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published on July 20, 2017 - 4:27 PM
Written by Gordon Webster, Jr.

It seems like much of the legislation coming out of Sacramento is geared toward exposing small business owners to more and more potential litigation.

If I didn’t know any better, our state’s lawmakers are in the business of hurting job creators.

The latest measure, AB 168, would open employers up to lawsuits for inquiring into a job applicant’s prior salary.

AB 168 — which also penalizes employers for failing to provide a pay scale upon demand even if the applicant suffers a wage loss — recently passed its second committee in the state Senate.

The California Chamber of Commerce is opposing this bill, which places unhelpful hurdles in the hiring process and is also addressed by existing law.

Another bill from last year, AB 1676, ensures that an employer could not base an applicant’s or employee’s compensation solely on past salary. That language was negotiated by the business community, and it went into effect on Jan. 1.

As the CalChamber and a coalition of business interests point out, there are several legitimate, nondiscriminatory reasons for an employer to seek prior compensation information. For example, employers don’t always have accurate wage information based on market conditions for each position. Many employers do not advertise salaries for fear of competition in hiring.

Such information makes it easier for employers to set realistic salary expectations.

Prior salary data can also save the employer and applicant time and resources. If the employer can’t match the applicant’s salary expectations (based off of salary history), there’s no sense in wasting time going through the hiring process for either party.

It may be interesting to note that the “California Fair Pay Act” went into effect on Jan. 1, 2016, and it was heralded as one of the nation’s strongest equal pay laws. Part of the law provides protections for employees to openly discuss wage information without fear of retaliation.

So employees have all the leeway to talk about their compensation with each other, but once an employer requests that information, it’s time to call a lawyer.

Only in California.


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