An amendment to the Illinois Equal Pay Act signed by the governor this week prohibits employers from asking job candidates about salary history, a change that goes into effect at the end of next month and could make finding the most qualified applicant more difficult for small- to medium-sized businesses in Illinois.
The head of the Illinois Chamber of Commerce called the new law burdensome to business owners. Todd Maisch, president and CEO of the Illinois Chamber of Commerce, said the law won’t do much for job applicants and creates challenges for business owners.
“We don’t think it really provides much protection at all for job applicants, but it does create more liability for employers,” Maisch said.
Small- to medium-sized businesses could be most impacted. Maisch said the new law adds additional liability to the smaller businesses that don’t have human resources staff to address additional regulations.
The new law takes effect at the end of September. It bans employers and employment agencies from asking about applicants’ past wage and compensation history. It also prohibits “using such information to screen candidates for a job.”
Some employers ask about salary history to weed out applicants who might not be interested in a position because it doesn’t pay enough. Maisch said eliminating the question could add more time to the hiring process.
“If somebody is making a lot more money than you can pay currently, then you know it’s just not going to work out in the end,” Maisch said.
Extra time in the hiring process costs businesses money. The extra time also could mean losing out on qualified job applicants.
The Illinois Department of Labor said the idea behind the law is to “break a cycle where predominantly female and minority workers have received lower pay for performing the same or similar work as male and non-minority workers,” according to a statement.
There are a few exceptions to the new law. According to the Illinois Department of Labor, the law does not apply if “the applicant’s salary history is a matter of public record or if the applicant is a current employee applying with the same employer.” Also, the law does not forbid an employer from asking what salary the applicant would like to make.
The new law is an amendment to the 2003 Illinois Equal Pay Act.