Wednesday, February 21, 2018
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The Salary History Ban: What does this mean for Hiring Procedures?

Legislation Spreading Across United States to Ban Compensation History Questions from Hiring Process

Salary History Ban Trending

Trending this year on the regulatory front are state and municipal bans on interview questions regarding salary history or previous salary information. Driven primarily by efforts to curb the perpetuation of the wage gap for both minorities and women in the workplace, the banning of salary history related interview questions also bans organizations in certain areas from sharing previous salary information with other organizations.

More employers are reviewing policies around previous salary information and salary history questions during the interview and onboarding process. This part of many hiring processes is coming into focus as more areas pass legislation banning these and similar questions from employers hiring and onboarding procedures.

Many employers have taken it a step further to make new policies regarding salary history inquiry and previous employee information nationwide, or in some cases global, depending on their footprint. This relieves the burden of updating policy in certain areas as new legislature passes to ensure compliance and is in anticipation of similar bans being more widely adopted on a national and global level. However, there are other organizations making the same sweeping changes in order to embrace the motivator related to the elimination of the wage gap and its perpetuation based on previous compensation data of an individual versus the compensation that is appropriate for a position and its responsibilities.

TIMELINE OF CURRENT REGULATIONS

March 2017 - Pittsburgh banned city agencies from asking about candidates' pay history. The rule only effects city employees.
June 2017 - New Orleans banned inquiries about all city departments and employees of contractors who work for the city. The rule only impacts individuals who are interviewing to work for the city of New Orleans.
October 2017 - New York City ban on public and private employees from asking about a candidate's pay history.
December 2017 - Delaware ban on all employers from asking candidates about their salary history.
January 2018 - California ban on private and public employers from asking about a candidate's pay history
March 2018 - Puerto Rico ban on employers from inquiring about a candidate's pay history.
May 2018 - Philadelphia banned the salary history question for all employers. The rule was supposed to take effect May 23, but a judge halted it temporarily due to a lawsuit from the Chamber of Commerce.
July 2018 - Massachusetts prohibits all employers from inquiring about a candidate's pay history.
July 2018 - San Francisco bans employers from asking applicants (contractors and subcontractors included) for their compensation history. Employers also can’t disclose a current or former employee’s salary history without that person’s explicit permission.
January 2019 - Oregon ban on all employers for inquiring about a candidate's salary history.

Looking Forward

It’s expected that a minimum of 11 US states will consider passing similar legislation in 2018. Florida and New Hampshire have already drafted pay equity bills that include bans on disclosure of past salary history for consideration during their respective 2018 state legislative sessions. Many employers are creating new hiring process to exclude the practice of asking for or using past salary history during the interview and candidate selection process to get ahead of legislation that may be passed in more of the United States over the coming years.

Prompted by the growing demand for pay equality reviewing hiring processes and paperwork to see if everything is both consistent and compliant with new laws in the areas where organizations are hiring is more important now than ever. Pressure on legislators at all levels to implement pay equality inspired regulations is increasing. It’s only a matter of time before the majority of the United States and soon global markets are subject to similar restrictions.

What is next?

Review your hiring process and related documentation including applications, templates, emails and any other communications involved in the hiring process. Train existing staff who come into contact with candidates at any point during the hiring process. Refrain from releasing salary information for past or current employees to other organizations without written authorization from the employee. Review your local and state laws for any exceptions to this such as collective bargaining agreements or in cases where salaries are publicly available.

Marijuana: New State Regulations and How They Impact Company Policies

Medical and Recreational Marijuana

Adult-use recreational marijuana. This phrase has a lot of organizations examining their regulations compliance in many areas across the united states. While Marijuana is a controlled substance, according to the FDA, and the DEA, OSHA and Workers’ Compensation underwriters all support firm and consistent testing and regulation, employers are struggling with how to ensure that their cannabis policy is well-documented and legal. Terminate someone who fails a drug test but who is not under the influence at work in a state where marijuana use, whether medical or otherwise, is legal and you may find your organization facing allegations of discrimination.

