by Molly DiBianca
Delaware’s new law limiting employers’ ability to inquire about job candidates’ compensation history is set to take effect on December 14.
The law is intended to address pay disparities between men and women. Because women often make less than their male counterparts, the pay gap is perpetuated if women’s wages are based on salary history instead of a set range for a particular position. Thus, according to the theory, the new law will level the playing field.
The law prohibits employers from asking about an applicant’s salary history or using salary history as a screening criterion. A candidate may volunteer salary information, and the law explicitly allows employers to discuss and negotiate compensation. Once a job offer (including the terms of compensation) has been extended and accepted, the employer may inquire about the applicant’s salary history, but it may not use the information to make pay decisions.
If an employer contracts with an outside recruiter who violates the law, it won’t be liable if it can show that it informed the recruiter of the legal requirements and gave the recruiter instructions on how to comply.
Employers that fail to comply with the new law can be sued by employees or prosecuted by the Delaware Department of Labor (DDOL). A first violation carries a penalty of $1,000 to $5,000. Subsequent violations will result in penalties of $5,000 to $10,000.
For more information on Delaware’s salary history law, see the July issue of Delaware Employment Law Letter.