Several states have enacted pay transparency laws that make it obligatory for employers to provide wage information to candidates. While these regulations can be a boon for job applicants, they often pose a challenge for the organizations that need to implement them. Revealing salary ranges for new jobs can upset lower-paid existing employees. And disclosing how much they are willing to pay to jobseekers could reduce the employer’s negotiating power.
This post will list the states and cities that have passed laws requiring employers to disclose salary ranges for job openings. We’ll also briefly describe the level of transparency these laws require.
California: Equal Pay Act
Effective date: Although the California Equal Pay Act was passed in 1949, the amendment mandating that employers provide job applicants with salary ranges came into effect on January 1, 2018.
Employers aren’t permitted to ask for an applicant’s salary history (unless the applicant was working for a public employer and the salary was disclosable). Additionally, employers are required to provide applicants with pay information scales upon request. However, employers are legally obligated to give these details only after the applicant has completed an initial interview.
Colorado: Equal Pay for Equal Work Act
Effective date: January 1, 2021
Colorado’s pay transparency law is pretty comprehensive. It applies to any organization that has at least one employee. The provisions of the statute:
- Require employers to post a compensation range and details of employment benefits in their job postings.
- Prohibit employers from asking for the applicant’s salary history.
- Permit employees to speak to other employees about how much they make.
Effective date: October 1, 2021
Employers can’t ask candidates about their salary history. They are also required to disclose the wage range when an applicant requests. However, employers are not required to reveal the wages they pay to any individual employee.
Cincinnati, Ohio: Cincinnati, Ohio – Code of Ordinances – Chapter 804 – Prohibited Salary History Inquiry and Use
Effective date: March 2020
The Ordinance (No. 83-2019) states:
An employer, upon reasonable request, shall provide the pay scale for a position to an applicant…for which the applicant has been provided a conditional offer of employment by the employer.
Companies could be in trouble if they don’t follow the law. If the employer violates any provision in the ordinance, the employee can seek damages by bringing a lawsuit within two years of the violation.
Maryland: Maryland Equal Pay for Equal Work
Effective date: October 1, 2020
Maryland law stipulates that employers aren’t permitted to ask job applicants for their salary history. They must also provide candidates with “the wage range for the position for which the applicant has applied”.
Nevada: Senate Bill 293
Effective date: October 2021
Employers are required to provide “wage or salary range” or “rate” to applicants who have completed an interview for a job. It’s compulsory to provide this information even if the employee hasn’t asked for it. Additionally, current employees who have applied for a promotion or transfer must be provided with a salary range for the new position upon request.
Nevada’s pay transparency legislation also specifies that employers aren’t permitted to ask job applicants for their wage or salary history. Even if applicants give their salary voluntarily, the employer isn’t allowed to rely on the disclosure to determine the compensation for the new job.
New York City: Int. 1208-2018
(A Local Law to amend the administrative code of the city of New York, in relation to prohibiting employers from posting job listings without minimum and maximum salary information.)
Effective date: May 15, 2022
Currently, employers aren’t required to provide job applicants with salary details until the end of the hiring process. But that will change from May 15, 2022, when the new pay disclosure law comes into force. New York City’s new rule applies to organizations with four or more workers. This number includes children, parents, domestic partners, and spouses considered “employees” under the law.
In addition to providing salary ranges for new positions, employers will also need to provide this information when advertising within the organization for transfers and promotion opportunities.
Rhode Island: Senate Bill 270 – Fair Employment Practices
Effective date: January 1, 2023
Employers are obligated to disclose salary ranges to job applicants from the beginning of next year. The regulation applies to internal transfers as well.
What if an organization doesn’t implement the new rule? The law gives employers a grace period of two years. So, the Rhode Island Department of Labor and Training will not impose any civil penalties on employers in 2023 and 2024. Subsequently, it is empowered to levy fines between $1,000 and $5,000 for non-compliance.
Toledo, Ohio: Pay Equity Act
Effective date: June 25, 2020
The Pay Equity Act applies to employers with 15 or more workers. When evaluating job applicants, organizations aren’t permitted to ask for salary history. Additionally, employers are required to provide applicants with a pay range if they make a conditional offer of employment. However, candidates will get these details only if they ask for them.
Washington: Equal Pay & Opportunities Act
Effective date: July 28, 2019
The new pay transparency rules apply to job applicants as well as current employees.
Candidates must be provided with “the minimum wage or salary” when they ask for it. But this information can only be requested after the organization has made an initial offer of employment. Employers aren’t permitted to ask candidates about their salary history.
When an existing employee gets the option of taking up a new position, a transfer, or a promotion, the employer is obligated to provide a “wage or salary range” upon request.
Effective date: January 1, 2023
Senate Bill 5761, which passed earlier this year, will require employers with more than 15 employees to include the salary range, as well as a general description of benefits and other compensation. This bill is similar to those in Colorado and New York City.
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The Bottom Line
Pay transparency is on the rise. Approximately 12 percent of job postings now include salary ranges. That’s a big improvement from the 8 percent reported in 2019. With more and more cities and states adopting pay transparency laws, you can be sure that in the coming years this percentage will rise.
While some may argue that regulations that require salary ranges in job postings can make the recruitment process more difficult for employers, posting the ranges in the job description has significant benefits. Knowing what the job pays will help prospective employees decide whether they want to apply for a specific opening and employers are less likely to receive applications from people who could back out once they learn about the compensation the position offers.