Employee On-boarding Procedures

The same laws now cover employee on-boarding especially where employers drug screen as part of their hiring process prior to offering employment. Screen a candidate and deny employment based on a positive result for cannabis in a workforce market where either recreational or medical use is legal and discrimination allegations may follow. All the more reason to thoroughly review these policies and clearly state the organizations stance on use both where it is legal and illegal.

In California, for example, an employer maintains the right to disciple employees even when the use of marijuana is doctor recommended. Termination of an employee based on their use of marijuana, regardless of why they use it, does not violate the laws in this state related to workplace discrimination. Similar to policies that prohibit the use of alcohol during work hours, or appearance for work while under the influence of alcohol, organizations may have a consistent and firm no tolerance policy for marijuana.

Workplace Marijuana Policy

While some businesses, mostly creative businesses such as gaming or mobile app development or businesses that produce, distribute or sell marijuana, have no qualms with workplace marijuana use; There of a significant number of positions and workplaces where marijuana use (or being under the influence of marijuana) at work is inappropriate and even dangerous. Determining what workplace marijuana policy and implementation will look like is foreign territory for most organizations with workers in the eight states (and Washington D.C.) that have legalized marijuana use. However, these newly developed policies may set the precedence for workplace regulation and compliance for many organizations in the future as more states legalize marijuana use in 2018.

It’s important to note however, that no state laws currently force employers to tolerate on-the-job use. While Massachusetts and New York, and a few states, afford protections to registered medical marijuana users that may require employers to see if reasonable accommodations can be made in some circumstances. The majority of states do not require employers to make accommodations even for off-duty marijuana use. As these laws continue to evolve it’s crucial that employers have a clear understanding of the laws in the areas where they engage workers.

Developing Company Policy

Can I fire someone for using Marijuana at work? Can I decide not to hire a candidate because they failed a drug test for Marijuana? Can I allow medical marijuana use, but not recreational use, by my employees when they are off-duty? These are all questions that need to be answered while organizations are developing their own company policies on marijuana. This policy should also include what to do in the case of workplace use or on-the-job intoxication, which employers are not required to tolerate. If alcohol or marijuana use before or during work are not permitted there should be clear language in the company handbook stating these policies and the consequences while ensuring that the organizations policy is in compliance with states regulations.

Minimum Wages in January 2018

Minimum Wage Increases for 18 States in 2018

With minimum pay rates varying so widely across the United States and many changes coming over the next several years it is now that much more important to have a sound workforce management strategy in each location where contingent labor is engaged. In addition to wage requirements, overtime regulations and benefits requirements also vary widely from state to state throughout the US.

Many organizations inadvertently leave money on the table in states were regulations are more relaxed and/or expose themselves to risk in states were regulations are more stringent.  Whether an employer leverages remote workers, temporary labor, or makes adjustments to its geographic strategy, there are a number of ways to adjust cost management strategies in workforce planning to account for these new wage levels.

Changes in 2018

States with new minimum wages, according to the Economic Policy Institute, a think tank that tracks minimum wage legislation:

  • Alaska: $9.84, $.04 increase
  • Arizona: $10.50, $.50 increase
  • California: $11.00, $.50 increase
  • Colorado: $10.20, $.90 increase
  • Florida: $8.25, $.15 increase
  • Hawaii: $10.10, $.85 increase
  • Maine: $10.00, $1.00 increase
  • Michigan: $9.25, $.35 increase
  • Minnesota: $9.65, $.15 increase
  • Missouri: $7.85, $.15 increase
  • Montana: $8.30, $.15 increase
  • New Jersey: $8.60, $.16 increase
  • New York: $10.40, $.70 increase
  • Ohio: $8.30, $.15 increase
  • Rhode Island: $10.10, $.50 increase
  • South Dakota: $8.85, $.20 increase
  • Vermont: $10.50, $.50 increase
  • Washington: $11.50, $.50 increase

Recently, Missouri passed a preemption law to retroactively roll back a minimum wage hike enacted by city leaders in St. Louis. Under the new legislation, no locality could have a wage floor higher than the one mandated by the state. The new law effectively reversed St. Louis’ minimum wage, taking it from $10 back to the current state level of $7.70. While some believe this may become a trend nationwide there is no historical or current evidence that the minimum wage will do anything but rise going forward. cases such as St. Louis are the exception to the consistent increase of the minimum wage over time.

