Question: We have
always verified a candidate’s previous salary history early on in the hiring
process. Usually we ask for a copy of a
pay stub or a copy of the candidate’s previous year’s tax filing. Is there any problem with that practice?
Answer: We don’t recommend
this practice. First, a pay stub and/or
tax return contains revealing information that an employer shouldn't
have pre-hire, such as age, number of dependents, marital status, social
security number, garnishments, miscellaneous deductions on pay stubs, other
deductions on taxes (think medical costs, child care, etc.). Obtaining
this information post-hire is acceptable but not pre-hire.
In addition, a few cities and states have moved to
prohibit employers from asking for previous salary information altogether and
even more prohibit asking for W-2s & tax returns. The main reason for
these laws is for equal pay reasons. People (mainly women) who were
underpaid at previous jobs cannot find pay equality if future employers know
what they made before and base their offer on that information. Asking
for salary history perpetuates inequitable pay.
Instead, we recommend companies focus on what they
want to pay for the position and make sure they offer the same regardless of
sex, age, etc.