Salary Transparency Laws Aim to Combat Pay Disparities

NEW YORK (AP) — Starting this week, job-seekers in New York City will have access to a key piece of information: how much money they can expect to earn for an advertised opening.

New York will require employers as of Nov. 1 to disclose “a good faith salary range for every job, promotion, and transfer opportunity advertised,” according to the city’s Commission on Human Rights.

Similar salary transparency laws are being adopted by a small but growing number of cities and states across the country in an effort to address pay disparities for women and people of color.

Seher Khawaja, senior attorney for economic empowerment at Legal Momentum whose organization helped draft the New York City law, said salary transparency “gives existing employees and workers information to better gauge how positions within their workplace are valued and whether they’re being paid fairly.”

It also gives employers a way to avoid liability.

“It puts their feet to the fire to think about how they’re setting pay and to avoid discriminatory practices that were working their way in previously,” Khawaja said.

Haris Silic, vice president at Artisan Talent, a staffing agency that places hundreds of creative professionals in New York City and across the country, said the law’s implementation may initially be tough on the employer’s side, but he thinks “everyone sees the value.”

“Every employer was an employee once,” he said.

Business groups, including New York’s five borough chambers of commerce, have argued that the law could create “dissatisfaction in the workforce and demands to adjust existing pay scales that the employer may be unable to afford.”

“During a labor shortage, or in the context of achieving diversity goals, the posted maximum may be significantly higher than the historical salary ranges,” the groups wrote in a letter to the New York City Council.

Colorado was the first to adopt a salary transparency law in 2019, followed by California, Maryland, Nevada, Rhode Island, Connecticut, and Washington, as well as cities like Cincinnati and Toledo, Ohio.

Rules for salary disclosures vary. In some cases, they require employers to share the information upon request or after an interview, with exemptions for small businesses. In other cases, employers must post salary ranges.

In Colorado, for example, a recent job posting on hiring site Indeed for an executive assistant in Denver advertised a salary range of $57,131 to $88,516 a year. A human resources data analyst role listed a range of $67,488 to $111,355 a year. A retail position at Target advertised an hourly salary of $23.75 to $40.40.

New York City’s law is similar to Colorado’s, but it applies only to employers with four or more workers rather than all businesses. That accounts for one-third of employers in the city but roughly 90% of workers, according to state Labor Department statistics.

The new wave of legislation marks a shift in who bears the onus for making salaries transparent, with more employers now being held responsible for creating an open work environment instead of leaving it to employees to figure out how their pay compares to their coworkers and whether to ask for fair compensation, according to Andrea Johnson, director of state policy at the National Women’s Law Center.

In 2021, the median pay for full-time women workers was about 83% of men’s pay, according to federal data, and women make less than their male counterparts in nearly all fields. For women of color, the numbers are even worse. A report by the National Partnership for Women and Families found that Black women make 64 cents for every dollar paid to white, non-Hispanic men. For Latina women, it’s 54 cents and for Native American women, it’s just 51 cents.