Minimum Wage Rates by State and Municipality

Jurisdiction Minimum Wage Rate Municipality Minimum Wage Rate
Alaska $9.84 Albuquerque, New Mexico $8.95
Arizona $10.50 Bernalillo County, New Mexico $8.85
California 11.00 (26 or more employees); Cupertino, California $13.50
$10.50 for small employers (25 or fewer employees) El Cerrito, California $13.60
Colorado $10.20 Los Altos, California $13.50
Florida $8.25
Hawaii $10.10 Minneapolis, Minnesota $10.00 for large employers (101 or more employees
Maine $10.00 Oakland, California $13.23
Michigan $9.25 Nassau, Suffolk and Westchester Counties, New York $11.00 for non-fast food employees
Minnesota $9.65 New York City $13.50 for fast-food employees;
Missouri $7.85 $13.00 for large employers (11 or more employees);
Montana $8.30 $12.00 for small employers (10 or fewer employees)
New Jersey $8.60 Richmond, California $13.41
New York $11.75 for fast-food employees San Jose, California $13.50
Ohio $8.30 San Mateo, California $13.50 ($12.00 for nonprofits)
Rhode Island $10.10 Santa Clara, California $13.00
South Dakota $8.85 Seattle, Washington $15.45 for Schedule 1 Employers
Vermont $10.50 $15.00 for Schedule 1 Employers with medical benefits
Washington $11.50 $11.50 for Schedule 2 Employers;
$14.00 for Schedule 2 Employers with minimum compensation
Sunnyvale, California $15.00
Upstate New York $10.40 for non-fast food employees

Minimum wage is only one of a dozen or more areas of compliance employers will be examining at the start of 2018. However, it is the one that usually gets the most attention. As more municipalities pass Minimum Wage legislation that is separate from their state regulations compliance with the minimum wage rules where organization have workers becomes even more difficult to maintain then ever before.

The Real Global Gig Economy and Informal Workforce Trends


2017 Total Workforce Index™

Introduction

The Gig Economy as it’s currently defined by most is composed of both informal and non-informal contingent workers. ManpowerGroup Solutions recognized that there are two unique subsets under the umbrella of contingent work, those with and those without formal contracts for employment. The true ‘Gig Worker’ is a contingent worker with no formal contract who earns compensation on a per job, or per gig, basis. In the 2017 Total Workforce Index™ we separate these two subsets of the workforce and take a closer look at the growing informal workforce and related trends.

Informal Workforce Participation

The most mature workforce market, with an informal workforce that is more than 40% of the total workforce is India. This market has 41% of the total number of workers who are engaged in work. This informal population is divided up nearly equally between the services, trade and manufacturing sectors, with the services sector claiming a slight advantage over the other two sectors.

Helping to drive this informal workforce growth is the emergence of new segments such as corporate freelancers, entrepreneurs and professional moonlighters. However the popularity of informal work isn’t limited to people who have been in the workforce and who decided to leave permanent or full-time employment or supplement those incomes. The flexibility has attracted many women seeking a work life balance that allows them the ability to continue to work or return to the workforce as a freelancer.

Creating Opportunity

Facilitating this rise in informal workers is the technology that has allowed many people to manage their own businesses. Cloud based computer, online applications and mobile applications have allowed many people to significantly reduce the time necessary to manage businesses as well as reduce employee overhead and other overhead costs associated with owning you own business.

Challenges of the Gig Economy

There are certainly many positive aspects to informal work, however, along with freedom and flexibility often requires added responsibility and long ‘unpaid’ hours needed to acquire new work and manage the day to day tasks of operating a business or being self-employed. One such responsibility is that of taxes. In the United States many informal workers are termed as ‘1099 employees’ despite the lack of contract for employment. These people are essentially independent contractors who are paid on a per job basis by other business to perform work for them. An example would be a plumper that is contracted on a job-by-job basis by a general contractor.

