After much debate and delay, New York City’s salary range transparency law is now in effect. Starting November 1st, organizations with four or more employees (including owners & contractors) must provide a ‘good faith’ salary range for any internal or external job posting, job advertisement or transfer opportunity that will be performed all, or in part, in NYC. This law also includes third parties like employment agencies who are posting or recruiting for positions on behalf of a company.
Good Faith Salary Range
Employers are expected to provide a good faith salary range – one that they believe is reasonable for a qualified candidate to receive a job offer. The salary range only applies to a base salary or base hourly rate. It does not apply to total compensation, including bonuses, commissions, overtime, stock options, retirement contributions, etc.
The range must be expressed in a minimum and maximum amount and cannot be open ended. For example, employers will be prohibited from listing jobs as up to $100k, based on experience, $100k+, competitive rate / salary. The only exception is for jobs without any rate flexibility – i.e. the minimum and the maximum rate or salary is the same, $45 / hour.
This law applies to any job that can or will performed entirely or partially in New York City. This means that employers outside of NYC should include target salary ranges in ads for remote positions unless the job expressly cannot be performed in NYC.
Job Posting Obligations
This law does not force employers to post job ads internally or externally. Should an employer decide that they don’t want to disclose the salary range for a particular position, they can forego advertising for the job. However, in NYC and in many other states / cities, applicants have the right to request a salary range for a specific position for which they are applying.
Enforcement and Penalties
Enforcement will largely be based on reports from the public directly to the New York City Commission on Human Rights. Complaints or tips will be investigated by the NYCCHR, or in some cases by the Law Enforcement Bureau. Individuals are also permitted to file a lawsuit in civil court.
A civil penalty will not be assessed for a first complaint of violation, providing that the employer shows that they have rectified the violation within 30 days of receiving notice. Otherwise, penalties can range from monetary damages, employee training, or amending advertisements. Civil penalties will reach up to $125,000, which may be increased up to $250,000 if the NYCCHR determines that the employer’s non-compliance was a “willful, wanton, or malicious act.”
The Future of Salary Transparency
New York City is not alone in its salary transparency laws. California’s expanded salary transparency law (including salary range requirements) goes into effect January of 2023. Likewise, NY state lawmakers passed a similar bill that would require private sector employers to disclose salary ranges. If signed by the Governor, it would likely take effect in March of 2023. Colorado also has a similar law in place and several states and cities already require employers to disclose salary ranges to applicants upon request.