HB 146-DISCLOSURE OF WAGE INFORMATION  8:55:41 AM CO-CHAIR FIELDS announced that the next order of business would be HOUSE BILL NO. 146, "An Act relating to disclosure of information regarding employee compensation by employers, employees, and applicants for employment; establishing the fund for protection of compensation disclosure rights; and providing for an effective date." 8:56:31 AM The committee took an at-ease from 8:56 a.m. to 8:57 a.m. 8:57:05 AM CO-CHAIR SPOHNHOLZ moved to adopt the proposed committee substitute (CS) for HB 146, Version 32-LS0513\B, Wayne, 4/19/21 ("Version B"), as the working document. There being no objection, Version B was before the committee. 8:57:29 AM REPRESENTATIVE SNYDER, as prime sponsor, introduced HB 146. She shared that the proposed legislation seeks to support fair hiring practices for the protection of all Alaskan workers while ensuring that employers are not placed at unfair risk or disadvantage. She said that the first component is "pay privacy," a provision under which employers would be prohibited from requiring an applicant's salary history during the application process. She said this component would allow the employer and applicant to focus on qualifications, which would help to ensure that salary history doesn't unduly affect an individual's economic potential. She said that 27 states, and many cities, have a similar law, and the U.S. House of Representatives recently passed the Paycheck Fairness Act; if that Act passes at the federal level, HB 146 would ensure parity between the state and federal law. REPRESENTATIVE SNYDER said the second component of HB 146 could be called "pay transparency," a provision under which applicants and/or employees must be allowed to discuss their salaries if they choose to do so. She stated that the National Labor Relations Act protects this type of discussion, as does decades of case law. The third component, she said, is called "pay posting." Job announcements must include a range of pay as well as other compensation details; by doing so, she said, applicants won't misdirect resources toward job openings with compensation that doesn't meet their needs. This component would also benefit employers, she said, by helping them avoid spending valuable time interviewing applicants who ultimately wouldn't accept the offer due to pay. She described sitting on hiring committees and spending many hours and thousands of dollars recruiting and interviewing potential employees, only to have the job offer turned down because the applicant wasn't aware of the salary range prior to the offer. REPRESENTATIVE SNYDER said that HB 146 would disallow retaliation against an applicant or employee who chooses to not share salary history or who chooses to share current salary information. A small fine for violations would be implemented under HB 146, she said, with the revenues directed to the undesignated general fund (UGF); the fine could be avoided if an employer changes their practices to operate within the parameters of the proposed legislation. She stressed that HB 146 would not require an employer to offer any specific pay range or compensation package, nor would it disallow an employer to amend compensation after an interview has been conducted. "The range is a starting point; it gives a potential applicant a general idea of where the conversations may begin," she said. She pointed out that the provisions would not disallow an employer from asking what an applicant's salary expectations would be, and that an applicant may still choose to share salary history. 9:05:50 AM REPRESENTATIVE SNYDER shared that there is growing evidence showing that the issues which would be addressed by HB 146 are pervasive and persistent. She said that on the issue of pay privacy, nationally representative studies from 2012, 2017, and 2019 show that up to 47 percent of respondents said they have been asked about past wages. A study from 2011, she said, showed that half of all workers reported that discussion of wage and salary information was either discouraged or prohibited by their employers. 9:08:03 AM ALLIANA SALANGUIT, Staff, Representative Liz Snyder, Alaska State Legislature, presented the sectional analysis for HB 146 on behalf of Representative Snyder, prime sponsor, which read as follows [original punctuation provided]: Sec. 1: Amends AS 22.10.020. Jurisdiction of the Superior Court by establishing that the Superior Court has jurisdiction over all causes of action that arise under the remaining law sections in this bill. An aggrieved employer or employee may apply to the Superior Court for relief. Sec. 2: Amends AS 23.10 Employment Practices and Working Conditions by adding Article 9. Disclosure of  Employee Compensation and the following sections:  Sec. 23.10.700. Disclosure of Discussion Wages:  (a) Requires job postings to include a salary or salary range. (b) Allows applicants and employees to discuss current wage, prohibits employers