Contractor must provide their own insurance and register for business licenses to operate independently but they must also keep their own accounting records and pay taxes on their income out of their earnings each year. This tax liability without the withholdings and management of an HR department that is enjoyed by a permanent employee can be the quick end of some informal businesses. Employees of the growing ‘sharing’ sector which includes ride sharing and subletting among other things is no exception to the taxes imposed by the federal and state legislature governing these independent contractors.

Growing Informal Populations

Despite the challenges most mature markets feature growing informal workforces between 5-10% of the total workforce. Canada, the United Kingdom and Ireland currently have 7% of the total workforce population engaged in informal work. As the workforce regulation in these markets changes and with the shift towards automation in many low-skilled positions throughout the mature markets we may see a steady climb over the next decade in the number of informal workers due to lack of employment in positions formerly filled with a population that is aging and seeking both flexibility and low to moderately skilled work using the skills they currently possess.

The rise of the informal workforce promises great opportunity to those people in the labor force who wish to take control of their employment opportunities while assuming the responsibilities of acting as their own independent business. A small shift towards closing the gender participation gap has already begun in some markets as more women are able to continue to work or return to the workforce on their own terms. Younger generations, those who are tech savvy and more likely to trust and be comfortable using mobile apps to find and be engaged by potential employers are enjoying the opportunities afforded to them. However, there is a growing population of older and otherwise retired workers who are finding a means to supplementing fixed incomes by adapting to new technologies such as those involved with ride sharing. This gives them not only supplemental income but the ability to enjoy social interactions outside of the home.

Emerging Markets Dominated by Informal Workers

While the mature markets have embraced the informal worker, it is the emerging markets where the informal worker is dominating the contingent workforce landscape. Countries like Bolivia, Honduras and Nicaragua have informal workforce populations of 44% or more in the case of Bolivia at just fewer than 50% of the total workforce. Thailand and Vietnam feature the highest percentages in the APAC region at 42% and 43% respectively. The markets in the Americas and APAC regions dominate the top 15 markets relative to informal workforce populations.

Conclusion

The Gig Economy may be more powerful than we thought. With an estimated 34% of the workforce in the United States classified as ‘Self Employed’ or informally engaged in work analyst predict that this opportunity will grow as the popularity of these types of work soars over the next few years. Most expect the percentage of the US workforce that is made up of informal or independent contractors to increase to 43% by the year 2020. However, this number includes workers and freelancers of all kinds, everything from the ride sharing driver to the plumber or electrician hired by a general contractor technically falls under the same umbrella.

That said the shift may not be as dramatic as the numbers may imply. Many people engaged in informal work are adding this secondary income to a primary engagement that provides them not only dependable income but things like medical insurance and job security. ‘Side hustles’ or secondary sources of income are all too common among the true ‘Gig Economy’ workers whether its driving, selling crafted good using mobile apps or websites or operating small online retail stores these smaller incomes may be a necessity to add to the household budget or driven by social factors like hobbies and personal human connection.

Download the Gig Economy Feature Article

2017 Q4 North American Quarterly Market Report

ManpowerGroup Solutions provides market trends as well as insight into North American metro area contingent workforces as they evolves each quarter. Featured in this fourth quarter of 2017 are Paid Sick Leave and Overtime Requirements by State, Legislation Banning Salary History, Marijuana Laws by State, Finance and Banking candidate availability, Technology candidate availability, Telecommunications candidate availability, and Manufacturing candidate availability. Also included are regional and micro level labor statistics, like the gender wage gap and hourly pay by job title, for metro areas within the United States and Canada.

In a fast-paced, unpredictable marketplace, organizations must be able to react quickly. Today, organizations increasingly rely on the contingent workforce, such as independent contractors, temporary workers, consultants and freelancers. The contingent workforce is scalable and flexible, which provides organizations with the agility they need to remain competitive.

But as the world of contingent work evolves, how can organizations keep pace with change? The key is for organizations to consult analyst insights and data. Through the ManpowerGroup Solutions and TAPFIN Quarterly Market Reports, organizations can access market intelligence on a local, regional and global scale and determine how trends and regulations may impact worker cost, performance and availability - putting the power to gain a quantifiable advantage in their hands.

Download the complete Q4 2017 North American Quarterly Market Report.

