On January 15, 2022, New York City enacted a new law amending Section 8-107 of the New York City Administrative Code which requires New York City employers to disclose salary ranges for each job posting it advertises. Accordingly, it will be considered an “unlawful discriminatory practice” under the New York City Human Rights Law (“NYCHRL”) for an employer to advertise a job, promotion, or transfer opportunity without stating the position’s minimum and maximum salary in the advertisement. As such, an employer may be subject to civil penalties for violating these provisions. In response to lobbying efforts of business groups in the City, lawmakers agreed to delay the original effective date of May 15, 2022 to November 1, 2022 providing more time for employer preparations.
Purpose of the law
This law aims to promote greater salary transparency in the hiring process and to combat the gender pay gap and other potential discrimination. A similar bill has been proposed by both chambers of the New York state legislature. Additionally, several other states around the country have adopted similar laws as well.
What the law entails:
- Applies to external job advertisements, as well as, postings for internal transfer or promotion opportunities.
- Salary ranges listed in job postings may reflect the highest and lowest salary that the employer believes in good faith it would pay for the advertised position at the time of its posting.
- In the event of a first violation, employers are entitled to a warning with 30 days’ notice to remedy before facing a penalty.
- Only current employees of an organization/company have standing to sue.
Covered employers
This law applies to employers (and their agents) with four or more employees. Independent contractors working in furtherance of the employer’s business enterprise are included in the employee count. The law, however, does not apply to job advertisements for temporary employees. Further, and of great concern to many businesses, lawmakers agreed to exempt job advertisements for remote positions, which solicit workers who would not perform work in New York City.
Uncertainties
Uncertainties remain. First, it is unclear whether salary ranges should include discretionary bonus amounts. It is also unclear if the law applies to employees who live outside of New York City but work for employers based in the City and vice versa.
Recommendations
In order to be compliant by the effective date, it is recommended that employers start doing the following:
- Review and evaluate current and pending job postings and other relevant communications, including advertisements/communications from recruiting partners;
- Conduct an internal audit of employee salaries to assess any existing discrepancies that should be addressed; and
- Assess whether current employee salaries are competitive within its respective market/industry and be prepared to discuss the basis of salary ranges with applicants who may have knowledge of other salary ranges for comparable positions.
[1] The author thanks law clerk Naomi Gulama for her assistance in preparing this client alert.