Does Asking About Prior Salary Create Potential Liability?

Arizona Employment Law Letter
Employment & Labor Law

The Equal Pay Act (EPA) makes it illegal for employers to pay unequal wages to men and women who perform substantially equal work. It allows for differences in pay, but sex cannot be a factor. An employer can justify a pay disparity by proving the disputed wages are based on one of four affirmative defenses in the statute:

  1. A seniority system;
  2. A merit system;
  3. A system that measures earnings by quantity or quality of production; or
  4. Any factor unrelated to sex.

Historically, employers have made it a practice to ask job applicants for prior salary information. Is there a connection between the EPA and questions about an applicant’s salary history? Isn’t prior salary a factor unrelated to sex? For more than three decades, the answer was yes. But even though requesting salary history is a seemingly innocuous request, the question can perpetuate gender pay gaps among employees.

Read more from Jodi Bohr about whether asking about prior salary creates potential liability.