What You May Not Even Ask in the Future When Hiring Employees in California

Good morning!  I was reading this article written by Gina Rikonova in the L.A. Daily Journal, and she talks about Assembly Bill 168 that was introduced earlier this year which will prohibit California employers from requesting information about a job applicant’s salary history or benefits  The spirit of the bill, according to her, is really to combat the gender disparity of pay between men and women. She also talks about how a lot of states that are moving toward this trend. Then she circles back and introduces what’s pretty much a federal court ruling for this year in April that seems to go opposite direction. That particular ruling in federal court “that federal equal pay act salary history may be considered a qualified factor other than sex so long as it effectuated some business policy and was used reasonably in light of the stated purpose as well as its other policy or practices, and the court further states that on the salary history standing alone may constitute a qualified reason for pay disparity other than sex so long as it serves a legitimate business purpose”.
             Now a bit of disclaimer.  I’m not a labor law attorney, and this information not for legal advice. I’m really talking to you not as a lawyer, but as a business owner of a law practice. First of all, I totally agree with the spirit of the bill and the purpose to combat the gender disparity of pay. I am all for it. But let’s think about the practical effect of this bill if it passes. I think is a little bit scary, as a small business owner because I need to watch out for the dollar amount  the budget of my company. I like to have the flexibility of hiring. See, when I hire employees I look at their qualifications. I look at their history of work, what they can do for the firm, and I need to know their salary requirements so that I can make some choices.

The key to this is choices.  Why is that important to me?  Well, as a small business owner I don’t have unlimited budget and I often have to make choices based on the qualifications of the candidates, based on the skills, based on their work history and really whether or not I can afford to pay them.  Let’s say I have the top three candidates of an applicant pool, sitting in front of me and I have to make a choice to hire one of them. Each has different skills. Each has a salary requirement . Sometimes, I absolutely had to hire the top candidates with the top skills. But as a small business owner, sometimes the cost of hiring that individual can be just out of touch, right?  So I have to go to the next candidate and say, “Okay, this candidate is a little less skilled, personality is ok. The candidate still fits the job description, but not as good as the first one and the salary requirement reflects that.  Maybe this candidate is more affordable and I can train this candidate so that he or she will grow as an employee after hire.”

So that’s a kind of choice that I have to make, and I really don’t like a regulation telling me I cannot even ask their salary history to make that a part of my hiring decision I understand there are a lot of laws surrounding this topic already.  A lot of employers, don’t even want to risk getting in trouble and avoid asking the salary history.  But once this law passes, it’s a required for employers to leave salary requirement out of employment decisions and I just don’t like that idea at all.  I wish that there’s a better solution to combating the gender equality.  I’m all for gender equality, but the construction of this bill can have a negative impact on small business owners. That’s my take on it.  Until next time, I’ll talk to you later.

Good morning!  I was reading this article written by Gina Rikonova in the L.A. Daily Journal, and she talks about Assembly Bill 168 that was introduced earlier this year which will prohibit California employers from requesting information about a job applicant’s salary history or benefits  The spirit of the bill, according to her, is really to combat the gender disparity of pay between men and women. She also talks about how a lot of states that are moving toward this trend. Then she circles back and introduces what’s pretty much a federal court ruling for this year in April that seems to go opposite direction. That particular ruling in federal court “that federal equal pay act salary history may be considered a qualified factor other than sex so long as it effectuated some business policy and was used reasonably in light of the stated purpose as well as its other policy or practices, and the court further states that on the salary history standing alone may constitute a qualified reason for pay disparity other than sex so long as it serves a legitimate business purpose”.

Now a bit of disclaimer.  I’m not a labor law attorney, and this information not for legal advice. I’m really talking to you not as a lawyer, but as a business owner of a law practice. First of all, I totally agree with the spirit of the bill and the purpose to combat the gender disparity of pay. I am all for it. But let’s think about the practical effect of this bill if it passes. I think is a little bit scary, as a small business owner because I need to watch out for the dollar amount  the budget of my company. I like to have the flexibility of hiring. See, when I hire employees I look at their qualifications. I look at their history of work, what they can do for the firm, and I need to know their salary requirements so that I can make some choices.

The key to this is choices.  Why is that important to me?  Well, as a small business owner I don’t have unlimited budget and I often have to make choices based on the qualifications of the candidates, based on the skills, based on their work history and really whether or not I can afford to pay them.  Let’s say I have the top three candidates of an applicant pool, sitting in front of me and I have to make a choice to hire one of them. Each has different skills. Each has a salary requirement . Sometimes, I absolutely had to hire the top candidates with the top skills. But as a small business owner, sometimes the cost of hiring that individual can be just out of touch, right?  So I have to go to the next candidate and say, “Okay, this candidate is a little less skilled, personality is ok. The candidate still fits the job description, but not as good as the first one and the salary requirement reflects that.  Maybe this candidate is more affordable and I can train this candidate so that he or she will grow as an employee after hire.”

So that’s a kind of choice that I have to make, and I really don’t like a regulation telling me I cannot even ask their salary history to make that a part of my hiring decision I understand there are a lot of laws surrounding this topic already.  A lot of employers, don’t even want to risk getting in trouble and avoid asking the salary history.  But once this law passes, it’s a required for employers to leave salary requirement out of employment decisions and I just don’t like that idea at all.  I wish that there’s a better solution to combating the gender equality.  I’m all for gender equality, but the construction of this bill can have a negative impact on small business owners. That’s my take on it.  Until next time, I’ll talk to you later.