New Year & New Law: Hawaii’s Ban on Prior Salary History Goes into Effect on Jan. 1st

On January 1, 2019 at the stroke of midnight, Hawaii joined a growing list of states and municipalities to ban prospective employers from asking applicants about their prior salary history.  As we have previously reported, several other jurisdictions have already passed similar laws that place restrictions on salary history during the application process, including California, New York City, Westchester, and Suffolk County, New York.

The new law, Senate Bill 2351, was signed by Governor David Y. Ige on July 5, 2018.  The introductory section of Senate Bill 2351 lists the legislature’s rationales for passing the law.  The relevant section states, in part, that “The legislature believes that the ability of employers to consider a job applicant’s previous salary history is a contributing factor to the gender pay disparity.”  The section further cites to New York City’s 2017 passage of similar legislation as a model to follow to “promote equality in the workplace and [to] close the pay gap between men and women.”

Senate Bill 2351 applies to all employers who employ at least one employee in the state. The following is a list of key features of the law:

  • Employers are prohibited from inquiring about an applicant’s salary history;
  • Employers are prohibited from relying on salary history in determining the applicant’s compensation, unless the applicant voluntarily discloses their salary history;
  • The law does not apply to current employees who apply “for internal transfer or promotion with their current employer”; and
  • Inquiries about an applicant’s expectations with respect to “salary, benefits, and other compensation” are permissible;
  • “Objective measure[s] of the applicant’s productivity, such as revenue, sales, or other production reports,” are permissible.

We will continue to post developments as other jurisdictions consider passing similar legislation.