April 16th, 2018 | Debbie Lamb, Sterling Talent Solutions
Michigan and Wisconsin Bans Salary History Ban Laws
Since Massachusetts first passed salary history ban legislation in 2016, seven other states and cities (California, Delaware, Oregon, Philadelphia, New York City, San Francisco and Albany), have passed their own salary history banning laws. Some of these laws have gone into effect, while others will be enacted in the next few years. Each of the cities and states who have passed enacted banning salary history legislation all have a common goal of erasing the pay gap, but each state has unique provisions to their laws. However, two states, Michigan and Wisconsin, have put a stop to the growing trend of passing these laws in municipalities in their states.
Michigan Bans Salary History Bans
On March 26, 2018, Michigan Governor Rick Snyder signed a bill that prohibits local governments from regulating the information employers can request from prospective employees during the interview process. Public Act 84 provides that “[a] local governmental body shall not adopt, enforce, or administer an ordinance, local policy, or local resolution regulating information an employer or potential employer must request, require, or exclude on an application for employment or during the interview process from an employee or a potential employee.” The law will go into effect by the end of June 2018.
Also, Public Act 84 restricts local government from implementing Ban the Box ordinances that prohibit employers from inquiring about an applicant’s criminal conviction history. The National Law Review explains, “Even though local government bodies are barred from creating ordinances in this space, significant statutory protections for applicants and employees exist under Michigan law, and employers are already required to follow them.”
Wisconsin Bans Salary History Bans
Wisconsin lawmakers passed similar legislation specifically prohibiting salary bans on March 29, 2018. The law is awaiting governor Scott Walker’s signature. Wisconsin AB 748 states that an employer may solicit information regarding the salary history of prospective employees. The law details, “The legislature finds that the provision of an employer right to solicit salary history information that is uniform throughout the state is a matter of statewide concern and that the enactment of an ordinance by a city, village, town, or county that prohibits an employer from soliciting salary information would be logically inconsistent with, would defeat the purpose of, and would go against the spirit of this section. No city, village, town, or county may enact or enforce an ordinance prohibiting an employer from soliciting information regarding the salary history of prospective employees.”
Supporting or Opposing the Laws
There are supporters and opponents to the Michigan and Wisconsin laws. The supporters say that the laws provide a consistent policy across their states and eliminates the need for employers to comply with multiple and often conflicting local ordinances. The opponents say that it hinders recent efforts to achieve pay equity, which would force employers to base compensation decisions on a candidate’s experience and skill set instead of relying on possible past discriminatory salary practices.
Salary History Ban Laws Impact on Hiring Processes
Even with Michigan and Wisconsin putting limitations on the salary history ban laws, there continues to be a growing trend of local and state legislatures across the country enacting similar laws. Employers who have offices in multiple states should consider making company-wide changes regarding salary history inquiries during the hiring process. Employers should consult with legal counsel to review and revise all hiring documents employment applications, background check forms, or any other forms used during the hiring process to ensure that there are no inquiries regarding salary history. HR teams, recruiters and hiring managers who conduct interviews of applicants will need to be trained on the implications of the new laws.
It is imperative to stay up-to-date on the latest human resources and background screening trends, laws and compliance standards. Sterling Talent Solutions is here to help with your background screening and onboarding needs. Learn steps to protect your business by being compliant with laws for your background screening policies in our new white paper, Five Critical Steps to Criminal Record Check Compliance.
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