from asking applicants about their salary history with another employer (c) Clarifies that nothing in this section obligates an employee or applicant to disclose their compensation, prohibits an employee or applicant from voluntarily disclosing, or prohibits an employer from using information that is voluntarily disclosed under this subsection when determining the salary of an employee or applicant. ? Sec. 23.10.705 Posting Summary Required requires an employer to post information summarizing the bill's provisions. ? Sec. 23.10.710 Retaliation Prohibited prohibits an employer from retaliating against an employee for exercising a right under the bill. ? Sec. 23.10.715 Damages for Retaliation allows an employee to file a civil claim against an employer if the employer retaliates. ? Sec. 23.10.720 Statute of Limitations gives an employee no more than 3 years after a violation to file a civil claim. ? Sec. 23.10.725 Penalty creates a fine between $100- $2000 for violations and directs the Department of Labor and Workforce Development Commissioner to determine the amount. An employer may, at the discretion of the Commissioner, reduce the fine or correct the violation by conducting an audit. ? Sec. 23.10.735 Regulations adds language directing the Department of Labor and Workforce Development Commissioner to implement and interpret this bill and adopt regulations accordingly. ? Sec. 23.10.790 Definitions exempts independent contractors from the definition of "employee." Defines an "employer" as the state, the University of Alaska, the Alaska Railroad Corporation, a political subdivision of the state, and a person who employs one or more employees. Sec. 3: Adds conforming language AS 22.10.020. Jurisdiction of the Superior Court Sec. 4: Provides for an effective date of July 1, 2021. 9:10:44 AM REPRESENTATIVE SNYDER introduced her invited testifier. 9:11:14 AM HILARY MORGAN, Chief Executive Officer, Resourceful Results, LLC, testified in support of HB 146, which she said would be helpful in leveling the playing field for women and people of color in finding and attaining fair wage employment. She said that in her former position as CEO of Young Women's Christian Association (YWCA) of Alaska she worked on an initiative to help close the gender pay gap and with the Department of Labor and Workforce Development (DLWD) studying wages in Alaska. The data showed that for full time, year-round workers, women made less than men in every geographic location and every market sector, and that the wage gap persisted regardless of industry, education level, and occupation. She explained that asking for a person's salary history can perpetuate discriminatory practices instead of evaluating an applicant on merit. Regarding pay posting, she said, research has shown a double standard in salary negotiation between men and women, and between white people and people of color; men who negotiate salary are seen as "strong" and "closers," while women who negotiate are seen as "bossy" and not being a "team player." When people of color negotiate salary, she said, they're most often seen as either "overstepping" or "ungrateful." She pointed out that anyone who has ever interviewed for a job knows that asking for salary range during the interview has negative connotations. She said that managers know what the salary range is on every job; budgets can't be done without having the information before advertising the opening. In her experience as a CEO, she said, listing the salary range in the job posting streamlined the application and interview process and attracted applicants comfortable with the range; while it didn't inhibit her from offering an applicant a higher wage, it did limit her ability to "lowball" an applicant. She expressed her belief that HB 146 would mitigate all of the issues she described. 9:15:41 AM REPRESENTATIVE NELSON asked whether the intention of HB 146 is to have an individual reporting to the DLWD that a job posting doesn't include salary information. REPRESENTATIVE SNYDER replied yes. She explained that the proposed legislation would give DLWD the authority to decide how best to address such complaints. REPRESENTATIVE NELSON asked whether DLWD would be able to handle the workload. REPRESENTATIVE SNYDER referred to the fiscal note and said that DLWD currently has 13 investigators who work on prevailing and minimum wage issues. REPRESENTATIVE NELSON opined that it's difficult to justify a $300,000 fiscal note for that amount of self-reporting. REPRESENTATIVE SNYDER shared that the fiscal note amount was surprising and that there were discussions with DLWD about what their process was in arriving at the amount. She pointed out that, since receiving the fiscal note, research has shown that several states with similar or larger populations have enacted similar laws with either no fiscal notes or notes with very small amounts, usually intended for implementation or education. 