United States: New Jersey Adds To Recent Flood Of Salary History Ban Laws

Last Updated: August 1 2019
Article by William Simmons

Continuing the recent deluge of salary history ban laws,1 on July 25, 2019, New Jersey Lieutenant Governor Sheila Oliver signed Bill A1094 into law.2 Like other recent laws limiting salary history inquiries, New Jersey's law prohibits employers from screening job applicants based on the applicant's prior salary history, which includes prior wages, salary or benefits. In addition, employers may not require that an applicant's salary history satisfy any minimum or maximum threshold to be considered for a job. The new law takes effect on January 1, 2020.

The law provides for a private right of action as well as civil penalties from $1,000-$10,000 per violation depending on the circumstances. The law does not expressly define what conduct will be considered as a single "violation" for purposes of calculating penalties.

Fortunately for employers, New Jersey's law contains examples of expressly permitted activities and exceptions from coverage in certain key areas:

  • Employment Application: If an employer has a multi-state employment application that includes operations outside of New Jersey, the employer is allowed to have a salary history question with a disclaimer that an applicant for a position located in whole or in substantial part in New Jersey is instructed not to answer the question.
  • Voluntary Disclosure: If an applicant voluntarily discloses (defined as without prompting or coercion) his or her salary history, the employer may both: (1) verify that the information the applicant provided was accurate and (2) use the information to determine the applicant's compensation.
  • Post-Offer Verification: An employer may obtain written authorization from the applicant to confirm salary history after an offer of employment that contains an explanation of the offered "overall compensation package."
  • Internal Transfers or Promotions: The law does not apply to applications for internal transfer or promotion.
  • Background Checks: If an employer informs its background check vendor that salary history information is not to be disclosed to the employer, but for some reason the background check includes a disclosure, the disclosure will not violate the law. However, the employer will have to destroy the salary history information and not use it.
  • Incentive and Commission Plans: Employers are allowed to discuss the "terms and conditions" of incentive and compensation plans the applicant was subject to at a prior employer, provided that: (1) the employer does not ask about the specific dollar amounts involved in the plans and (2) the job the applicant applied for with the prospective employer includes an incentive or commission component.3

New Jersey's law also contains perhaps the most nuanced approach to employment agencies compared to similar salary history laws. The law provides that (a) applicants may disclose salary history information and information regarding the applicant's experience with incentive and commission plans to employment agencies the applicant is using to search for work and (b) the employment agency may provide that information to employers as long as it has the applicant's express written consent. Employers will have to await further guidance as to how courts and the N.J. Commission of Labor and Workforce Development will interpret the specifics of this provision given the overarching prohibition on employers' using salary history information to screen applicants otherwise.

Finally, unlike some recent laws and ordinances, New Jersey's law does not require that the employer affirmatively disclose a wage scale for applicants.4

Next Steps

  • Employers with operations in New Jersey or other affected salary history ban states should consider evaluating the contents of job applications, interview guidelines or templates, recruiter instructions and background check vendor instructions to ensure that no impermissible salary history inquiries or screening is conducted.
  • Employers with operations in multiple states should consider forming a working group to assess business needs with respect to applicant wage data and the best multi-state or "50-state" approach to salary history inquiries and use given those needs. As New Jersey's law demonstrates, there is no "template" or "model" law adopted for salary history bans, as every law is unique in its coverage, prohibitions and exemptions.
  • Employers may want to consider appointing an employee with subject matter experience on this issue (or consulting employment counsel) to remain up-to-date on salary history ban laws as well as the full array of state and local laws impacting hiring compliance, such as the Fair Credit Reporting Act, ban-the-box laws and fair chance acts, credit check bans, social media inquiry prohibitions, revamped pay equity laws, and others.

Footnotes

1 See, e.g., Jean L. Schmidt and Sean A. Malley, New York Expands Pay Equity Law Beyond Equal Work and Gender and Bans Inquiries into Salary History, Littler ASAP (July 11, 2019); Katherine Suttle Weinert, Alabama Enacts Pay Equity Law, Littler ASAP (June 13, 2019); Alexandra Hemenway and Dylan Long, Kansas City, Missouri Joins National Movement to Ban Salary History Inquiries, Littler ASAP (May 31, 2019); Breanne Martell and Alexandra Hemenway, Washington Amends its Equal Pay Law to Enact Salary History Ban and Require Disclosure of Salary Ranges, Littler ASAP (May 16, 2019); Jennifer Harpole, Colorado Legislature Passes Significant Equal Pay Bill, Including Salary History Ban and Job Posting Requirements, Littler ASAP (May 8, 2019); Toledo, Ohio Ordinance O-173-19.

2 Lt. Gov. Oliver is serving as New Jersey Acting Governor while Governor Phil Murphy is on vacation.

3 The law also exempts any employer actions taken because a federal law or regulation requires the disclosure or verification of salary history for employment purposes or requires knowledge of salary history to determine an employee's compensation.

4 This is a requirement under the California, Colorado, Cincinnati, Toledo, and Oregon laws.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions