The interview’s going great. You’ve knocked the hiring partner’s questions out of the park. You’ve had excellent follow-ups. You’ve managed to seem likable and you’ve developed a fantastic rapport. And then the dreaded question comes.
“How much are you making with your current firm?”
This is the one question you’re afraid to answer. Do you fudge a little, rounding up to ensure an offer is appropriately higher than what you’re currently making? If you don’t, will they use your current salary as the benchmark for an offer that’s lower than what they’re willing to pay for someone with your talents?
LexisNexis Practical Guidance Rolls Out Dedicated Practice Area for AI & Technology
The new generation of AI-related legal issues are inherently cross-disciplinary, implicating corporate law, intellectual property, data privacy, employment, corporate governance and regulatory compliance.
(Before going any further, a word of advice: Don’t lie in response to a question about your current salary or benefits. It’s a bad idea for a lot of reasons.)
If you’ve been in this situation, you know it can be uncomfortable. I think this is because it makes you feel almost powerless since in many situations the only leverage a candidate has in negotiating salary is the knowledge of what he/she currently makes. Once the hiring partner knows what you’re making, they have a good idea of what you’ll take but you don’t have any idea as to what they’re willing to pay.
Hello, unequal bargaining power.
This problem is especially poignant if you’re underemployed in your current gig. If you’re like a lot of lawyers, you may have had to take the first job you found after graduation. (Shout out to everyone from the deep recession years — I graduated in 2011 — fun times!) Or maybe you’re moving from a market with a low cost of living to a market with a higher cost of living. Or maybe you’re moving from a part-time job to a full-time one.
Legal Is Changing. And NeoSummit Is Where The Future Is Being Built.
Legal and operational leaders are gathering May 6–7 in Fort Lauderdale to confront the questions the industry hasn't answered—with a keynote from Amanda Knox setting the tone.
In any event, even if you’ve developed some great chops and are an excellent candidate for whatever job you’re interviewing for, unless you’re interviewing with a Biglaw firm that’s lockstep or something similar, the price tag to hire you may very well drop. Maybe by a lot.
This is not a problem that’s unique to attorneys. This is basically a problem for everyone.
Many argue that this problem is particularly bad for women and that salary questions tend to perpetuate pay inequality. This is because women are typically paid (sometimes significantly) less than men for the same job, especially earlier in their careers. (Current data show women make about 79 cents for every dollar men earn.) Thus, when a woman starts lower on the pay ladder than her male counterparts, if her then-current salary is always the basis for the pay in her next job, then with every new job she continues to lag behind her male colleagues.
In case you haven’t heard, the pay equity movement has become kind of a big deal recently. A lot of folks are pushing for legislation that will help remedy pay inequality. One type of such legislation are laws that ban salary questions during the hiring process.
The following jurisdictions have enacted laws banning these types of questions: California, Delaware, Massachusetts (effective July 2018), Oregon, Puerto Rico, New York City, Pittsburgh (city agencies only), and New Orleans (city agencies only). There’s also a bill floating around the Maryland legislature.
A recent case from the Ninth Circuit follows this trend. In Rizo v. Yovino, the court, en banc, reversed its prior panel decision by holding that the defendant-employer couldn’t use the female employee-plaintiff’s earlier salary alone as a basis for her salary. The employer in the case set new hire salaries by applying a five percent increase to their most recent salary. No other factors were used and this formula was applied to every new hire, regardless of gender or prior pay.
The employee (a math teacher) moved from Arizona to work for the employer, the Fresno, California, school district. Since her pay was significantly lower in Arizona than it would have been had she been previously working in California, her starting pay in Fresno was significantly lower than her male counterparts who were doing the same work with the same background and qualifications.
She sued the school district under the Equal Pay Act, arguing that the district’s method for calculating starting pay violated the Act because it perpetuated pay inequality for women. The district argued it didn’t violate the Act since gender was not a factor — the five percent increase applied across the board to all new hires. The court initially sided with the district, but reversed course in its en banc decision.
“It is inconceivable,” wrote Judge Reinhart for the majority, “that Congress, in an Act the primary purpose of which was to eliminate long-existing ‘endemic’ sex-based wage disparities, would create an exception for basing new hires’ salaries on those very disparities….”
I think that banning questions about prior salary is a trend we’ll likely see continue. My bet is that we’ll continue seeing more state and local legislation on this issue in the coming months and years. Maybe we’ll see an end to the dreaded salary history question everywhere in the not-too-distant future.
Evan Gibbs is an attorney at Troutman Sanders, where he primarily litigates employment cases and handles traditional labor matters. Connect with him on LinkedIn here, or e-mail him here. (The views expressed in this column are his own.)