Approximately 21 states and several municipalities have enacted laws that prohibit inquiries by employers into the salary history of applicants. These laws are based primarily on the arguments that: 1) salary history does not accurately reflect an applicant’s qualifications and capabilities, or the market standard for similar positions; 2) relying on the salary history of an applicant when making a job offer will perpetuate any prior disadvantages the applicant experienced in the job market; and 3) considering the salary history of an applicant disproportionately affects women and people of color, and potentially others, who historically have been underpaid due to discrimination.
On March 1, 2024, a new Salary Ban Law will go into effect in Columbus, Ohio, and serves as a reminder to employers that they need to check and be aware of any salary history laws that may exist in the cities and states where they have employees. Employers also need to be mindful of any pay equity statutes and ordinances under federal, state or local law that require an employer to reveal a relevant pay scale to external applicants.
With respect to the Columbus law, it applies to all businesses that employ 15 or more people within the City of Columbus, and only applies to applicants for new employment and not current employees seeking a transfer or promotion with the business. Additionally, applicants may voluntarily share their salary history with an employer in Columbus and, if they do so, the employer may discuss it with the applicant.
There are several exemptions that apply to the Columbus law in addition to that for internal applicants, such as positions where compensation is set by a collective bargaining agreement, and applicants for positions with the state and federal government offices in Columbus.
Any person or labor union can file a complaint alleging a violation of the Columbus law. Complaints will be investigated by the Columbus Community Relations Commission, which can impose fines of $1,000 for a first offense, $2,500 for a second violation, and $5,000 for a third violation within a five-year period. The Commission also can refer a complaint to the City Prosecutor for potential criminal prosecution.
Despite the restrictions in the Columbus law, it expressly allows, as do many of the other state and local salary ban laws, for employers to inform an applicant of the salary range for the relevant position, and also to discuss with the applicant their salary expectations.
If you have questions about the Columbus Salary Ban Law, or any Pay Equity Law, or a general labor or employment question, feel free to contact Joel Hlavaty or any member of Frantz Ward’s Labor & Employment Group.