Asking job candidate about prior salary helps employer set competitive wage in tight job market
PHILADELPHIA, NOV. 28, 2018 – NFIB, an association representing over 12,500 small businesses in Pennsylvania, the Pennsylvania Chamber of Business and Industry, and the U.S. Chamber of Commerce filed an amicus brief today in a federal appeal, Chamber of Commerce of Greater Philadelphia vs. City of Philadelphia. The plaintiff in the case, the Philadelphia Chamber, challenged an ordinance passed by that city barring employers from asking job candidates about their salary history.
“The ordinance was framed as a way the city could go further than current state and federal equal pay laws, but it put a stranglehold on small business owners trying to determine what constitutes a competitive offer in a very tight job market,” said Karen Harned, executive director of the NFIB Small Business Legal Center. “There are less harmful ways to address pay equality without hurting small city businesses, such as encouraging employers to perform audits to determine if employees are fairly compensated for equal work.”
Before the appeal, the Federal District Court agreed with the Philadelphia Chamber, that the city’s ordinance violates the constitutional right to free speech. But the court also upheld a separate provision in the ordinance preventing employers from relying on any salary information they glean about an applicant’s pay history.
The friend of the court brief filed with the Third Circuit Court of Appeals by NFIB and the state and national Chamber today asks the court to hold that the city’s ordinance is unconstitutional. The brief urges the appeals court to reverse the lower court’s decision on using salary information, arguing that in practical effect, that too is a violation of free speech.
“The ordinance creates complexity, additional cost, and further burdens small business owners,” added Harned. “It also opens the door for a flurry of lawsuits; even if an employer did nothing wrong, the defense costs alone could wipe out a small business.”
To read the amicus brief filed by the business groups today click here.
