The Governor of IL signed a bill that updated the Equal Act Pay of 2003 and prohibits employers from paying employees different wages due to their gender or race.
About The Bill
In 2003, Illinois implemented an Equal Pay Act to prevent wage discrimination. It stated that employers may not “discriminate between employees on the basis of sex by paying wages to an employee at a rate less than the rate at which the employer pays wages to another employee of the opposite sex for the same or substantially similar work on jobs the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions.”
House Bill 834 (HB834) updates that law and prohibits employers from paying employees who do comparable work different salaries due to their gender, race or other protected factors. To help accomplish this, HB834 prohibits employers from asking applicants about their current or previous salary. This includes all wages and other forms of compensation. The bill states that employers may not require an applicant to currently earn a specific salary level to be eligible for a position.
According to HB834, if a job seeker voluntarily discloses their current salary, the employer is still prohibited from using that information when determining what salary and other compensation to offer.
HB834 also stipulates that employees are allowed to discuss their wages with co-workers. If an employee chooses to do this, the employer may not discharge or otherwise retaliate against that person in any way. It further specifies that an individual who has access to compensation amounts for all employees may not discuss such information unless they are granted permission from each person involved.
Employers may provide varying levels of compensation for employees who do comparable work under certain circumstances. They include:
· A merit system.
· A system that measures “earnings by quantity or quality of production.”
· A seniority system.
· To accommodate the cost of living based on geographical location.
Illinois employers who violate HB834 could be subjected to penalties:
· An employee who earned less than others that do comparable work may be able to recover the amount they were underpaid.
· Employers may be liable for additional compensatory damages if they are found to have acted with malice or reckless indifference.
· Reasonable costs and attorney fees may also be passed on to an employer for confirmed violations.
Salary Bans Are Becoming Common
We’ve seen several states and cities pass laws that prohibit employers from asking candidates about their salary. The goal is always to prevent wage discrimination based on gender, ethnicity and other protected factors.
If a person is already receiving a lower rate of pay due to a discriminatory factor, that situation is likely to continue if a prospective employer bases an offer on the individual’s current earnings. Best practice is for employers to not rely on an applicant’s salary history when determining compensation, even if no law requires them to do so.
Keeping Up With Relevant State Laws
Every employer must be aware of and compliant with laws that are active where they operate. We recommend documenting your hiring and background screening policies and keeping them updated. Consult with your legal counsel to determine which laws are applicable for you.
Backgrounds Online endeavors to help educate our clients with information about new and upcoming laws. We also offer compliant forms and background check packages that can be customized based on your specific needs. When you’re ready to run background checks on applicants, contractors or volunteers, please contact us. Our highly trained staff is here to assist you Monday through Friday from 5am to 6pm PT.