New York State’s Pay Transparency Law, which became effective on September 17, 2023, marks a significant step towards pay equity and transparency. This law mandates employers with four or more employees to disclose salary ranges in all job advertisements, whether internally or externally.
New York State’s Pay Transparency Law Explained
Under New York State’s Pay Transparency Law, employers are required to include an hourly rate, salary, or pay range for all advertised jobs, promotions, and transfers. The job posting must advertise the salary or salary range the employer believes, in good faith, to be true at the time of posting and should give the prospective applicant a legitimate idea of the expected pay. Moreover, the job postings must encompass a job description if one exists. This law applies to both internal and external job postings, with the purpose of providing job seekers with information that addresses systemic pay inequity and discriminatory wage-setting and hiring practices.
Implications for Employers
To comply with this law, employers can reassess compensation policies, determine pay ranges for all positions, and train HR, recruiters, and hiring managers on the implications of the disclosure obligation. The law applies to jobs in New York state and any remote positions performed outside of the state, but report to a supervisor, office, or other worksite in the state.
Employers should review all new job postings and consider conducting a pay equity audit. Job ads are covered, regardless of whether they are posted by the employer directly or through a third-party, such as a recruiter or a job listing website. Therefore, the onus is on the employer to ensure third parties include the required pay range.
Impact on Remote Jobs
The New York State’s Pay Transparency Law also extends its application to remote positions. These include jobs that may be performed outside of the state but report to a supervisor, office, or other worksite in the state. Employers are encouraged to review all new job postings and consider conducting a pay equity audit to ensure compliance.
Penalties for Noncompliance
The law provides a framework for civil fines for businesses found in violation of its provisions. The penalties for noncompliance include $1,000 for the first violation, $2,000 for the second violation, and $3,000 for the third violation and beyond. Individuals may also file a complaint with the NYS DOL commissioner for any perceived violations.
As the law takes effect, employers—both within and outside New York—should take the necessary steps to ensure compliance, thereby contributing to a more equitable and transparent job market. Insero is already implementing these steps for our clients – if you have questions, please talk to your recruiting consultant or contact us today.