?The Biden administration proposed a rule May 11 that would bar federal agencies from using salary history to set the pay of new hires. The federal government is the nation’s largest employer, and private sector employers may follow federal agencies’ lead. Several states and localities have implemented their own bans on salary history.
We’ve rounded up articles from SHRM Online and other outlets to provide more context on the news.
Closing Pay Gaps
Pay equity proponents have argued that relying on a job applicant’s past or current salary to determine their pay has perpetuated inequity and effectively anchors workers to lower pay throughout their careers.
(Axios)
Spreading Momentum
A growing number of states and localities prohibit employers from requesting salary information from job applicants and require employers to disclose the pay range for a position to applicants or employees. Currently 21 states have banned or limited questions about previous pay when hiring.
Employers Adjust to Salary-History Bans
For HR professionals and hiring managers, the growing patchwork of laws requires vigilance and training so that everyone involved knows what they can and cannot ask a job candidate.
Pay Transparency Improves Business Outcomes
About 70 percent of organizations that list pay ranges in job advertisements said that the move has led to more people applying for their jobs, and 66 percent discovered that it has increased their quality of applicants, according to new data by SHRM Research.
Perceptions of Pay Equity Differ Greatly
Employers are making progress when it comes to providing equal pay, yet employers and employees have vastly different perceptions on how that is being achieved, and also differ on whether the CHRO, CEO or another member of the executive team should lead the pay equity effort, research shows.