Toledo, Ohio is the latest jurisdiction (and the second city in Ohio) to enact a law that will prohibit employers from asking job applicants about salary history.
The ordinance, which is scheduled to take effect on June 25, 2020, will apply to employers with fifteen or more employees in Toledo, and will prohibit such employers and their agents from:
- inquiring about the salary history of an applicant for employment;
- screening applicants based on their current or prior wages or other benefits or compensation, or requiring that salary history satisfy minimum or maximum criteria;
- relying on salary history in deciding whether to extend an offer of employment, or in determining the salary, benefits, or other compensation for an applicant during the hiring process, including the negotiation of an employment contract; and/or
- refusing to hire or otherwise retaliating against an applicant for not disclosing his or her salary history.
In addition, upon the reasonable request of an applicant who has received a conditional offer of employment, an employer will be required to provide the pay scale for the position.
For purposes of the ordinance, “applicant” is defined broadly to mean any person applying for employment to be performed within Toledo or whose application, in whole or in part, will be “solicited, received, processed, or considered in the City of Toledo, regardless of whether the applicant is interviewed.” “Salary history” means an applicant’s current or prior wages, benefits, or other compensation, but does not include any objective measure of the applicant’s productivity, such as revenue, sales, or other production reports.
While the term “inquire” includes oral or written requests as well as searches of publicly available records, employers may verify an applicant’s non-salary related information or conduct a background check, so long as they do not consider or rely upon any salary history information that may inadvertently be obtained.
Notably, the ordinance’s prohibitions do not apply to “voluntary and unprompted” disclosures of salary information by applicants. The ordinance further permits employers to engage in discussion with applicants about their expectations with respect to compensation, including but not limited to unvested equity or deferred compensation that may be subject to forfeiture or cancellation.
The ordinance also excludes from coverage: (1) applicants for internal transfer or promotion; (2) positions for which compensation is determined pursuant to collective bargaining; (3) actions taken by an employer pursuant to any federal, state or local law that specifically authorizes the reliance on salary history to determine an employee’s compensation; and (4) former employees who are re-hired by the same employer within five years of termination, provided that the employer already has any past salary history information regarding the applicant from the individual’s previous employment.
Applicants alleging a violation of the ordinance will have a private right of action. Available remedies will include compensatory damages and attorney’s fees and costs.
In advance of the June 25, 2020 effective date, employers in Toledo should begin taking steps to ensure compliance by training human resources and other relevant personnel on these new requirements.