US lawmakers are anxious to address pay inequities by requiring transparency of employers. There are many regulations being considered in local and state-wide levels, each requiring a different transparency requirement for pay ranges, targeted pay and related issues.
A Colorado employment law took effect January 1, 2021 and requires employers to take a number of steps to help achieve gender pay equity. It requires employers to disclose targeted pay ranges in job postings. Among other rules, the law requires employers to inform all current employees of opportunities for advancement, new positions and pay ranges for available jobs. The act applies to businesses with at least one employee in Colorado. It is important to note, employers located anywhere in the country must disclose salary and benefits information in job postings for positions that will be or can be performed in Colorado. That includes remote jobs.
A newly adopted Connecticut employment law going into effect October 1, 2021 requires employers to provide wage range detail upon request. Under the new Connecticut law, an employer is prohibited from:
- Failing or refusing to provide an applicant for employment the wage range for a position for which the applicant is applying, upon the earliest of (a) the applicant’s request, or (b) prior to or at the time the applicant is made an offer of compensation.
- Failing or refusing to provide an employee the wage range for the employee’s position upon (a) the hiring of the employee, (b) a change in the employee’s position with the employer, or (c) the employee’s first request for a wage range.
The impact of this new legislation can be far-reaching. While drastic impact is often predicted, smaller, incremental change is typically the actual result of these newly installed initiatives. On the more radical side of the ledger, it seems that some job postings for remote work are now excluding Colorado-based workers to avoid the impact of the law on more national jobs. In other more extreme scenarios, employers are removing all wage scales and ranges to allow complete flexibility when factoring for the impact of the law. Targeted pay ranges are being listed as “open” to avoid defining a specific level.
Recruiters and employers will need to pay attention to the fast moving pace of change on all issues regarding salaries. NYC has a law forbidding the requirement of a criminal background check that is severely punished if posted in a job advertisement. NYC and dozen of other states and municipalities now have laws banning salary history questions and the use of salary history in playing candidates in pay ranges.
Is there anything you do as a recruiter or employer to foster better transparency around salary issues?