Have you heard it’s “taboo” to talk about your salary? Us too. Well, that is out the window now. Welcome to the era of salary transparency. Yes, we know it can be awkward to talk about salary, but with new laws on the horizon, it may be a little easier to figure out how much your co-workers are getting paid.
Recently, the New York City Council passed a law requiring employers in New York City with four or more employees to list the minimum and maximum salary on all job posting including ads, promotions, and transfer opportunities. This law applies to any position that can or will be performed, in whole or in part, in New York City. This affects remote listings, meaning any job that could conceivably be done in New York City must follow this.
So why did the New York City Council deem this necessary? They passed this law to try and fight against big pay gaps, specifically between genders as well as between majority and minority racial groups. Let’s be honest, pay matters. It affects where you work and how long you decide to stay there.
The power dynamic shift with this law could be significant. Unsurprisingly, some businesses fought hard against this law; employers have long enjoyed the upper hand created by employees not sharing their salaries.
These businesses were worried and didn’t want this law to go into effect because they had no idea how their employees and future employees were going to take it. For instance, are employees going to be frustrated if they realize their colleagues make more? Will this take some power away from the employer when it comes to negotiations for job positions? These are all thoughts that have crossed HR officers’ minds as they prepped for this law to go into effect.
Many companies in New York City have performed internal audits to see what different positions at the company earn as well as re-write and update job postings to comply. The City has said employers should put a pay range that someone could make earning that job, but some of the pay ranges listed are so big it’s hard to make sense of. For instance, at PricewaterhouseCoopers, a tax director’s salary range was $189,000 – 416,000. This pay range seems meaningless without more clarity because what is ‘really’ possible for this role?
Who is going to police this law? The New York City Human Rights Commission will determine if these ranges are in good faith or if companies are even complying with the law. First, the City said it will issue companies a warning and allow them 30 days to correct the mistake without being fined. Then, if the salaries aren’t added or fixed, the company could face up to a $250,000 fine. The City has not laid out the parameters of what is considered “good faith” leaving room for all sorts of arguments to be made in the future.
Note that some companies have tried to get around the law by telling job seekers to send in their resumes instead of advertising the job openings. By doing this they would not be “posting” a job and thus would not have to disclose the salary range. In this super-tight job market, it is unclear if employers can use this workaround to get new employees or not because in this market it continues to be hard to hire.
If you’re a job seeker, you have a right to be frustrated when you go to somebody’s website and you don’t see pay. While this law may not be in the place where you live, it doesn’t take away from the fact you may feel like the employer is playing games by not disclosing pay.
This law may apply specifically to workers in New York City, but lawmakers say it will likely have a bigger impact on workers nationwide. Some job contracts prohibit people from talking about their pay! If you are in process of looking for a new job or getting ready to sign a new contract at work, consult us if you’re not sure if your job contract allows for pay transparency questions. You can book a consult at our website www.robwiley.com or by calling 214-528-6500