Assembly Bill 168’s Impact on Hollywood

As of January 1, 2018, Assembly Bill 168, a new California law prohibiting employers (including movie and television studios) from asking potential employees for their salary history, went into effect. The new law prohibits the following: (1) Relying on the salary history information of an applicant for employment as a factor in determining whether to offer employment to an applicant or what salary to offer an applicant; (2) Asking (orally or in writing) an applicant for employment about his/her salary history, including compensation and benefits; (3) Refusing to provide, upon reasonable request, an applicant with the pay scale for a position; and (4) Contacting an applicant’s prior employer(s) for the information covered by (1), (2), and (3). However, the law does not prohibit the applicant from “voluntarily and without prompting” disclosing this information but, does prohibit agents from disclosing the information without express permission from their client. “This represents a pretty fundamental change in how negotiation has traditionally transpired in the entertainment industry,” says corporate attorney Bob Darwell, who represents companies like Amazon Studios. “The first step to cutting a deal was to call the talent representative and ask for quotes and then to verify those quotes.”[1]

The reaction to the bill is split among affected parties in this new Hollywood “no-quote” era. “All of the business affairs people are incredibly freaked out about it […] We as lawyers are too. Everybody’s talking about it,”[2] says attorney Linda Lichter who represents both talent and executives. However, supporters believe that the law will narrow the gender and diversity wage gaps. “I’ve been doing this for 26 years and had my eyes opened because it’s uncovered a bit of what was a pervasive inequality in what women and minority actors were being paid that was not as obvious before,”[3] says talent attorney Rick Genow.

Casting directors at major networks and studios who participated in TV’s annual pilot season say that the law is not impacting salaries as a whole because the overall budgets are not changing; it is, rather, dragging out the casting process due to the prolongated salary negotiation process.

Other states, cities, and jurisdictions have taken similar measures to prohibit employers from asking potential employees for their salary history. For example, on October 31, 2017, New York made it an “unlawful discriminatory practice” to ask applicants about their salary histories during the hiring process and will enforce a $250,000 penalty for violations.

The full extent of the potential ripple effect from the new California law remains to be seen, both in terms of number of states following suit, and whether other industries (inside and outside the entertainment world) will be materially impacted.

[1] Ashley Cullins, How a New Ban on Asking About Salary History Could Help (and Hurt) Women (Jan. 18, 2018).

[2] Id.

[3] Leslie Goldberg, How Actors Are Benefiting From a “No Quotes” Law (March 22, 2018).