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New state law prohibits employers from asking applicants about salary history

10/11/2019, 2:40 p.m.

A new law requires Illinois employers to review their recruiting and employment practices. Effective now employers cannot ask applicants or their former employers about salary history.

The law amends the Equal Pay Act of 2003, which made it illegal to discriminatorily pay employees on the basis of sex or race. The impetus behind the new salary history amendment is an effort to close the gender wage gap. According to a news release from the governor's office, women in Illinois earn 79 percent of what men earn.

Several other states and municipalities have implemented similar laws that ban salary history inquiries. California adopted a similar statute several years ago. San Francisco and Philadelphia are among the cities with ordinances.

In addition to making it unlawful for employers to seek salary history information from applicants, the new law also protects employees' rights to discuss wages and benefits with others.

As a result, it is now unlawful for Illinois employers to require employees to sign a contract or waiver prohibiting them from discussing compensation with other employees.

If an employer violates these new amendments, an employee may bring a civil action within five years and seek to recover "any damages incurred," "special damages" up to $10,000, injunctive relief, costs and attorney's fees. And, employers who violate the law are also subject to civil penalties of up to $5,000 "for each violation for each employee affected."

In light of these amendments, what sort of salary information may employers discuss with applicants? The law carves out certain information employers can still provide and discuss with applicants.

First, employers can provide information about the wages, benefits, compensation, or salary offered in relation to a position. Second, they can discuss with an applicant her or his expectations with respect to wage or salary, benefits, and other compensation. Applicants are free to voluntarily disclose their current or prior wage or salary history, so long as the employer does not consider that information when making employment or compensation decisions.

In the coming weeks, employers may wish to review their application forms and retrain recruiters and other personnel involved in the hiring process to remove any questions eliciting salary history information. Additionally, employers should review their handbooks, policies, and employment agreements to ensure they do not prohibit employees from discussing compensation information with other employees.

Employers can however ask applicants for their salary and benefit expectations if hired:

Nothing in subsections (b-5) and (b-10) shall be construed to prevent an employer or employment agency, or an employee or agent thereof, from:

(1) providing information about the wages, benefits, compensation, or salary offered in relation to a position; or

(2) engaging in discussions with an applicant for employment about the applicant's expectations with respect to wage or salary, benefits, and other compensation.

So, check your internal policies and employment application documents, and as you use an employment agency, make sure its policies are changed as well.

And, as always, check with your own lawyer to verify you are in compliance.