Gender Wage Gap and Salary History Ban- what employers need to know and actions to take now!

In a ruling that has widespread impact for employers, a federal court has ruled that employers can’t pay women less than men just because a woman made less at a previous job. To do this perpetuates the gender wage gap and is discriminatory.

The Equal Pay Act was signed into effect in 1962 was intended to eliminate gender pay disparities yet women are still paid less than men on average.

Employers need to take action to review hiring practices and use legitimate job related factors such as experience, educational background, and skills.

Six states – California, Delaware, Massachusetts, New Jersey, New York or Oregon have outlawed salary history inquiries meaning that employers may not ask about prior salary or use this as a basis for determining salary in hiring decisions.

In addition, California’s Equal Pay Act requires fair pay for men and women who perform “substantially similar work.”

It’s important that hiring managers, recruiters and others involved in hiring are aware of and trained in the regulations. Documents such as application forms and screening questions in applicant tracking systems will also need to be updated to comply.

Many employers are choosing to conduct a self-audit of their pay to proactively adjust any pay disparities. Demographics, job title, compensation bands and performance information should be reviewed as part of the process. Companies also need to consider any differences in pay among employees in similar positions but with different job titles and those who work in other locations.

BlueFire HR can review and assess your current hiring practices and help you conduct a fair pay audit. Reach out today and see how we can help! For more information, please contact us at hr@bluefirehr.com, 773-793-1362 or at 888-892-9597.

 

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