Although it’s been illegal to pay women less than men since 1963, some practices that persist may result in an offer of compensation that is lower for one candidate and higher for another – for the same job. The solution may be to forbid a company from asking a potential employee what he or she has been paid in the past.
According to an article in New Republic, being asked for salary history, may “seem like a neutral practice” in a job interview, but “it can perpetuate the inequities that mean women and people of color are paid less on average, than white men.” Basing pay on previous earnings means that a woman who started with lower pay will continue to “pay the price” throughout her working life.
The practice of preventing employers from requesting salary histories before they make an official job offer is gaining ground. In 2016 Massachusetts became the first state to pass such a law, and other states, including Connecticut, Delaware, Oregon, Vermont, California, Maine, and New York have passed similar laws. Some companies such as Amazon, American Express, Bank of America, Facebook, Google, Starbucks, and Wells Fargo also have announced they won’t factor in prior pay to set compensation.
The article reports on a recent field experiment that found that “employers who couldn’t see salary histories actually did more individualized research into candidates, and candidates were better able to bargain for higher starting salaries.”