Thorny Questions: Salary History
At the end of this month, New York City will join Philadelphia and Massachusetts in the list of places where it is illegal to ask about an applicant's prior salary. Indeed, there are a number of places throughout the country that are considering similar legislation as well, all aimed at helping to narrow the gender wage gap. I've written and studied quite a bit about the subject, and you can find more information about it in some of my blog posts, on this page.
Employers, for you this is a very simple change - don't ask an applicant how much they are making in their current job during an interview, nor about their salary in their previous roles. Make sure your application doesn't have a space for salary in the work history section, both the printed and electronic versions, if applicable. When I describe this to my clients, the question I most often get revolves around how an employer should know how much to pay someone for the open position.
If the first time you are wondering how much you should pay the person is when you are ready to make the offer, or during the application process, you're already making a mistake. In any negotiation, the more information you have, the better position you will be in. You should already be doing some research to find out what the range is in your area for a person with the experience and skills needed to perform the duties of the position. There are a few free solutions to do this, and some paid ones, and rest assured, your applicants are using them, too (subscribers, you'll be getting my list of tips and tricks at the end of the week).
You should have also decided on what your overall pay strategy is. You can't just pay as much as you can afford to get the best person for the job. It's not a sustainable strategy. There will always be another shop that will pay more for that person (unless you are the heaviest hitter in town). Even if you could, salary has diminishing returns. Eventually the pay starts to become outweighed by the quality of the manager, the culture of the company and the development opportunities. You need to be sure that you're presenting all the great reasons someone wants to work at your company, and choose a pay strategy that matches your capability to pay in the long term.
Employees, you should be evaluating all of these things during the interview, as well. Nothing is worse than going on the hunt for your next great job and finding out three months in that you've made a mistake. I've seen it happen far too often that a very lucrative role was offered to someone who just wasn't a cultural fit for the company, but the compensation was just too good to turn down. Their mercenary attitude got them a significant payday, but going in to a job every day that they couldn't feel good about got old very quickly. Then they had the dual dilemma of finding a job they liked better, and metabolizing a pay cut.
Back to the salary history question. What happens if you're in an interview and someone asks you? If you're in one of the places where it is newly improper to ask, you don't have to answer it, of course, but you should still tread carefully. Here's my recommended line: "I'd prefer to talk about the compensation package that you're offering when an offer is made." It does two things: it shifts the discussion of money onto the company, rather than your salary, and it places the conversation later down the road. If they insist, then politely remind them of their new obligation by saying, "As you know, it recently became impermissible to ask this question, so I'd prefer not to answer." It's your right not to answer, and if you're at an employer where they won't let it go, that's not an employer you're going to want to work with in the long term. They're going to treat you like a commodity, not a valued part of their workforce.
If you are not fortunate enough to be in an area where it is illegal to ask this question, I still firmly believe you should protect your salary history information. Just as I said before, the power in a negotiation goes to the well-informed, and it would be absolutely foolish to give away all your power by showing your hand right off the bat. I've been in an interview where the recruiter absolutely insisted that they had to know what my salary was in order to proceed, because it was the company's policy. They even threatened me that if I lied to them, they would find out, and it would disqualify me from further consideration.
If any company, or any person, ever treats you that way, get up out of your chair without another word and walk out of that interview. Do not stay another minute. You don't deserve to be treated that way. You have value, and you don't want to work for an organization that's going to treat you as if you were nothing but a worthless cog in a faceless machine. Demand better for yourself. We must all demand better. And if you are a recruiter who treats people that way, shame on you.
Time for you to weigh in - how have you handled this question? What do you think of these new laws?