New York Enacts New Laws Expanding Protections Against Wage Discrimination

Governor Andrew Cuomo recently signed two bills into law which provide increased protection against pay discrimination for New York employees. 

Expansion of New York’s Equal Pay Law

The first law (S5248) increases employee protections against wage discrimination under New York’s equal pay law.

Before this law was passed, the New York equal pay law prohibited an employer from paying an employee a lower wage rate compared to another employee of a different sex at the same establishment, if the employees were performing equal work: (1) the performance of which required equal skill, effort and responsibility; and (2) which was performed under similar working conditions.  

Under this new law, which took effect on October 8, 2019, employers are prohibited from paying employees a lower wage rate based on “protected class status” (as opposed to only discrimination based on sex).  “Protected class” is defined to include age, race, creed, color, national origin, sexual orientation, gender identity or expression, military status, sex, disability, predisposing genetic characteristics, familial status, marital status,  domestic violence victim status, or any other protected characteristic under the New York State Human Rights Law. 

This new law also expands the group of employees at the same establishment against whom a comparison is made to determine if an unlawful wage disparity exists.  Indeed, in addition to comparing an employee’s wages against those employees at the same establishment “without status within the same protected class or classes” who are performing equal work, an employee’s wages are also compared against the wages of employees at the same establishment “without status within the same protected class or classes” who are performing “substantially similar work, when viewed as a composite of skill, effort, and responsibility, and performed under similar working conditions.” 

This new law retains the exceptions in the prior law, which permits an employer to pay a differential wage rate to an employee if the differential is based on: (1) a seniority system; (2) a merit system; (3) a system which measures earnings by quantity or quality of production; or (4) a bona fide factor other than status within one or more protected classes, such as education, training, or experience.[1]

Salary History Inquiry Ban

The second law (S6549) bans New York employers from making certain inquiries about salary history and using such information to support their decisions. 

Indeed, under this new law, employers cannot:

• “[R]ely on the wage or salary history of an applicant in determining whether to offer employment to such individual or in determining the wages or salary for such individual.”
• “[O]rally or in writing seek, request, or require the wage or salary history from an applicant or current employee as a condition to be”: (a) interviewed; (b) continued to be considered for an offer of employment; or (c) employed or promoted.
• “[O]rally or in writing seek, request, or require the wage or salary history of an applicant or current employee from a current or former employer, current or former employee, or agent of the applicant or current employee’s current or former employer.” An employer may, however, confirm wage or salary history if “at the time an offer of employment with compensation is made, the applicant or current employee responds to the offer by providing prior wage or salary information to support a wage or salary higher than offered by the employer.”
• “[R]efuse to interview, hire, promote, otherwise employ, or otherwise retaliate against an applicant or current employee”: (a) based upon prior wage or salary history; or (b) because such applicant or current employee did not provide wage or salary history as allowed by the new law.
• “[R]efuse to interview, hire, promote, otherwise employ, or otherwise retaliate against an applicant or current or former employee because the applicant or current or former employee filed a complaint” with New York State Department of Labor asserting a violation of this law.

Notably, this new law does not supersede any federal, state or local law enacted prior to the effective date of the law which requires the disclosure or verification of salary history information to determine an employee’s compensation.  Additionally, this law does not prevent an applicant or current employee from voluntarily, and without prompting, disclosing, or verifying wage or salary history, including for the purposes of negotiating wages or salary.

An applicant or current employee asserting a violation of this law may file a lawsuit in court to obtain damages, injunctive relief, as well as reasonable attorneys’ fees.   

This law will take effect on January 6, 2020.  

Next Steps

In light of these new laws, New York employers should:

• Review their current practices for setting employee wage rates to ensure that they are making decisions about employee wages consistently with their obligations under the expanded Equal Pay Law.
• Review their interview policies and practices and relevant hiring materials to ensure that they comply with the new ban on inquiries about, and use of, information concerning, an employee’s prior wages.
• Train managers, supervisors, and any other individuals responsible for wage or hiring decisions regarding the protections under these new laws.

Additionally, with respect to salary history inquiries, New York City employers should also be mindful of New York City’s law banning similar salary history inquiries, which was passed in 2017.  See https://www.kmm.com/articles-492.html.

Please do not hesitate to contact any of our attorneys if you have any questions.

[1] Such bona fide factor shall not be based upon or derived from a differential in compensation based on status within one or more protected classes, and must be job-related with respect to the position in question and shall be consistent with business necessity.  This exception, however, will not apply if the employee demonstrates that the employer’s practice creates a disparate impact, “that an alternative employment practice exists that would serve the same business purpose and not produce such differential,” and “the employer has refused to adopt such alternative practice.”