New York Significantly Expands its Equal Pay Protections and Bans Salary History Inquiries
New York recently enacted legislation significantly expanding its equal pay laws and prohibiting employers from inquiring into an applicant’s salary history. These new laws bring New York State, as a whole, in line with laws currently in effect in New York City and become effective October 8, 2019.
Currently, New York law protects against gender-based pay inequality by requiring equal pay for equal work. The new legislation, similar to New Jersey’s recent pay equity law expansion, requires equal pay for “substantially similar work” and applies to all protected categories, including, race, sexual orientation, and disability, not just gender.
Pay differentials for substantially similar work will be permitted when based upon a seniority system, a methodology that measures earnings by quality or quantity, or a bona fide reason other than an individual’s membership in a protected category. Pay differentials, to be legal, must be job related and due to a business necessity, such as geography, education, or experience.
As with most employment laws, employers face significant liability for violating the law, regardless of whether the violation was intentional or not. Under the new pay equity law, employers may be held liable for treble (i.e. triple) damages, in addition to other damages and penalties.
As noted above, the new standard for pay equality becomes effective on October 8, 2019. Thus, employers in New York should immediately start reviewing their pay practices to ensure that employees who perform “substantially similar” work (not equal work) are paid equally. If an employer finds pay disparities between employees for substantially similar work, the employer will need to assess whether the pay differentials can be justified under the new law.
Salary History Ban
Along with the expansion of its equal pay laws, New York also enacted a ban on salary history inquiries. A similar ban has been in effect in New York City since October 31, 2017, so employers in New York City should already be in compliance with the new State law. Employers in other parts of New York, need to start updating their employment applications and hiring practices to remove any requests for an applicants’ salary history.
If you have questions about your business’s pay or hiring practices, please contact us at (646) 503-5358 or through our online scheduling calendar to set up a complimentary consultation.