A new wage equity law bans New Jersey employers from asking job applicants about their salary histories. Lieutenant Governor Sheila Oliver signed the bill into law, saying that she’s “proud to sign this bill today for our women, children and families, which will institute this policy as state law, and put an end to this discriminatory workplace practice once and for all.”
Proponents of New Jersey’s wage inequity law believe it will help to narrow a gender wage gap that they say results in female employees (full-time and year-round) being paid 82 cents on the dollar that similarly employed men receive in the state.
Employers who violate the new law face a $1,000 civil penalty for a first offense. Employers who ask applicants for salary or wage histories a second time face a $5,000 fine. After that, offenses will cost employers $10,000 each.
Assemblyman Dan Benson says “a woman working full time, year-round earns $10,800 less per year than a man, based on median annual earnings,” adding that the new law “can help us continue to bridge the gap.”
Similar measures have been put in place in New York City, Philadelphia and Massachusetts, according to a recent news report. The New Jersey law has in it examples of exceptions and permitted activities, including:
- Employers with operations outside of New Jersey can ask about salary history, but must make it clear that applicants who will work in the state do not have to answer.
- If job applicants voluntarily disclose wage history, the employer can verify the information and use it to determine pay.
- The law doesn’t apply to internal promotions or transfers.
- Employers can discuss with applicants terms and conditions of incentive and compensation plans with previous employers.
If your business will be affected by this change in law, contact a Morristown law firm to discuss current recruiting and hiring practices and compliance with the new law.