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San Francisco’s Consideration of Salary History Ordinance

San Francisco’s Consideration of Salary History Ordinance (the “Ordinance”) takes effect on July 1, 2018. The Ordinance in certain respects mirrors California’s Labor Code section 432.3, which went into effect on January 1, 2018.

Section 432.3 prohibits both public and private employers from relying on salary history information of an applicant as a factor in determining whether to offer employment or the amount of pay. It also prohibits employers from seeking salary history information about an applicant, either directly or indirectly. Section 432.3 also requires an employer to provide the pay scale for a position to an applicant upon a reasonable request.

The Ordinance prohibits employers from (1) asking applicants about their current or past salary, or (2) disclosing a current or former employee’s salary history to a prospective employer without that employee’s written authorization, unless the salary history is publicly available, required by law, or subject to a collective bargaining agreement.

Under both laws, an employer may consider salary history if the employee voluntarily and without prompting discloses it. Further, the Ordinance permits employers to “engage in discussion” concerning the applicant’s “expectations” about salary, including unvested equity, deferred compensation, or bonus that an applicant would forfeit or have canceled by virtue of the applicant’s resignation from their current employer. However, no similar provision exists under Section 432.3.

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