A growing trend in employment law has been the increase in state and local governments enacting legislation preventing employers from seeking the salary history of job candidates
Over a dozen states and cities already have salary history ban laws on the books. Just a few weeks ago, New York became the latest state
to sign legislation that addresses salary inquiries.
And now, yet another state has joined in creating and enacting a salary history ban law, adding to the list of employment legislation they have passed in recent months.
New Jersey Bans Salary History Inquiries
New Jersey lawmakers have been busy passing various employment legislation since Governor Phil Murphy has taken office.
Increased minimum wage
, expanded paid leave programs
, and a state-run retirement plan
are just a few of the major laws that have been signed.
Now, the state becomes the latest to enact a salary history ban. Lieutenant Governor Sheila Oliver, the acting Governor while Phil Murphy was vacationing, officially signed the bill in late July.
Last year, Governor Murphy had signed an executive order that banned salary history inquiries for the state government.
Taking effect on January 1, 2020, the law prevents employers from asking job seekers for past salary, benefits, and other compensation
they may have received. Additionally, employers are now prohibited from requiring that prior salary history satisfies any minimum or maximum threshold in order to qualify for a job.
Employers will be subject to penalties if they violate the salary history ban. In addition to a private right of action, employers may face civil penalties of up to $1,000 for a first offense, $5,000 for a second, and $10,000 for any further violations.
What Does the Law Mean for NJ Employers?
As is the case with most employment legislation, there are a few exceptions to New Jersey’s salary history ban
. The first is that if an employer operates in New Jersey as well as other states, they are allowed to have a salary history question on their application, as long as they have a disclaimer that if the position is located in New Jersey, the applicant does not have to answer.
It’s also ok for employers to seek salary history information if an applicant voluntarily discloses this information without any prompting from the employer
Employers may also request to confirm salary history after an employment offer has been made which includes the complete compensation package.
It’s important to note that the law does not apply
to applications for internal promotions or transfers.
With the law taking effect on January 1, New Jersey employers need to take action to be prepared for this legislation. Reviewing all job application templates, interview materials, recruiter and hiring manager guidelines, and background check processes are a must to make sure salary history questions are removed.
New Jersey Continues to Pass New Employment Legislation
New Jersey lawmakers continue to draft and enact new or updated employment legislation, which means employers and business leaders in the state need to keep up with news surrounding potential laws.
Doing so can help businesses be prepared for if and when a new law is passed. Owners can also reach out to HR and compliance professionals for assistance if they aren’t sure how to get ready or update policies and documents to remain compliant.
One area of HR is becoming increasingly more difficult for small employers to properly handle — maintaining compliance with employment laws. Download our eBook, Guide to Employment Law: Topics Employers Must Know to Stay Compliant, to learn more about some of the biggest trends and topics in employment law.