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Bill

SB 540

Relating to: prohibiting an employer from relying on information about a prospective employee’s compensation when making employment decisions or inquiring about a prospective employee’s compensation and from restricting an employee’s right to disclose compensation information, allowing actions in circuit court, and providing a penalty. (FE)

2025-2026 Regular Session Introduced by Tim Carpenter and 11 co-sponsors

Wisconsin bill prohibits employers from asking about or using applicants' prior compensation in hiring decisions and protects employee wage discussions, enforceable through court actions.

Failed to pass pursuant to Senate Joint Resolution 1
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Bill Summary · SB 540

Legislative bill overview

SB 540 prohibits Wisconsin employers from considering or requesting information about a job applicant's previous compensation when making hiring decisions. The bill also protects employees' right to discuss their wages with coworkers and establishes legal remedies through circuit court actions with associated penalties for violations.

Why is this important

Wage history bans aim to reduce persistent pay inequities, particularly affecting women and minorities who often enter new positions at lower salaries that compound over their careers. By preventing employers from anchoring offers to previous compensation, the bill seeks to create more equitable hiring practices and compress pay gaps. However, it represents a significant constraint on employer discretion in compensation decisions and labor market information gathering.

Potential points of contention

  • Employer burden: Critics argue the restrictions limit employers' ability to assess market-competitive offers and may force reliance on less reliable compensation benchmarks
  • Enforcement mechanism: The circuit court action provision could generate litigation, raising questions about standing, damages calculation, and administrative costs for both employers and employees
  • Competitive disadvantage: Some worry Wisconsin employers may face recruitment challenges if surrounding states allow wage history inquiries, affecting business competitiveness
  • Scope ambiguity: Questions remain about what constitutes "relying on" compensation information and whether indirect knowledge of salary history violates the ban

Compiled from official sources — confirm details with the bill’s official record.

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