Pay transparency, or pay disclosure, is a growing trend spreading across the United States. Pay transparency can mean a couple of different things.
It can mean the ability of employees to discuss their wages without fear of retaliation from an employer. The National Labor Relations Act (NLRA) federally protects employees who discuss wages, and there is a nondiscrimination provision in place for contractors doing business with the federal government. There are also at least 17 states with laws in place to protect employees who are open about their salaries.
Then there is pay transparency, or pay disclosure, as it relates to current job positions at a company, as well as job postings. These laws require companies in some states to disclose the salary range in their job postings, or at the request of an applicant. They are often intended to reduce pay gaps, such as the gap in pay frequently found between men and women who are doing the same work. They may also help employers build trust and morale among employees.
With this growing trend, it may be in an employer’s best interest to get ahead of the game by posting salary ranges on job postings. In a study by Adobe of recent and upcoming graduates, 85% of respondents are less likely to even apply for a job if a salary is not disclosed on a job posting.
When did the pay disclosure trend begin?
Whole Foods Market has had a full pay transparency policy since 1986. However, states did not begin requiring pay transparency until Colorado passed their law in 2019, which went into effect in 2021. Since then, at least 13 additional states and localities have joined in.
Which states require pay disclosure?
Full-time remote work is a reality for 35% of people in the U.S. Employers offering remote work can now recruit nationwide to fill these positions. However, it’s getting complicated as a patchwork of pay transparency laws begin to emerge. To remain compliant, organizations should regularly review current and upcoming laws regarding pay disclosure and transparency.
Here are the states and localities that have some form of pay disclosure law as of the time of this writing:
Employers with 15 or more employees, at least one residing in California, must include a pay range in all job postings.
Employers must include the pay or pay range in all job postings, if the employer has one or more employees residing in Colorado.
Employers with one or more employees residing in Connecticut must disclose a pay range for all current employees and to applicants, either upon request or in the offer of employment, whichever comes first.
Employers are required to provide a pay range at the request of an applicant. Employers can’t refuse to hire an applicant for requesting the pay range.
Employers are required to provide the pay range for a position to applicants who have completed an interview.
Jersey City, New Jersey
Employers with 5 or more employees and a principle place of business in Jersey City are required to disclose a pay range and a description of benefits on any job posting, transfer, or promotion opportunity.
Taking effect Sept. 17, 2023, employers with four or more employees must disclose a pay range for any job posting.
Ithaca, New York
Employers with four or more employees in Ithaca are required to disclose the pay range on any job posting, transfer, or promotion opportunity.
New York City, New York
Employers with four or more employees are required to provide a pay range in any job posting. It includes jobs for candidates who reside in New York City or jobs that could be performed in whole or in part in New York City.
Westchester County, New York
Employers with four or more employees are required to provide a pay range for any job posting, if the job is performed in whole or in part in Westchester County.
Employers with one or more employees in Rhode Island must disclose a pay range to applicants on request or at the time of hire, whichever comes first. Employers are encouraged to disclose the pay range prior to discussing compensation with the applicant.
Employers with 15 or more employees in Cincinnati are required to disclose the pay range for a job after making an offer if requested by the applicant. They cannot ask applicants about salary history.
Employers are required to disclose the pay range for a job after making an offer if requested by the applicant. They cannot ask applicants about salary history.
Employers are required to disclose a pay range in any job posting. There is also pending legislation in Massachusetts and South Carolina, and more states are likely to pass legislation over the next few years. Organizations should regularly review job postings and internal pay range procedures for employees to ensure compliance with each of these laws.