January 24, 2017

Philadelphia Chamber: Salary history law hurts job growth, business recruitment

With Monday’s signing of a salary history bill, the City of Philadelphia continues its record of passing legislation that hurts job growth and business expansion. While this bill is supposedly an attempt to improve wage equity, there is in fact no evidence whatsoever that asking prospective employees about their current compensation contributes in any way to wage inequities. Unfortunately, the City government has rejected a proposal by the business community to discuss and enact a real wage equity ordinance.

The cumulative effect of city ordinances restricting businesses is having a negative impact on job growth in Philadelphia.

While the Chamber is deeply committed to highly diverse and inclusive workplaces and will not tolerate wage inequity, we believe passage of this measure says Philadelphia is not open for business. Philadelphia has a reputation around the country and world for having a high cost of doing business. With this bill, we have reinforced our unfortunate anti-business reputation of having a City government that tells companies how to run their business.”


RELATED STORY: Mayor signs wage equity bill guarding salary history in Philly

As a matter of policy, the Chamber stands against discrimination in any way on the basis of gender in the payment of wages, or to pay any person a salary or wage rate less than the rates paid to employees of a different gender for comparable work, provided that variation in wages are not prohibited due to seniority, and that seniority is not affected by pregnancy-related conditions, protected parental, or family and medical leave; commission-based systems; geography and/or education, training or experience; or travel.

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Rob Wonderling

This ordinance does not result in wage equity. Nor does it provide any evidence to suggest that removing this question from the hiring process results in wage equity.

Tragically, we are finding that when global enterprises are looking to locate their business in America, Philadelphia is quickly falling off the list. The cumulative effect of city ordinances restricting businesses is having a negative impact on job growth in Philadelphia. In addition, existing businesses located in the City will begin to look elsewhere as they plan for job growth.

In fact, data of annual private sector wage and salary jobs from 2010 to 2015 shows the nation’s 25 largest cities grew by 2.8 percent, with Philadelphia in last place at 1.1 percent.

Below are some of the restrictive, anti-job growth measures taken up by Philadelphia City Council over the last few years:

• 2011: "Ban the box legislation," which barred an employer from inquiring about criminal background until after the first interview.

• 2012: “First Source Jobs Policy” which requires recipients of financial assistance from the city to "hire first" for entry-level jobs from a registry of unemployed Philadelphians.

• 2013: Prerequisites to City Contracts: Requires contractors to disclose, as part of the bidding process, the current percentage of female executive officers in the company and the current percentage of females on the company’s executive and full boards, as well as the company’s aspirational goals for the inclusion of females in executive positions and on the executive and full boards, and also the intended efforts by the contractor to achieve the aspirational goals.

• 2013: Legislation to prohibit employers from requesting access to employees’ social media profiles.

• 2014: Minimum wage executive order to increase to $12/hour for city contractors and subcontractors.

• 2015: Mandatory paid sick leave legislation.

• 2015: Wage theft law that imposes higher penalties than state law and adds private right of action for alleged violations.

• 2015: Amendments to “Ban the box legislation” barring employer from inquiring about criminal background until after conditional offer of employment. Also limits lookback to 7 years.

• 2016: Ordinance limiting employer ability to obtain credit checks as part of applicant background check process.

• 2016: Minimum Wage Ordinance Amendment Bill – Amends the 21st Century Ordinance to increase the minimum wage to the higher of 150 percent of the federal minimum ($10.87) or $12 with a CPI multiplier, for new contracts or renewals of existing contracts.

The Chamber of Commerce for Greater Philadelphia stands committed to aggressively advocating on behalf of its members and for the benefit of those working to bring more jobs to Philadelphia, and looks forward to working with the Mayor and City Council on a jobs growth agenda for all citizens.

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Rob Wonderling is president and CEO of The Chamber of Commerce for Greater Philadelphia.