 

2017 Q4 European Quarterly Market Report

TAPFIN provides market trends as well as insight into the European contingent workforce as it evolves across Europe each quarter. Featured in this fourth quarter of 2017 are Global Trends, European Employment Outlook statistics and Legal and Regulatory updates in countries throughout Europe as well as regional and micro level labor statistics.

In a fast-paced, unpredictable marketplace, organizations must be able to react quickly. Today, organizations increasingly rely on the contingent workforce, such as independent contractors, temporary workers, consultants and freelancers. The contingent workforce is scalable and flexible, which provides organizations with the agility they need to remain competitive.

But as the world of contingent work evolves, how can organizations keep pace with change? The key is for organizations to consult analyst insights and data. Through the ManpowerGroup Solutions and TAPFIN Quarterly Market Reports, organizations can access market intelligence on a local, regional and global scale and determine how trends and regulations may impact worker cost, performance and availability - putting the power to gain a quantifiable advantage in their hands.

Download the complete 2017 Q4 European Quarterly Market Report.

U.S. Financial Services Candidates

Inside the Heads of Job Seekers

Beyond compensation, candidate motivations in the workforce differ based on personal values. For U.S. financial services candidates, however, the motivations are especially distinctive, if not altogether surprising. They follow the beat of their own drum and employers would be wise to understand what makes them tick on a deeper level if they want to attract and retain top talent.

For decades, U.S. financial services candidates followed the best brand names in the business to help build their careers and climb the corporate ladder. Mergers, acquisitions and the Great Recession have changed that playing field. Technology and automation have forever altered the nature of the industry. Turnover has become the major pain point. But the long-term forecast for financial services candidates suggests a talent squeeze; Gen Xers (ages 35 to 49) will start retiring with an insufficient number of millennials (ages 25 to 34) to replace them. One in four CEOs in financial services sector reports that they cancelled or delayed a key strategic initiative within the past 12 months because the right people were not available.

To better understand how employers can leverage global candidate preferences and perceptions, ManpowerGroup Solutions, the world’s largest Recruitment Process Outsourcing (RPO) provider, went directly to the source: candidates. In the Global Candidate Preferences Survey, nearly 14,000 individuals currently in the workforce between the ages of 18 and 65 shared what matters to them in the job search process. The survey was fielded in 19 influential countries around the world during the fourth quarter of 2016. In the United States, ManpowerGroup Solutions surveyed 1,384 candidates and special emphasis was given to the fastest growing industries: financial services, healthcare, information technology (IT) and retail.

The fourth in a series exploring U.S. candidate preferences by industry, this report provides new insight into the successful recruitment and hiring of financial services candidates. The results reveal what is important to financial services candidates, how they are different from much sought-after IT candidates and why thoughtful strategies for recruitment and retention can help avoid a potential talent shortage in the industry.

Download the Whitepaper, Infographic or view the Microsite for more information.

2017 Q4 Global Quarterly Market Report

ManpowerGroup Solutions provides market trends as well as insight into the global contingent workforce as it evolves each quarter. Featured in this fourth quarter of 2017 are Global Workforce Management Trends, Contingent Labor Utilization, and Key Labor Trends for 2018 planning as well as regional labor statistics and overviews.

In a fast-paced, unpredictable marketplace, organizations must be able to react quickly. Today, organizations increasingly rely on the contingent workforce, such as independent contractors, temporary workers, consultants and freelancers. The contingent workforce is scalable and flexible, which provides organizations with the agility they need to remain competitive.

As the world of contingent work evolves, how can organizations keep pace with change? The key is for organizations to consult analyst insights and data. Through the ManpowerGroup Solutions and TAPFIN Quarterly Market Reports, organizations can access market intelligence on a local, regional and global scale and determine how trends and regulations may impact worker cost, performance and availability - giving organizations a quantifiable advantage.

Download the complete Q4 2017 Global Quarterly Market Report.

 

 

Swipe Right: Candidate Technology Preferences During the Job Search

Human Resource professionals would attest to the notion that technology has changed everything when it comes to attracting and hiring top talent. Technology is embedded in everything we do and it has affected most (or nearly all) aspects of the hiring cycle. Candidates use technology to search and apply for jobs. Employers use technology to engage candidates, build talent communities and interview prospects. Yet, what is not widely known is how candidate preferences about technology can be leveraged by employers. How can companies use technology to ensure a competitive advantage in today’s war for talent?

