Companies of all kinds have closely guarded the prospective pay for their job opportunities for years, preventing employees from learning whether their coworkers earn more money than they do and keeping applicants in the dark about possible earnings. But for New York City, one of the largest job markets in the world, that practice will no longer exist!
A new city law that went into effect at the start of November will require companies with at least four employees to post salary ranges for openings, even if the jobs involve remote or hybrid work.
According to the law, when a position is published on an internal job board, as well as external websites like LinkedIn, Indeed, or other job search platforms, businesses are required to disclose the minimum and maximum income that is being offered for that position. Additionally, it applies to any written job description posted to newspaper classifieds, presented at job fairs, or printed on a flier.
This policy adds New York City to the increasing list of American cities that demand private firms to disclose their salaries. This practice began during the COVID-19 pandemic in an effort to better leverage workers during hiring—an already illusive and competitive process for many across the United States.
Salary requirements for job postings were introduced in Colorado earlier this year. California and Washington state will impose the same regulations in 2023. Another similar law to the one in New York City was passed by the New York State Senate in June, but Governor Kathy Hochul has not yet signed it into law.
Several large companies in the financial and technological industries have already updated their job postings to be in compliance with the new policy. Some corporations have gone further, such as Citigroup, which added salary information this month to all of its job openings in the United States, not just those in New York City.
But as with many laws, companies find loopholes. Some employers are listing extremely broad pay ranges. However, the argument is that businesses may need to offer a wide range if they’re open to people of varying experience levels and wish to be competitive in a tight job market.
Some worry that businesses will completely stop posting job openings online and instead rely on alternative methods of hiring and recruiting. Some businesses may decide to remove job listings and invite candidates to send their resumes to a general email address. Or, instead of advertising, some people may use employee search firms to identify applicants for them. Employers could also avoid compliance if they hire remote workers but say the job can’t be done from NYC.
However, if a company isn’t complying with the new law, job seekers and workers can file complaints or leave an anonymous tip with the city’s Commission on Human Rights. Businesses will have 30 days to fix the violation, otherwise, they could face civil penalties of up to $250,000.
Whatever the worries, most will agree this is a step forward to fair and transparent pay. Tae-Youn Park, an associate professor of human resource studies at Cornell University, said research on salary disclosure laws that have been implemented elsewhere, for example in Denmark, has shown that it helps narrow the pay gap between men and women. Time will tell whether the policy worked as intended.
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