California: New Guidance Regarding the Fair Pay Act and Salary History Inquiry Ban

APPLIES TO

All Employers with CA Employees

EFFECTIVE

January 1, 2019

QUESTIONS?

Contact HR On-Call

(888) 378-2456

AB 2282, the Fair Pay Act Bill, takes effect on January 1, 2019 and clarifies California’s Fair Pay Act and salary history inquiry ban. Under California’s salary history ban, employers are prohibited from taking salary history into account when setting pay rates and are required to provide applicants with a pay scale for the position being applied to upon receipt of reasonable request. The new Bill makes clear that:

  • an employer is only required to provide a pay scale to new job applicants and not to current employees;
  • the pay scale need only be provided to applicants who have completed at least one interview with the employer;
  • the pay scale may simply be a salary or hourly wage range;
  • employers may ask applicants about their desired pay or salary expectations during the recruitment process; and
  • when making compensation decisions for current employees, employers may take their salary history into account, provided that it complies with the other provisions of the Fair Pay Act.

Action Items

  1. Update hiring and pay setting practices consistent with the new clarifications.
  2. Have applicable managers trained on the salary history inquiry ban and Fair Pay Act requirements, including legitimate job-related factors that may justify wage differentials.
  3. Have a compensation audit performed to identify wage differentials, if any, and determine if such gaps are justifiable.
  4. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

© 2018 ManagEase

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