This report provides new insights into candidate technology preferences including global trends and country nuances. The research also reveals that the adoption of recruiting technology is light years behind consumer marketing technology. Candidates’ expectations for job searching are being driven more by contemporary dating apps than by current job search protocols. This report highlights what candidates need, want and expect from technology in the job search process and suggests new strategies employers can use to attract, develop and retain skilled talent.

Download the Whitepaper, Infographic or view the Microsite for more information.

U.S. Retail Candidate Preferences

Inside the Heads of Job Seekers

It does not take an online retailer’s drone to deliver the message that the retail industry is undergoing seismic shifts in how people shop for and purchase products. Most retail employers are well aware that omnichannel retailing is quickly becoming the norm.

During the first six months of 2017, the growth of online retailing has been blamed for more than 5,300 store closures in the U.S., triple the rate for the same period last year. Many cash-strapped retailers are looking to the holiday season to offset lagging revenues. As a result, seasonal retail hiring has never been more important.

In the ManpowerGroup 2016-17 U.S. Talent Shortage Survey, sales representatives (including retail salespeople) ranked third in the United States among the top 10 hardest jobs to fill. They also ranked third globally as the most challenging positions to hire. Moreover, they have appeared on the top 10 list for 11 consecutive years.

For decades, retailers have focused their energies on building brands that engage consumers. Now, they must shift their thinking to building employer brands. If the product bundle was the topic of retailing and marketing books in the past few decades, today’s management books should focus on the job bundle necessary to recruit top talent to the retail floor, warehouse and managers’ office. Just as products expand beyond traditional definitions of widgets for a price to include lifestyle branding and reputational association, jobs should be more than a job description and hourly wage. Now, jobs include all aspects of employer brand, such as a company’s social vision, philosophy on work-life balance and willingness to be a disruptive force for change.

To better understand how employers can leverage global candidate preferences and perceptions, ManpowerGroup Solutions, the world’s largest Recruitment Process Outsourcing (RPO) provider, went directly to the source: candidates. In the Global Candidate Preferences Survey, nearly 14,000 individuals currently in the workforce between the ages of 18 and 65 shared what matters to them in the job search process. The survey was fielded in 19 influential countries around the world during the fourth quarter of 2016. In the United States, ManpowerGroup Solutions surveyed 1,384 candidates and special emphasis was given to the fastest growing industries: retail, healthcare, IT and financial services.

The third in a series exploring U.S. candidate preferences by industry, this report provides new insight into the successful recruitment and hiring of retail candidates. The results reveal what is important to retail candidates, how process may cause them to self-select out of the pipeline and what employers can do to ensure the best prospects get to and through the application process.

Download the Whitepaper, Infographic or view the Microsite for more information.

As the nation’s largest private sector employer, retailers deeply understand and take pride in the space they hold in the marketplace for many job seekers. Whether an individual is looking for a first job, a second chance in the workforce or a highly skilled profession within a global supply chain, retailers provide opportunities for a wide range of career paths.

The unique needs of retail job seekers combined with an increasingly competitive labor market make “Inside the Heads of Job Seekers: U.S. Retail Candidate Preferences” a valuable tool for retail employers seeking top talent. This independent workforce study is also a mustread for policymakers grappling with state and local workforce rules and regulations. Before considering new laws, lawmakers should consider what retail employees value in their employment.

“Inside the Heads of Job Seekers: U.S. Retail Candidate Preferences” does an effective job detailing the desires of retail job seekers; specifically, that most retail job seekers prioritize flexibility and innovative work arrangements. As the marketplace for workers continues to evolve in a tech-forward manner, the report highlights how retailers can market job positions and optimize online recruitment processes to attract and retain the top job seekers.

As the trade association representing the world’s largest and most innovative retail companies, RILA and our Human Resources Leaders Council would like to thank ManpowerGroup Solutions for delivering this thought-provoking research, which will help retailers and policymakers understand and optimize the needs of a modern workforce.