I have been extensively interviewing with a bank and I believe we might be approaching the offer stage but we are not formally there yet (I have interviewed with the whole team incl. hiring managers but never spoke to HR until now). They are now asking for proof of compensation at my current employer - I do not mind since I am paid street but I still find it somewhat invasive. Is that normal for them to ask? We have never discussed money before (they did not ask for my salary expectations)

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What state do you live in? It’s illegal in some for a potential employer to ask what you currently make. However, this wasn’t always the case. When I moved to my current employer many years ago they asked for my w2 as proof of employment and also based my offer off of that.

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I’d ask why they need proof of compensation. Fairly certain that’s illegal in most states. As part of a background check, I was asked if they could contact my employer to verify employment OR submit a pay stub, which I blacked out all pay info.

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Tell them to fuck off.
Your current pay has NOTHING to do with whatever offer they’re making to you.

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Maybe the reason why they want a proof of your previous pay is to be able to match it or give you higher than what you already had? But you said that pay wasn’t even discussed so at this point they’re just testing to see how much they can get away with. It’s borderline unprofessional

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like most banks, they are fishing for what they can get away with paying you. if they see that you are making market and want you, they will offer you market plus a bit extra. if they offer you below market then either they don't want you or they have stupid HR people.

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Asking for such proof is not a common practice. I also think that it is to match their offer or even offer a lesser amount. That's not right.

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Additional detail: I would take this offer if compensation was at least equivalent to what I get now given much better brand name and location but given said location is more expensive in nominal terms I would expect a bit more to feel as well off as where I currently am - do you think they could refuse to up that? Also in theory such info is confidential as per my contract

I’m not in the US, it’s not illegal here but still left me perplexed

Some companies do this but I won’t say it’s “normal”. Most of the time companies do this only because they want to lowball you as much as possible. They want to make sure their offer does not exceed your current pay too much and they can get you with the lowest number possible (which is a giant red flag IMO).
If possible, give them an salary expectation range or ask what they would like to offer. Or get a reason of why they would need such document presented since it is never required before.

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