Even though employers shouldn’t be asking and prospective employees shouldn’t be disclosing, the practice of asking for a candidate’s salary history is still common.
In yet another example of the wage gap, according to a study from PayScale, Inc. women who decline to provide information about their salary history end up getting paid less for doing so — as punishment, perhaps? Whatever the reason, women who don’t give a salary history when asked earn 1.8 percent less than those who do provide it.
Compared with the male candidate, who, if he refuses to fork over the information, is offered 1.2 percent more.
While 43 percent of job candidates are asked for a salary history during an interview — and this despite the fact that many states and cities have passed laws or have pending legislation banning employers from asking — only 23 percent of those who are asked refuse to provide it. Prospective employees, naturally enough, are reluctant to refuse, despite the fact that answering that question could “suppress their salary for the duration of their career,” according to PayScale.
Interestingly, the more senior the position, the more likely a candidate is to be asked about salary history, and the less likely he or she is to provide it. Boomers are more likely to refuse, while millennials are more likely to cave. And in Boston, where the salary history question will be illegal in 2018, the rate of refusal (30 percent) is highest, while in Chicago, the rate of refusal is lowest at just 16 percent.
In a statement, Lydia Frank, vice president of content strategy at PayScale, says “there are real dangers in using a previous pay number to determine a current offer.”
Frank adds, “The best way to set pay is to use market data and to ensure the offer is consistent with the company’s compensation philosophy and practices. In the long run, if compensation is misaligned with the talent market, the employer ends up with pay inequities that are not defensible, employees feel unfairly treated and talent retention becomes a critical problem.”
Companies should stop asking the question, says PayScale, and price the job, not the person. Women, for their part, should make sure they know the current market value of the job they’re applying for before they start negotiating salary, and should not let themselves be negatively by a low previous salary.
“We were surprised to see the data pertaining to the gender pay gap which shows that refusing to provide salary history doesn’t improve the odds of fair pay for women but, in fact, has a negative impact,” Frank continues.
“While we don’t know exactly why this is the case, other studies on unconscious bias show that women pay a ‘social cost’ when they advocate for themselves in negotiation situations, because it deviates from expected gender norms. In this instance, managers or recruiters may be reacting differently when women and men refuse to disclose salary history when asked.”
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