Dive Brief:
- Michigan's governor signed a bill March 26 that forbids localities from adopting salary history bans.
- Senate Bill 353 prohibits local governments from adopting rules regulating the information that an employer or potential employer must request or exclude on an application for employment or during the interview process from an employee or potential employee.
- Local media had previously reported that Democrats blasted the bill as an attack on local control and argued it could hinder community efforts to address pay gaps among women, minorities and other workers who have historically earned less than their peers. The Michigan Chamber of Commerce and other business groups supported the legislation.
Dive Insight:
The legislation, which appears to be the first of its kind, comes as several other states and cities move to prevent employers from asking about applicants' compensation history. The bans are largely aimed at ending pay discrimination and wage gaps, as many have argued that setting wages based on salary history reinforces wage gaps.
Some of the laws go further than merely banning pay history questions and also prohibit employers from relying on an applicant’s pay history to set compensation if discovered or volunteered. The laws are facing some judicial challenges, however.
As these bans continue to spread across the country, several employers have voluntarily stopped asking about past pay, including big names like Amazon and Progressive. Some have said that pay equity played a part in their decision, while others said it was too difficult to comply with the patchwork of state and local laws.
