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Chamber Releases Statement on Federal Lawsuit Challenging Philadelphia Wage History Ordinance

Posted Thursday, April 6th, 2017

Press Releases

The Chamber of Commerce for Greater Philadelphia today released the following statement after filing a federal lawsuit against the City of Philadelphia, which challenges the constitutionality of Bill No. 160840 that was signed into law in January 2017.

The Ordinance will prohibit employers (directly or indirectly) from asking job applicants about their prior salary or requiring disclosure of salary history as a condition of employment. If employers somehow come across such information, they are prohibited from using it to make salary decisions, unless the job applicant knowingly, and willingly disclosed it. The Chamber seeks a preliminary injunction to prevent enforcement of the Ordinance.

The statement reads:

“The Chamber of Commerce for Greater Philadelphia opposes Bill No. 160840 because the measure is flawed in multiple respects.

The Ordinance is a broad impediment to businesses seeking to grow their workforce in the City of Philadelphia. Along with a long series of other anti-business initiatives pursued by Philadelphia City government since 2009, the wage history ordinance is cementing a reputation for Philadelphia as being an anti-business city. Reflecting the views of its thousands of members, the Chamber has very serious concerns because the Ordinance contains numerous obstacles for businesses operating in the City, such as the exclusion of important information from the hiring process, no consideration for varying business needs, and potential civil and criminal penalties. The Ordinance makes searching for and recruiting top talent more difficult, which makes businesses in Philadelphia less competitive. The inevitable consequences will be companies choosing to do business elsewhere and the loss of jobs for city workers, among other negative impacts.

Further, the Ordinance violates employers’ First Amendment rights by prohibiting them from asking about wage history. Despite the attempt by the City to characterize the Ordinance as an attempt to address gender wage inequity, there is no evidence that prohibiting inquiries into wage history will do anything to address wage inequity, a goal the Chamber and its members strongly support. In fact, the City rejected a proposed Chamber amendment that would actually have addressed wage inequity in Philadelphia. The Chamber’s goals are to address wage inequity instead of violating constitutionally protected speech rights with no demonstrated link to solving the real issue at hand, and to ensure open and honest conversation between employers and job candidates.

The Philadelphia business community fully supports closing the gender wage gap and pledges to continue to seek ways to ensure that every worker is paid fairly regardless of gender. As an advocate of the regional business community, the Chamber recognizes that addressing the evolving demographic changes in our region is fundamental to the growth and sustainability of our Members. Creating an inclusive environment that engages individuals reflective of the full spectrum of our region is key to the success of Greater Philadelphia. This Ordinance, however, is not the answer to closing the gender wage gap.

With this Ordinance, which would have no meaningful effect on closing the wage gap, we would only reinforce our unfortunate, anti-business reputation of having a city government that tells companies how to run their businesses.”

The lawsuit was filed in the U.S. District Court for the Eastern District of Pennsylvania.

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