Pay Equity: An Overview for Executive Search Pay Equity | Page 15
San Francisco at a Glance
• The Bill comes into force on July 2018, with penalties enforced from July 2019.
• The legislation prevents employers from considering or relying on a candidate’s salary
history as a factor in determining whether to offer employment or what salary to offer.
• The legislation prevents employers from inquiring about a candidate’s salary history.
• Refusing to hire or disfavoring, injuring or retaliating against a candidate for not disclosing
salary history to the employer is prohibited.
• Pay Equity prevents an employer from releasing the salary history of any current or former
employee to that person’s prospective employer without written authorization from the
current or former employee (unless required by law).
• From July 2019, violation penalties are $100 for the first offense and $200 for the second
offense and then $500 for each subsequent violation for each candidate whose rights were
violated.
• An employer may, without inquiring about salary history, engage in discussion with the
candidate about their expectations with respect to salary, benefits and other compensation
(including unvested equity or deferred compensation from previous employer that would
be forfeit).
• Nothing prohibits an employer from verifying non-salary related information disclosed
by the candidate or from conducting a background check providing that if such
process discloses salary history that history shall not be considered for the purposes of
determining the salary to be offered or whether to offer employment.
• If a candidate, without prompting, voluntarily discloses salary history then this may be
considered in determining salary, benefits and other compensation, and the employer may
verify such candidate’s history.
• Salary history by itself shall not be used to justify paying any employee of a different sex,
race or ethnicity less than another applicant or prospective employee for similar work.
Key definitions
• The term employer includes search firms, employment agencies, job placement and
referral agencies working on behalf of the employer.
• Inquire shall mean any direct or indirect statement, questions, prompting or other
communication, orally or in writing, personally or through and agent, to gather
information from or about an applicant, using any mode of communication including but
not limited to application forms and interviews.