More Job Ads Include Pay Ranges But California Mum on Scofflaws

Employers have largely embraced a 2022 California law that requires disclosure for job salaries for open positions, but there remains a lack of compliance along with questions over enforcement.

About 70% of California job postings on the website Indeed included salary information as of this summer, up from about 33% just one year earlier before the law took effect Jan. 1, the company says. While the pay transparency trend has been most pronounced in California, it is also reflected in job listings around the country as larger employers embrace pay transparency policies to navigate what has become a patchwork of rules across the six states that have passed such laws. Still, the trend is most pronounced in the Golden State.

More than half of all job openings on Indeed now include salaries, according to the company.

Still, it is common to see job advertisements in California that don’t include salary information and regulators appear to have less of a priority in enforcing the new rules compared to pursuing other labor violations, such as large wage theft cases.

Backers contend such laws can help combat pay inequity by providing a measure of fairness for job applicants, bringing information about employment practices into the open and challenging yet another convention of the pre-Covid workplace.

State Senator Monique Limón (D), who authored the California law, said she still wants to expand pay transparency, but argued that proof the policy is working can be found in job listings.

“The impact of this legislation is evidenced in the increase in salary ranges that are popping up in almost every sector in multiple states, giving employees and employers an opportunity to negotiate salaries,” she said.

New Laws, Tight Market

When Colorado legislators passed the first such pay transparency law in the country, which went into effect in 2021, some employers pushed back by excluding applicants from Colorado. Regulators there have also cracked down on companies by levying fines, including big brands such as Tesla Inc. and Charles Schwab Corp.

But as other states have passed similar laws, including New York, Washington, Illinois, and California, employers do not seem to be avoiding pay transparency requirements in the same way as when Colorado’s law first went into effect, said Helena Almeida, vice president and managing counsel at the payroll processing firm ADP.

That reflects not just a growing number of states passing pay transparency laws but also a labor market where workers are increasingly expecting employers to disclose salary information.

“We have the legal push and we have employees who are expecting more transparency,” she said.

Laws vary by state but California’s measure (S.B. 1162) requires any employer with more than 15 employees to include a pay range in job advertisements. The law expanded on an existing state requirement that employers provide the pay range for a job at the request of an applicant.

The state labor commissioner is tasked with investigating complaints about violations of the law and has the power to mete out civil penalties of up to $10,000 per infraction.

But those searching LinkedIn for jobs in the Sacramento area, where the commissioner’s office is headquartered, can find plenty of postings that do not include a salary range, and job boards don’t tend to require such information.

While clearly advertised pay grades have long been common practice in the public sector, the law marked a bigger shift for the private sector.

A casual search for job postings potentially violating state law turns up listings. They include a midsize regional accounting firm; a company that provides environmental site assessments; and a firm that handles hazardous waste inspections for government agencies.

The California Department of Industrial Relations, which includes the labor commissioner’s office, did not provide information about the number of complaints it has received under the new law, nor how many violators it has fined.

While it may also be too soon to determine if the California law is succeeding in narrowing wage inequality, Almeida said the measure and similar state legislation has at least given job applicants more leverage.

“There’s these different things that change who has the power,” she said.