A ban on employers asking job candidates for salary history, as recommended in the Sexism in the City report, has already helped narrow the gender pay gap in the USA.
Eleanor Rowswell, partner at Farrer & Co, said that research on states in the US that have adopted a similar salary history ban have shown progress on reducing the gender pay gap.
“Asking for salary history – and basing salary offers on that information – risks perpetuating historic pay gaps and particularly discriminates against women, ethnic minority groups, and people with disabilities,” she said.
“Salary history bans have been adopted in the United States, and research there shows that the gender pay gap has reduced in states who have adopted these bans.”
The state of Massachusetts brought in such a ban in 2016 and research published by Boston University in 2021 found that nearly a quarter of private-sector workers in the US are now covered by a salary history ban.
In 2022, the US-based Institute for Women’s Policy Research found that the bans reduce the gender pay gap by 4.2% points in hourly wages, and by 4.5% points in weekly earnings. It published its findings in a policy briefing titled Equal Pay Policies and the Gender Wage Gap.
Rowswell said that more generally, non-financial misconduct and in particular sexual harassment is being taken more seriously by firms. In the current environment, complaints are more likely to be raised, escalated and investigated.
Non-disclosure agreements are still commonly used in settlements when an individual leaves a firm, she said, adding that “in some – though by no means all – cases [NDAs] are desirable for all parties, including the victim of harassment”. Victims may want the allegations they have raised to remain confidential, she said.
“In any event, NDAs will not override a firm’s regulatory obligations to provide a regulatory reference and, where appropriate to, disclose misconduct to a new employer.
“This means that hiring firms will be aware of any findings of misconduct before taking on new staff.”
If an employer still chooses to hire the individual, Rowswell said they would be “would be well-advised to ensure that the individual undertakes appropriate training to address any concerns that may have been flagged in the reference”.
She said that in addition to the Sexism in the City report recommendations, firms need to be aware of new legislation coming into effect in the Autumn. This will “impose a duty on employers to take reasonable steps to prevent sexual harassment of employees in the workplace”, she explained. “This will require organisations to take proactive action to reduce the risk of sexual harassment occurring in their workplace.”
