The Rise of Pay Transparency Laws: What Employers Should Know

Discussing pay can be a taboo topic for both employers and employees – but one that is definitely circulating the nation (and world). While employee pay and individual income are considered complex and private topics by many, the taboos against discussing these topics are diminishing among younger workers. Importantly, the NLRA forbids employers from punishing rank and file employees from willingly discussing and comparing their own pay. Pay transparency is not only an important tool for union organization, but, its advocates say, for combatting the allegedly systemic pay gaps. To this end, many state and local governments in the U.S. are implementing laws mandating salary disclosures in job advertisements. Some companies, like Google and Microsoft, have publicly committed to posting salary ranges too, even if they do not operate in the states that require it. As of present, ten states have some version of pay transparency laws and (spoiler alert) more are on the horizon.

Below is a brief overview of each state’s requirements – this list does not include a comprehensive guide to all requirements, but highlights portions covering wage/salary disclosures. As these laws are constantly evolving, it is important for employers of all states, even those in states who have not adopted these laws, to keep up to date on the regulations and requirements. It is also important to note that many of these laws apply to employers who recruit within the state or employ remote workers living in the state that requires disclosures.

States with Pay Transparency Laws: California, Colorado, Connecticut, Maryland, Nevada, New Jersey, New York, Ohio localities, Rhode Island, and Washington.

California: California requires mandatory pay scale information for job postings. Employers with 15 or more employees are required to include the pay scale of a position in all job postings, including those jobs that can be done remotely in another state. Additionally, the law requires employers to provide the pay scale for the position held by an employee upon their request.

Colorado: Colorado employers of one or more employees are required to post the salary range (and general benefits) on job ads for all jobs that will or may be obtained in Colorado.

Connecticut: Connecticut must provide a salary range to employees upon request or within the offer of employment, whichever is first.

Maryland: Maryland employers must provide its employees with salary range/information upon the employee’s request. Additionally, Maryland prohibits employers from preventing employees (or applicants) from inquiring, discussing, or disclosing wage/salary information.

Nevada: Nevada requires employers to automatically provide salary ranges to applicants after the interview process, with or without a request. Additionally, employers must provide salary ranges for employees in a transfer/promotion position if the employee so requests, pending the employee applied and completed an interview.

New Jersey (Jersey City): New Jersey requires employers with 5 or more employees in Jersey City to disclose the minimum and maximum salary or hourly wage, and benefits for each job, promotion, or transfer.

New York: New York requires employers to post salary ranges in all job ads and promotions within New York State. Many localities/cities within New York have their own guidelines regarding pay transparency, including New York City and Westchester.

Ohio localities (Cincinnati and Toledo): While Ohio does not have a universal pay transparency law, Cincinnati and Toledo have adopted their own. In both localities, employers with 15 or more employees must provide salary ranges for a position upon request of the applicant if an offer is extended. 

Rhode Island: Rhode Island recently expanded its pay transparency to require all employers to disclose salary/wage information (1) upon applicant’s request – prior to discussing compensation, (2) upon employee’s request, and (3) upon hire/when employee moves into the position.

Washington: Washington requires employers with 15 or more employees (and at least one in Washington, engaging in business in the state or recruiting for the same) to disclose minimum/maximum salary ranges (and benefits) on jobs ads within the state, including remote work. Additionally, employers must provide salary ranges/information to applicants upon request after the offering of a position and upon request of an employee in a transfer/promotion position.

Key Takeaway: These laws are not going anywhere – it is quite the opposite. Be sure to stay informed on your state’s laws and regulations and comply with the same.

If you would like to have a current policy or practice reviewed or want to discuss these laws further, you can contact McKenzie Meade at (205).323.9279 or at mmeade@lehrmiddlebrooks.com.