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NYC Pay Transparency Changes Poised to Shape Job Ads Nationally

April 27, 2022, 9:05 AM

The details of how and when New York City employers must provide pay ranges in their job ads could become clearer within the week—and help shape the way employers advertise job openings nationwide as remote work grows.

A city law, passed in January, is aimed at helping prevent pay discrimination against women and workers of color. Now, pending revisions would give businesses a measure of relief by restricting job applicants from suing employers over their job ads and preventing fines for first-time violations if an employer corrects the problem within 30 days.

The revamp would also push back the law’s effective date from May 15 to Nov. 1.

But the latest proposal stops short of the more sweeping revisions that a New York City Council committee considered earlier this month, such as exempting small businesses under 15 employees and letting businesses post a general “help wanted” listing without including salary information.

The majority-female council could vote on the proposed changes as soon as April 28.

Barring further revisions, the law will apply to any employer with four or more employees advertising a position that could be performed in New York City—whether in person or remotely.

That means employers around the country will have to comply with the law when advertising increasingly common work-from-anywhere positions while complying with varying job ad and salary disclosure requirements in other states, said Felice Ekelman, a labor and employment attorney with Jackson Lewis in New York.

“Pay transparency laws are really on the rise. Many jurisdictions have them. Many jurisdictions are contemplating them,” Ekelman said. “Employers really need to look at this, because with the expansion of remote work many employers may be covered by these laws and not realize it.”

Gray Areas

Like New York City, at least seven states have enacted laws requiring some degree of salary transparency to job applicants. In a few cases, such as in Colorado and a newly revised Washington state law, employers must include a salary range in their job ads. In other states, including Connecticut and Nevada, companies must provide the information at certain points in the hiring process.

Still, “there are dozens, I would say, of gray areas,” in the NYC law, and the city hasn’t done much to answer those questions in the past three months, said Eli Freedberg, an attorney with Littler in New York. “Our clients always want to do the right thing; they just don’t know what it is.”

Although the proposed amendment would clarify some points, “There are still considerable ambiguities, not least of which, how does an employer create a good faith salary range,” Freedberg said. “It’s also not clear at all that the amendment will pass.”

The proposal before the council protects the original measure’s main purpose of helping to prevent pay discrimination while answering some of the business community’s concerns, such as giving them more time to comply, Council Member Amanda Farías said.

“As a young woman of color trying to work in government and the nonprofit sector, I went through multiple phases of interviews without knowing what I would be offered,” Farías said. Ultimately, she received offers too low to cover her costs of living in New York.

Closing the Gap

Andrea Johnson, state policy director at the National Women’s Law Center, agreed that the latest version of revisions would achieve the law’s pay transparency goals, after testifying against the previous proposal in early April.

“A lot of states, localities are looking to New York City as a leader on this issue,” Johnson said in a phone interview. Requiring employers to be upfront about wages when advertising job openings “is seen as such a crucial tool in closing the wage gap.”

Employers expected that the city’s Commission on Human Rights would issue formal rules giving more detail about compliance and enforcement, Littler’s Freedberg said, but it hasn’t. The commission will enforce the pay disclosure measure as part of the city’s broader anti-discrimination laws.

The commission issued a two-page fact sheet in March answering common questions about the law. An attorney for the commission also spoke to the question of remote jobs during the Council’s April 4 hearing on proposed amendments.

“If an employer is going to be posting a job that can be performed remotely from New York City, they would be expected to comply with our law, as is the case with many other laws across the country,” said Katherine Greenberg, special counsel to the commission.

To contact the reporter on this story: Chris Marr in Atlanta at cmarr@bloomberglaw.com

To contact the editor responsible for this story: Andrew Harris at aharris@bloomberglaw.com, Melissa B. Robinson at mrobinson@bloomberglaw.com