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Effective May 15, 2022, certain employers in New York City will be required to disclose salary ranges when advertising positions. The law is part of a trend toward greater pay transparency that is taking hold in cities and states around the country. At this juncture, a final rule implementing the new disclosure law has yet to be written; however, employers should consult with an experienced employment lawyer to learn how this law may impact their business.
Pay Transparency in NYC
The new law will amend the New York City Human Rights Law (the “NYCHRL”) to make it an unlawful discriminatory practice for a covered employer to advertise a job, promotion, or transfer opportunity without including the minimum and maximum salary range in the job posting.
The new law covers employers in the city with 4 or more employees, as well as employment agencies; independent contractors are also included in determining whether an employer is covered. However, temporary agencies that advertise temp positions are not covered – these agencies are already required to disclose this information under the New York State Wage Theft Prevention Act.
In particular, the law requires employers to post the “lowest to the highest salary the employer in good faith believes at the time of the posting” for a particular position. Further guidance is still needed on what constitutes “good faith,” the definition of “salary,” and whether the salary disclosure requirement applies to remote work.
What the Salary Disclosure Law Means for NYC Employers
While the New York City Commission on Human Rights (Commission) is tasked with writing a final rule, effective date, employers should begin to revise covered job posting in advance of the May 15 effective date. It is also wise for employers to determine and document the rationale for salary ranges for covered positions.
Ultimately, employers will no longer have an upper hand in salary negotiations by being required to disclose salary ranges upfront. More importantly, failure to comply with the salary disclosure requirement may expose employers to potential liabilities, including fines imposed by the Commission and monetary damages awarded in a lawsuit.
How the Law Benefits Workers
Forcing employers to disclose job postings will give job seekers more bargaining power and decrease the odds of getting low-balled. Lawmakers also believe that the law will help to address pay disparities based on race or gender. To some extent, the new salary disclosure requirement dovetails with amendments to New York state law in 2019 prohibiting employers from requiring job candidates to provide salary history information.
The Takeaway
In recent years, pay transparency requirements have been enacted in several states in an effort to foster pay equity. While some employers contend that the new law will be burdensome and costly to implement and may limit the pool of qualified candidates, salary disclosure requirements become effective May 15, 2022. The best way to ensure that your company is in compliance with the salary disclosure law is to get in touch with an experienced employment lawyer.