United States: New Pay Equity Laws In New York And New Jersey (Again) (Update: New Jersey Law Signed Into Law)

Seyfarth Synopsis: This week, New York state expanded a state Equal Pay Act, making it illegal to pay someone less based on characteristics including race, religion, disability or gender identity, and also other protected characteristics. New York state also passed a salary history ban. Also, just one state over, on June 20, 2019, the New Jersey Legislature passed a salary history ban and New Jersey Governor Phil Murphy is expected to sign the measure into law.

UPDATE: The New Jersey law was signed by Governor Murphy on July 25, 2019. The New Jersey law goes into effect on January 26, 2020

Changes to the New York State Laws

This week, New York state enacted two new pay equity laws. The first modified the state's equal pay law and the second will ban employers from seeking salary history from applicants or current employees. Key provisions of these laws are summarized below.

Previous Modifications to the New York State Pay Equity Law

In November 2015, New York State became one of the first jurisdictions to pass a pay equity law that was more extensive than the federal equal pay laws. When this law went into effect in January 2016, New York Labor Law § 194 was amended to:

  • Outline the geographic scope of who could be compared under the pay equity law;
  • Put the burden on employers to affirmatively demonstrate that any pay differences are based on one or more of a limited number of factors. The permitted reasons for differences in pay are:
    • A seniority system;
    • A merit system;
    • A system that measures earnings by quantity or quality of production; or
    • A bona fide factor other than sex such as education, training, or experience. This bona fide factor exception will replace the "any other factor other than sex" language in the current law, and will apply only if the employer demonstrates that the factor is not based on or derived from a sex-based differential in compensation, is job related with respect to the position in question, and is consistent with a "business necessity" (i.e., the factor relied upon effectively fulfills the business purpose it is supposed to serve). But this defense will not apply if there is an employment practice that causes a disparate impact, or if the employer refuses to adopt a neutral alternative practice that would serve the same business need.
  • Prohibit employers from prohibiting employees from inquiring about, discussing, or disclosing wage information, and
  • Increase the liquidated damages for willful violations of § 194 to 300% of wages due.

These prohibitions were expanded with the amendment of Section §194, which was signed by Governor Cuomo this week.

Expanded New York State Pay Equity Law

The revisions to New York Labor Law § 194 signed by Governor Cuomo on Wednesday, July 10, 2019, will expand upon the equal pay law in meaningful ways.

First, the New York state law makes it illegal pay someone less based on characteristics beyond just sex including age, race, creed, color, national origin, sexual orientation, gender identity or expression, military status, sex, disability, predisposing genetic characteristics, familial status, marital status, or domestic violence victim status. In this regard, New York state will join other jurisdictions, like New Jersey and Washington State, to have a very expansive view of who is protected under the pay laws.

Second, the New York equal pay act was amended to allow employees can be compared even if they do not hold the "same" job. The new law would require only a showing that the employees are engaged in "substantially similar work, when viewed as a composite of skill, effort, and responsibility, and performed under similar working conditions." Like similar expansions in California, New Jersey, Massachusetts, and elsewhere, this will increase the scope of who can be compared under these pay equity laws.

In combination, these provisions further expand upon the protections under the federal pay equity laws and will make it more challenging, and more important, for employers to be attuned to how employees are paid.

New York State Salary History Ban

The expanded pay equity law was not the only law signed into law on Wednesday in New York state. Governor Cuomo also signed into law a salary history ban, adding a new section to New York Labor Law § 194-a.

With the passage of this law, New York State will join many other states and jurisdictions with a salary history ban that applies to applicants for employment.1

Like many of the salary history bans the New York State law will:

  • Forbid employers from orally or in writing seeking, requesting, or requiring the wage or salary history from an applicant or current employee as a condition to be interviewed, or as a condition of continuing to be considered for an offer of employment, or as a condition of employment or promotion. Employers also cannot seek wage or salary history from a current or former employer, current or former employee, or agent of the applicant or current employee's current or former employer.
  • Prohibit employers from relying on the wage or salary history of an applicant in determining whether to offer employment to such individual or in determining the wages or salary for such individual.
  • Prohibit employers from refusing to interview, hire, promote, otherwise employ, or otherwise retaliate against an applicant or current employee based upon prior wage or salary history, the refusal to provide the same, or because the individual filed a complaint with the department alleging a violation of the law.

What is different from some of the other salary history bans -- for example, in California, is that is law also applies to current employees.

Exceptions to the New York Salary History Ban Law

While employers are forbidden to ask about prior wages, the law does not prevent an applicant or current employee from voluntarily, and without prompting, disclosing or verifying wage or salary history, including but not limited to for the purposes of negotiating wages or salary.

Further, the New York state law allows employers to confirm wage or salary history if, at the time an offer of employment with compensation is made, the applicant or current employee responds to the offer by providing prior wage or salary information to support a wage or salary higher than offered by the employer.

Finally, the law makes clear that it does not supersede any federal, state or local law enacted prior to the effective date of this section that requires the disclosure or verification of salary history information to determine an employee's compensation.

Damages Under New York State Salary History Ban

The law provides a private right of action to applicants or current or former employee. The court may award injunctive relief as well as reasonable attorneys' fees to a plaintiff who prevails in a civil action brought under this paragraph.

