This particular case, which was decided before Reinhardt died at age 87 in March, centered on Fresno teacher Aileen Rizo, who sued her employers after finding out that her male colleagues were being paid higher salaries. The Fresno County Office of Education argued that starting salaries in the district are based on employee’s prior salary – something not unheard of in many industries.
Given the court’s ruling this may need to change, and could even become akin to a “don’t ask, don’t tell” policy for employees and employers alike.
“Even before this federal appeals court ruling, we had already begun to see some companies, as well as entire states, move away from, or completely ban the practice of mandatory salary history disclosure,” said Nidhi Gulati, chief recruiter at Sevatec. “With this ruling, we would expect to see that movement accelerate.”
While experience – not how much someone was paid for the job – could be the determinant that sets future salary, for too long what you were paid previously was the primary consideration, proponents for gender pay equality argue.
“Asking about past salary is an important contributor to the (gender) wage gap,” said Dr. Yasemin Besen-Cassino, professor of sociology distinguished scholar at Montclair State University.
“By asking about previous salaries, the new employers perpetuate the existing differences in pay,” Besen-Cassino told ClearanceJobs. “Even when women negotiate, the starting point is much lower. Asking about past salary is holding women back.”
To address it, some state lawmakers have even proposed new legislation that could make past salary or compensation irrelevant to future compensation negotiations.
“In New Jersey Governor Phil Murphy signed an executive order to ban salary history inquiries for state employees,” added Besen-Cassino. “Similar legislation is important to make sure gender inequalities do not follow women around even when they change jobs.”
This will no doubt require some changes in the hiring process, and past salary could join asking about age and marital status as things an employer can’t enquire about. It will also change the way salary is negotiated.
“HR departments across the country will need to rethink and reevaluate their salary negotiation strategy after reviewing the ruling handed down by the court,” Gulati told ClearanceJobs, who added that this should be seen as a welcome change. “Why should a person’s financial value with a new employer be tied to their value with a previous employer?”
However, even legislation removing past salary disclosure from the hiring process won’t completely bridge the gender pay gap.
“While it is very important, it is not the only factor contributing to the wage gap,” added Besen-Cassino. “Even when the past salaries are not asked, salary information is not always publicly available and many women find it hard to get information on how much jobs pay. Men’s networks are more likely to talk about money and offer salary information than women’s networks, so it is important for women to get the information they need on pay.”
By: Peter Suciu, Clearance Jobs
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