If you work in human resource or are a hiring manager, you are accustomed to asking for salary requirements. It helps the company to make sure the applicants fit within the company budget and confirm the value of experience and skill of the applicant.

However, due to gender inequality in regards to pay, some states governments put up laws banning employers from asking for salary requirements from their applicants. What does this mean for employers and HR? What does the salary history ban entail?

Purpose of the Salary History Ban

A salary history ban was set up to help fix inequality in gender pay. For a long time, it has been illegal for HRs to offer different wages to women and men completing the same tasks. But even then, there is still a huge salary disparity between them. As of 2016, women made only 82% of what men earned for the same jobs. The gap was even larger for women in minority groups. The salary history ban was set up to put an end to this.

What Does a Salary History Ban Entail?

This ban prevents an employer from asking applicants about current or past wages and benefits. The ban also prevents an employer from getting the information from a different source.

But this does not mean that you cannot ask applicants to disclose salary requirements or their expectations for the job. As an employer, you can still use salary expectations to weed out applicants who aren’t best suited for the position or that you cannot afford to have on board. Moreover, if the applicant volunteers base salary requirement, you can use the information in deciding the hire.

Salary requirement statement

At this point, we’ve ascertained that this question is limited to expectations and not cover any history. So now the question is, how should an applicant respond to an employer’s salary requirements of job candidates? Below are some factors applicants can consider before quoting a price range.

• Geographic location – the cost of living heavily affects the salary range you quote. For instance, if the job position is in New York City, you will quote a higher range than if you applied for a similar role in Oklahoma.
• Education – it goes without saying that an applicant with higher qualifications demands higher pay. However, in this case, you need to pay attention to the employer’s requirements. If they don’t explicitly state the education level, they probably don’t have a high budget for the position.
• Experience – more years of experience in a given role translates to a higher more lucrative compensation package.
• Career level – as you move up the ladder, your salary requirements will increase as well. For instance, if you have experience as a manager, you will quote a higher salary range than when you did for an entrant job position.
• Skillset – if your skills are in high demand in the industry, you can quote a high salary. This is the law of demand and supply. This often applies to skills in the Fintech industry or being fluent in multiple languages.

When drafting a salary compensation letter, exude confidence but also let the employer know you can negotiate pay to an extent. Always do your research ahead of time so that you make an accurate quote.