and analyze pay and promotion data and conduct a search for the root causes of pay and employment inequity for women in municipal government.
Despite efforts to address this issue, the wage gap still persists among New York State New York City government employees, where the gender wage gap is 17% and 18%, respectively. Although NYC’s municipal government uses a fixed pay scale, female employees still end up being paid less because women are frequently placed in lower paying positions and are tracked into agencies that yield less influence. While it is the case that women earn significantly less than their male counterparts, this disparity is not experienced by all women equally. In the U.S., white women make roughly 79 percent of white men’s annual earnings, while black women make only 63 percent of white men’s annual earnings. In New York City – one of the most racially diverse places in the world – the wage difference among women is not as stark as it is in other places around the country, but white women still fair better than women of color. For instance, while white women and black women make $41,670 and $40,751 per year, respectively, Latina women make a staggering $33,985, compared to a white man’s salary of $54,297.
With these disparities in mind, members of the NYC Council introduced Resolution No. 1273, which urges the governor and the NY state legislature to pass similar salary history ban legislation, introduced both in 2015 and 2016, at the state level. This resolution is still in the committee process.
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