Starting in January of next year all private employers and contractors in the state of New Jersey are banned from demanding job applicants to spell out previous salary and wages when they are being considered for full-time employment. What that means is that this new legislation will make it a felony for private employers to filter prospective employees bases on their previous salary and/or wage history. The new law also prohibits prospective employers from using previous wages or salary as a basis for offering new employment.
This new legislation is still riddled with loopholes that employers can use to get around the proscription against investigating previous salary amounts. For example, a prospective employer may consider an interviewee’s wage history, but only if the employee will waive his or her right to privacy in the matter, without any coercion on the part of the prospective employer. This is done through a written statement by the prospective employee that he or she was in no way, shape, or form, prompted or forced to give said authorization in order to be considered for employment. According to the bankruptcy lawyers at Scura, “There is also a loophole that lets potential employers ask about previous compensation packages, including insurance coverage, retirement packages, and bonus structure, if any.” If and when previous salary/wage history is accidentally discovered during a benefits search it is up to the employer to delete such information and not use it for any consideration of employment, or offer of employment.
Also excluded from this new ruling are all city, county, state, and federal employers who can show a ‘need to know’ requirement for an applicants previous wage or salary history. Although most of the public safety unions in New Jersey, such as police and firefighters, lobbied against this exception, it was passed almost unanimously once the Governor weighed in on the side of transparency for all state employees.