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Part of a growing trend to help close the pay gap through salary transparency

Starting on May 15, 2022, employers in New York City must begin listing salary ranges in any advertisements for jobs, promotions, or transfer opportunities with the passage of this bill.

New York City is not alone. Around the country, there have been an increasing number of local and state laws focused on promoting pay transparency and equity.

In 2021, Colorado enacted a law that requires employers to disclose the compensation or range of possible compensation in job advertisements.  Last year, Connecticut and Nevada enacted pay transparency laws similar to New York City, and Rhode Island passed a law that will become effective January 1, 2023 requiring employers to provide wage or salary range information to applicants and employees under certain conditions. In addition, California, Maryland, and Washington also have laws requiring salary disclosure, but only upon the request of an applicant or employee. A version of this bill has been introduced in New York State Senate and other states, including South Carolina and Massachusetts, are also considering pay transparency bills.

Details of this new law

Under New York City’s new law, employers in New York City will commit an “unlawful discriminatory practice” if they advertise a job, promotion, or transfer opportunity without stating the minimum and maximum salary for that position in the advertisement. Employers must list a salary range extending from the lowest to the highest salary they believe in “good faith” that they would pay for the job, promotion, or transfer at the time of the posting.

Not complying may result in a fine of up to $125,000 and employers who “willfully, wantonly or maliciously” engage in unlawful discriminatory practices can be fined up to $250,000. Additionally, under New York City’s Human Rights law, aggrieved individuals and the City’s Commission on Human Rights, are entitled to bring suit against an offending employer, which may subject the employer to additional non-monetary and monetary damages.

The law applies to all employers with at least four employees in New York City, which includes independent contractors. It does not apply to temporary positions advertised by temporary staffing agencies.

 

Some questions still remain

However, some aspects of this law are still unclear. It does not define “advertise” and it does not differentiate between jobs that are posted externally versus internally.  The law also does not define a “salary” or clarify the requirements for non-salaried positions. Another unanswered question so far is if this law applies to employers who are physically located outside of New York City but who advertise for job openings in New York City.

PowHer New York is a nonprofit organization focused on economic equality for women that helped drive this legislation. Beverly Neufeld, PowHer’s president described the law as a “concrete step in eliminating the causes of wage inequality.”

“This transformative law will minimize bias, maximize transparency, shift cultural norms and level the ‘paying’ field,” she said in a statement.

Author

Paul McGovern
Managing Partner
Praxis Compliance

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