9:19:10 AM CO-CHAIR FIELDS commented that there are already staff in place to enforce the provisions and that he doesn't see the need for a fiscal note. 9:19:53 AM JOE DUNHAM, Chief Investigator, Wage and Hour Administration, Division of Labor Standards and Safety, Department of Labor and Workforce Development, said that the logic behind the fiscal note is that the underlying message of HB 146 is "equal pay for equal work." He said that if workers were to start discussing their wages there could be many calls coming in to his office. He said that he would like to add three workers to handle the "onslaught" of calls regarding issues of termination, retaliation, or the handling of back wages. He said that he could understand the existence of a zero fiscal note if implementation was a simple issue of putting up a poster, but this proposed legislation would encourage workers to openly discuss their salaries. 9:21:16 AM REPRESENTATIVE SNYDER commented that if DLWD foresees an onslaught of complaints in response to HB 146, such an opinion further justifies the need for the proposed legislation. MR. DUNHAM replied that he could see many moot investigations. 9:22:12 AM CO-CHAIR SPOHNHOLZ asked whether the three-year limitation to file a civil claim would apply to all provisions of the bill. REPRESENTATIVE SNYDER replied that it would. 9:22:38 AM REPRESENTATIVE NELSON asked whether HB 146 would be pulled if the federal Paycheck Fairness Act were enacted. REPRESENTATIVE SNYDER noted the common practice of having laws in state statute that mirror those on the federal level. 9:23:30 AM CO-CHAIR SPOHNHOLZ invited Mr. Wayne to discuss the subject of federal versus state statutes. 9:23:55 AM DAN WAYNE, Attorney, Legislative Legal Services, Legislative Affairs Agency, said that he doesn't know of a federal law that specifically requires employers to post a salary range or that protects the rights of employees to discuss their salaries. 9:25:20 AM REPRESENTATIVE SNYDER clarified that she was referencing the Paycheck Fairness Act, which would be a new federal law addressing pay privacy and prohibiting employers from requiring an applicant's salary history. She pointed out that 27 states already have the law in place, and that the proposed legislation would be intended to complement the federal law. REPRESENTATIVE NELSON stated that his earlier question was whether there would be any conflict between HB 146 and the legislation proposed at the federal level, should they pass. 9:26:15 AM REPRESENTATIVE MCCARTY asked Mr. Dunham how many investigations he conducts on a monthly basis and by how much he would expect the number of investigations to increase as a result of HB 146. MR. DUNHAM replied that displaying wages on a job posting shouldn't cause any increase in workload in his department, nor does he anticipate an increase in the workload resulting from the provision about employers being prohibited from asking about previous wages. He said encouraging employees to discuss wages could cause problems. He said, "If I hire a mechanic at $26 an hour and then I hire this next one at $30 an hour, I'm going to tell him, 'Don't talk about your wages because it's going to cause a problem.'" He said that he could see the lower-paid mechanic wanting more money and possibly contacting DLWD about the issue of equal pay for equal work. 9:29:18 AM REPRESENTATIVE SNYDER pointed out that Mr. Dunham just highlighted how important the education roll-out is, so that individual and employers fully understand the parameters of the proposed legislation. She noted the importance of distinguishing between policy preferences and cost estimates of implementation and monitoring. 9:30:33 AM REPRESENTATIVE KAUFMAN referred to page 2, lines 21 through 24, which read as follows: (c) Nothing in this section (1) creates an obligation for an employee or applicant for employment 23 to disclose information about the employee or applicant's compensation or the 24 compensation of another; REPRESENTATIVE KAUFMAN commented that some people might not want others to know their salary range. He then asked whether the proposed legislation includes protections for employers who want to compensate high performers. REPRESENTATIVE SNYDER explained that the "pay privacy" provision is sometimes called a "salary history ban" and is connected in a positive way to "pay posting." She said that there exists evidence that when employers are prohibited from requiring salary histories from their applicants, they naturally gravitate toward posting the salary range on the job posting, eliminating the need to ask for an applicant's pay history because the applicant is prepared for the salary range. She also stated that nothing in the proposed legislation would prohibit an employer from giving a bonus or other reward for good work. She expressed being amenable to changing the language of the proposed legislation to clarify that point. 9:33:40 AM CO-CHAIR FIELDS announced that HB 146 was held over.