Governor Signs AB 168 Prohibiting Employers From Considering Salary History When Hiring

On October 12, 2017, California Governor Jerry Brown signed AB 168.  This new law, which becomes effective on January 1, 2018, will prohibit all employers in California from asking about, or relying on, an applicant’s prior salary history when deciding whether to offer a job and how much to pay.  AB 168 will supplement California’s existing Fair Pay Act which already forbids California employers from using prior salary, by itself, to justify any pay disparities between or among employees.

However, AB 168 will create one important exception — namely, that employers will be allowed to rely on an applicant’s prior salary history when setting the applicant’s starting salary when the applicant “voluntarily and without prompting” discloses his/her prior salary history.

Finally, AB 168 will make California the first state in the country to require employers to provide applicants, upon request, with the “pay scale” for the open position.

AB 168 will add a new section 432.3 to the California Labor Code.  You can read the full text of AB 168 here.