Overview: Kansas City, Missouri has enacted an ordinance that will generally prohibit employers from asking applicants about their pay history. The ordinance takes effect October 31, 2019.
Details:
Covered Employers:
The ordinance applies to employers with six or more employees.
Prohibitions:
The ordinance prohibits covered employers from:
· Asking an applicant or their current or former employer about the applicant’s pay history;
· Screening applicants based on their current or prior compensation or benefits, including requiring their pay to satisfy minimum or maximum criteria;
· Relying on an applicant’s pay history in deciding whether to offer a job, or in determining the applicant’s compensation or benefits, including the negotiation of an employment contract; and
· Refusing to hire or otherwise taking adverse action against an applicant for failing to disclose their pay history.
Without inquiring about pay history, employers may engage in a discussion with the applicant about their expectations with respect to pay and benefits, including unvested equity or deferred compensation that an applicant would forfeit by virtue of the applicant’s resignation from their current employer. Employers may also inform the applicant about the position’s proposed or anticipated salary or salary range.
Exceptions:
The prohibitions don’t apply to:
· Applicants for internal transfer or promotion with their current employer;
· An applicant’s voluntary and unprompted disclosure of pay history information;
· An employer’s attempt to verify an applicant’s disclosure of non-pay related information or to conduct a background check, provided that if it reveals the applicant’s pay history, such information is not relied upon for purposes of determining the applicant’s compensation or benefits;
· Positions for which compensation and benefits are determined pursuant to procedures established by collective bargaining; and
· Applicants who are re-hired by the employer within five years of the applicant’s most recent date of termination, provided that the employer already has past salary history data regarding the applicant from the previous employment.
Action Required: Covered employers should review their hiring procedures and remove pay history questions from their application forms and interviews. Anyone involved with screening or hiring applicants should also be trained on the law.
Please contact your dedicated service professional with any questions.
This content provides practical information concerning the subject matter covered and is provided with the understanding that ADP is not rendering legal advice.