The New York pay equity law goes into effect on October 8, 2019 and the New York state salary history ban law goes into effect on January 6, 2020.

The New Jersey Salary History Ban Law

Just across the border, New Jersey made modifications to its state pay equity laws.

More than a year after passing the sweeping pay equity legislation known as the "Diane B. Allen Equal Pay Act", the New Jersey Legislature passed Assembly Bill 1094 on June 20, 2019, which would amend existing law to prohibit employers from screening applicants based on salary history, requiring applicants to satisfy any minimum or maximum salary criteria, or considering an applicant's refusal to volunteer salary history information in any employment decisions. The Act also provides that a violation of these provisions would be an unlawful employment practice under the Law Against Discrimination ("LAD"), if the applicant is a member of a protected class.

This is the second attempt to pass salary history legislation in New Jersey. On July 31, 2017, former Governor Chris Christie vetoed a similar bill passed by the legislature. Governor Phil Murphy was widely expected to sign A1094 into law. On January 16, 2018, Governor Murphy signed an executive order banning salary history inquiries by state governmental entities. In doing so, he urged the legislature to pass a statewide ban on the practice and pledged to sign any such legislation that landed on his desk. And Governor Murphy signed the salary history bill impacting private employers into law on July 25, 2019.

Key provisions of the Act are summarized below.

Unlawful to Screen Any Applicant Based on Salary History in New Jersey

Like in many other jurisdictions, as noted above, the New Jersey Act prohibits an employer from screening any job applicant based on salary history, including but not limited to wages, salaries, or benefits.

It would also prohibit an employer from requiring an applicant's salary history to satisfy any minimum or maximum criteria.

Additionally, the Act would prohibit an employer from considering an applicant's refusal to volunteer salary history in any employment decisions. Any violation by an employer of the aforementioned salary history inquiry prohibitions would also be an unlawful employment practice in violation of the LAD if the applicant is a member of any of the protected classes enumerated in the LAD.

Exceptions to the New Jersey Salary History Ban Law

The New Jersey Act contains several notable exceptions.

First, if an applicant voluntarily provides an employer with salary history information, the employer would be allowed to:

  • Consider the applicant's salary history in determining compensation for the applicant; and
  • Verify the salary history information voluntarily provided.

Second, after an offer of employment that includes an explanation of compensation has been extended to an applicant, an employer would be allowed to request that the applicant provide a written authorization to confirm the previous salary history.

Third, employers are not prohibited from acquiring salary history information that is publicly available, but shall not retain or consider that information when determining the salary, benefits, or other compensation of the applicant unless the applicant voluntarily, without employer prompting or coercion, provides the employer with salary history. Importantly, an applicant's refusal to volunteer this information may not be considered by the employer in any employment decisions.

Further, the provisions of the Act would not apply to:

  • Applications for internal transfer or promotion under the same employer;
  • An employer's use of previous knowledge acquired as a result of an applicant's prior employment with the employer;
  • Actions taken by an employer pursuant to a federal law or regulation that requires disclosure, verification, or use of salary history for employment purposes;
  • An employer's attempt to obtain or verify an applicant's disclosure of non-salary-related information when conducting a background screening, provided that the employer specifies that salary history is not to be disclosed when requesting information for the background check. However, if salary history is nonetheless disclosed, the employer would be prohibited from retaining the information or considering it when determining compensation for the applicant; or
  • An employer's inquiries regarding an applicant's previous experience with incentive and commission plans, provided that the compensation package for the position for which the applicant is being considered includes an incentive or commission component and the employer does not seek information regarding the applicant's previous earnings in connection with any incentive or commission plan.

No provision of the Act would prohibit employers from:

  • Offering an applicant information regarding compensation set by law or a collective bargaining agreement, and paying the applicant according to this information if hired;
  • Including a salary history inquiry on a job application if the employer does business, employs persons, or takes applications in at least one state besides New Jersey, provided it is permissible in that state and that the application contains a notice immediately preceding the inquiry that instructs New Jersey applicants not to answer

Civil Penalties For Violations of the New Jersey Salary History Ban

An employer that violates the Act would be liable for a civil penalty not to exceed:

  • $1,000 for the first violation;
  • $5,000 for the second violation; and
  • $10,000 for each subsequent violation.

Interestingly, the Act makes clear that an award of neither attorney's fees nor punitive damages would be available as a remedy for any violation of the salary history inquiry prohibition.

The law goes into effect on January 26, 2020.

What's Next for New York or New Jersey Employers?

These developments follow the trend of the equal pay movement taking place in cities and states nationwide. In light of New York and New Jersey's focus on equal pay, employers should be mindful of these new restrictions and evaluate how the new legislation would impact their hiring practices.

Footnote

[1] Fourteen states (Alabama*, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Massachusetts, New Jersey, Oregon, Vermont, Washington, and now New York), nine cities or counties (San Francisco, CA, Kansas City, MO, New York City, NY, Albany County, NY, Suffolk County, NY, Westchester County, NY, Cincinnati, OH, Toledo, OH, and Philadelphia, PA) and one Territory (Puerto Rico) have passed salary history bans. *Note: The Alabama and Philadelphia do not outright ban soliciting salary history but do restrict its use.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
Ogletree, Deakins, Nash, Smoak & Stewart
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Ogletree, Deakins, Nash, Smoak & Stewart
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions