What You Can’t Ask a Job Candidate
Progressive big cities often seem to be competing to be the most hostile business environment, and Philadelphia has taken the lead with a new law prohibiting employers from even asking about a job candidate’s wage history. The city’s Chamber of Commerce fought back this week with a suit to block the law as an unconstitutional restriction on employers’ free-speech rights, and employers elsewhere may want to take notice.
In January Philadelphia passed an ordinance that bars employers from asking job applicants about their prior compensation unless the prospective employee “knowingly and willingly” divulges the information. The city council is worried that women earn less than men, and progressives say employers may perpetuate this disparity by asking about an applicant’s wage history. Employers that ask the new unmentionable could incur civil and criminal penalties including $2,000 per violation and 90 days in jail for repeat offenses.
One problem is that discussions about compensation are a normal part of the give-and-take between employers and prospective hires. Employers might ask about an applicant’s wages to screen out the overqualified or to know the compensation it will take to lure new talent. Headhunters use salary histories to recruit executives and high-level professionals from other firms.
Yet the Philadelphia law abridges the speech of only one party at the negotiating table—the employer. Job applicants are free to ask how much the employer typically pays its workers. Research indicates that men are more likely than women to initiate negotiations about compensation, so the Philadelphia law could even have the perverse effect of increasing gender wage disparities.
A bigger legal issue is that government restrictions on speech must be narrowly tailored to meet a compelling interest. But as the Chamber’s lawsuit brought by attorney Miguel Estrada notes, the Philadelphia ordinance targets speech that is “only tenuously and indirectly related to perpetuating possible effects of past discrimination.” The city could have taken a narrower approach—for example, by barring employers from basing compensation solely on prior wages.
Philadelphia’s ordinance also applies broadly to any employer that “does business” or “employs one or more employees” in the city. So Amazon could conceivably be prohibited from inquiring about a Seattle computer programmer’s wage history because the company delivers items in Philadelphia.
Federal courts have sometimes deferred to state efforts to regulate out-of-state businesses operating within their borders, but the Philadelphia ordinance goes a step further by controlling conduct that occurs entirely outside of the city’s jurisdiction. This arguably violates the Constitution’s Commerce Clause, which the Supreme Court has held “precludes the application of a state statute to commerce that takes place wholly outside the State’s borders.”
Liberals have perpetuated the conceit that women earn less than men because of discrimination, but the reality is more complex. Women sometimes trade higher pay in return for flexibility at work or take time off to raise children. Research shows that most gender wage disparities reflect education or experience or factors other than discrimination.
The Philadelphia fight is part of a larger trend by state and local governments to restrict speech in pursuit of political goals. Similar laws are under consideration in New Jersey, Virginia, Pittsburgh, New Orleans and Washington, D.C., among other places. If the courts bless Philadelphia’s ordinance, employers around the country may soon have one more barrier to hiring the best workers for the job.
Appeared in the Apr. 08, 2017, print edition.