How Salary History Question Bans Are Reshaping Hiring Practices in the Construction Industry

How Salary History Question Bans Are Reshaping Hiring Practices in the Construction Industry

A growing wave of legislation is prohibiting employers from asking job candidates about their salary history, and the construction industry faces unique exposure to these rules. According to a survey by Morrissey Goodale LLC, 84 percent of AEC firm leaders report that they regularly ask about salary history during interviews. This long-standing practice places the industry at the center of a fast-moving regulatory shift. For construction firms, understanding how these bans work is no longer optional. It is a compliance necessity that affects hiring speed, pay equity, and the ability to attract skilled labor.

This article explains what the salary history question ban means for construction employers, the states leading the charge, and how firms can adapt hiring and compensation practices to stay compliant while remaining competitive.

Understanding the Salary History Question Ban and Its Reach

Salary history question bans prohibit employers from asking job applicants about their past wages, salaries, or other compensation during the hiring process. Some laws go further, preventing employers from relying on salary history to set pay for new hires even if the information is volunteered. The stated intent is to break the cycle of pay discrimination, where historically lower pay for women and minorities follows them from job to job, perpetuating wage gaps.

As of 2025, more than 20 states and numerous municipalities have enacted some form of salary history ban. The movement gained significant traction after California, Massachusetts, and Oregon passed early versions of the legislation. These laws vary in scope and enforcement, but their core effect on hiring is consistent.

States and Cities with Active Salary History Bans

The following table summarizes key jurisdictions with salary history question bans relevant to the construction industry:

Construction firms operating across state lines must track these variations carefully. A recruitment process designed for a state without a ban may violate the law in a neighboring jurisdiction.

The Enforcement Landscape

Enforcement mechanisms differ by jurisdiction. Some states allow private lawsuits by aggrieved job candidates, while others rely on state labor departments to investigate complaints. In California and Massachusetts, for example, an applicant who believes they were asked an unlawful salary history question can file a complaint with the state labor commissioner or pursue a civil action. Penalties can include fines, damages, and attorney’s fees, making the financial risk material.

Why the Construction Industry Faces Unique Compliance Risks

The survey data from Morrissey Goodale highlights a structural vulnerability in the AEC sector. With 84 percent of firm leaders regularly asking about salary history, the industry has one of the highest prevalence rates of this practice across all sectors. The nature of construction hiring makes salary history questions particularly tempting for employers.

Industry Practices That Increase Exposure

Several characteristics of the construction industry create a higher risk profile under salary history bans:

• Project-based compensation patterns. Construction salaries vary significantly based on project location, duration, and hazard exposure. Employers often use salary history to benchmark offers against what candidates earned on previous projects, a practice that now carries legal risk.
• Union versus non-union wage differentials. Candidates moving between union and non-union work may have dramatically different pay histories. Asking about past wages in this context can introduce bias that the new laws are designed to eliminate.
• Seasonal and cyclical employment. Many construction workers move between employers as projects end and begin. In a cyclical industry, salary history can reflect market timing as much as skill level, making it an unreliable benchmark.
• Geographic mobility of the workforce. Construction crews regularly cross state lines. A worker interviewed for a project in Philadelphia may have been recruited by a firm in a state without a ban, but the interview location triggers the local law.

Cost of Non-Compliance

The financial impact of a violation extends beyond legal penalties. For a construction firm, a discrimination complaint can delay project staffing, damage relationships with general contractors who require compliance certifications, and harm the company’s reputation in a tight labor market. In an industry where workforce recruitment is already a top challenge, adding a reputation for discriminatory hiring practices can be a serious competitive disadvantage.

How Construction Firms Can Adapt Their Hiring Practices

Adapting to salary history bans requires changes to recruitment workflows, interviewer training, and compensation setting processes. The following steps represent a practical compliance framework for construction employers.

