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Don’t ask about salary

There are many reasons for the gender pay gap that exists in America, but politicians in New York and elsewhere recently have taken steps to address one issue that can prevent women from catching up to their male counterparts in pay: salary history.

Gov. Andrew Cuomo this year signed an executive order that prohibits state agencies from inquiring about a job applicant’s salary history. New York City Mayor Bill de Blasio issued the same prohibition for city agencies in November. Last August, Massachusetts banned all employers from making salary inquiries, and similar bills have been introduced in several other cities and states.
The thinking behind such policies is that if a woman has already fallen behind her male counterparts in salary, then inquiring about her salary when she applies for a job will increase the likelihood that she receives an offer with a lower salary than her higher-paid male counterpart would receive, even if they are equally qualified. After all, a company knows it does not need to offer her as much to compete with her old salary as it needs to offer her higher-paid male counterpart.
The New York State and New York City orders only apply to public agencies, but it is likely that these mandates will be extended to the private sector at some point, which would help New York continue to be a leader in pay equality. The American Association of University Women’s latest analysis shows New York had the smallest pay gap in the country in 2015, with women making 89 percent of what men were paid.
These requirements may lead to an increase in businesses’ payrolls, but it is worth it if they contribute to a decrease in wage inequality. What’s more, if employees feel that they and the job they are doing are valued more highly, it may lead to an increase in productivity, motivation and loyalty. So the higher upfront costs ultimately could be good for companies’ bottom lines, employee satisfaction and gender fairness.
3/3/2017 (c) 2016 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email rbj@rbj.net.

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