Reforming the Interview Process

The first and most obvious change is removing salary history questions from all stages of the hiring process. This includes:

1. Application forms. Remove any fields that ask for current or past salary, wages, or compensation. Many applicant tracking systems (ATS) have default fields for this information that must be disabled or removed.
2. Phone screens. Train recruiters and HR staff not to ask salary history questions during initial phone interviews. This includes indirect questions such as “What were you making at your last position?” or “What range were you in at your previous company?”
3. In-person and virtual interviews. Project managers, site supervisors, and other staff involved in interviewing must receive training on prohibited questions. A superintendent who asks “What did your last company pay you?” during a site visit can create liability.
4. Third-party recruiters. If your firm uses staffing agencies or subcontractors to source candidates, ensure their interview protocols also comply. The employer can be held liable for a recruiter’s violation.
5. Background checks. Some background check providers include salary verification as a service. Review your background check authorization forms and vendor agreements to ensure they do not request salary data.

Developing a Salary Range Framework

Without salary history data, construction employers need a defensible method for setting starting pay. A structured salary range framework is the solution:

• Define pay bands for each role based on market data from industry salary surveys, not individual candidate history
• Set minimum and maximum rates for each band with clear criteria for where a candidate falls within the band (experience level, certifications, project complexity managed)
• Document the criteria used to place candidates within bands so that decisions can be justified if challenged
• Review and update bands annually based on published compensation data from sources such as the Associated General Contractors of America or Engineering News-Record

Training Interviewers and Hiring Managers

Training is the most critical control, because interviewers on construction sites are often operations staff, not HR professionals. An effective training program should cover:

• Which questions are prohibited (salary history, benefits at previous employer, past bonus amounts)
• Which questions are permitted (salary expectations, desired compensation range for the role)
• How to redirect the conversation when a candidate volunteers salary history unprompted
• How to document the interview to demonstrate compliance
• Consequences of non-compliance for the firm and the individual

Leading firms require compliance training before any employee can participate in candidate interviews and refresh it annually.

Building a Compliant and Competitive Compensation Strategy

Salary history bans force construction employers to shift from a reactive compensation model (matching what a candidate previously earned) to a proactive model (setting pay based on the role’s value and market conditions). This shift can ultimately benefit firms that execute it well.

Moving from History-Based to Role-Based Pay

The old approach was simple: ask what the candidate made, then offer a percentage increase. The new approach requires employers to determine the value of the position itself. This involves a more disciplined compensation process with several advantages:

• Internal equity improves. When pay is based on the role rather than individual history, two employees doing the same work are more likely to receive comparable pay, reducing turnover from perceived unfairness
• Budget predictability. Without the variable of individual salary history, compensation costs become more predictable during project bidding and budgeting
• Negotiation efficiency. When employers clearly communicate a salary range upfront, negotiations focus on fit and qualifications rather than anchoring to past pay

Pay Transparency as a Recruiting Advantage

Several states with salary history bans also require salary range disclosure in job postings. Forward-thinking construction firms use pay transparency to differentiate themselves. When a posting includes a clear salary range, it signals professionalism and attracts candidates who value fair treatment. In a market where skilled tradespeople are in short supply, transparency can shorten time-to-hire.

Benchmarking Against Industry Standards

Without salary history data, construction firms need reliable market benchmarks to set competitive pay. The following sources provide useful compensation data for the AEC sector:

• AGC (Associated General Contractors of America) workforce surveys
• Engineering News-Record (ENR) annual compensation reports
• Bureau of Labor Statistics Occupational Employment and Wage Statistics for construction occupations
• State-specific workforce development reports that break down construction wages by region
• Industry association salary surveys from organizations like the American Institute of Architects and the National Society of Professional Engineers

Using these benchmarks, construction employers can establish pay ranges that are both competitive and defensible, without relying on a candidate’s previous compensation.

Documenting Compliance for Audits and RFPs

Many commercial construction projects require contractors to submit compliance documentation as part of the bidding process. General contractors and project owners increasingly ask about pay equity practices and hiring compliance. Having a documented compensation framework and trained interviewers is becoming a competitive advantage in winning bids.

Firms that invest in compliance infrastructure now will be better positioned as more states adopt salary history bans. The attention to detail required mirrors the discipline successful construction firms apply to project delivery.

The Bottom Line for Construction Employers

The salary history question ban is not a passing regulatory trend. More states are adopting these laws each year, and enforcement is increasing. For an industry where 84 percent of leaders have relied on salary history as a standard hiring practice, the adjustment is significant but manageable. Construction firms that act now to train teams, reform processes, and build transparent compensation frameworks will reduce legal risk and improve their ability to attract skilled workers. Those that wait for a complaint or investigation will find themselves playing catch-up at a much higher cost.