Governor Kathy Hochul signed into law S.9427-A/A.10477 in December, and as of September 17, 2023, this legislation is now in effect. The law, which passed primarily along party lines during the 2022 legislative session, mandates that businesses across the state of New York with four or more employees must incorporate compensation ranges in all job, promotion, and transfer opportunity advertisements.
Governor Hochul emphasized the significance of this pay transparency law, stating that it positions New York at the forefront of promoting fairness and equity in workplaces. Wage disparities, which have perpetuated inequality for a significant duration, particularly impacting women and people of color, are targeted by this legislation. It aims to level the playing field across the state and bridge the wage gap in New York.
Under this law, all job, promotion, or transfer opportunities performed, even partially, in New York state must include a pay range in their advertisements. This requirement extends to opportunities performed outside the state, including remote or telecommuting positions, as long as they report to a supervisor, office, or another work site within New York state.
Pay ranges should encompass the minimum and maximum annual salary or hourly compensation, believed to be accurate in good faith at the time of posting. Employers are also obligated to clearly indicate if a position is commission-based. This law serves as a pivotal step in ensuring employees have access to critical compensation information and the ability to make informed decisions regarding their careers.
Importantly, the law does not compel employers to create postings for every available opportunity, nor does it prescribe a specific medium for advertisements. It encompasses various advertising methods, including newspaper ads, printed flyers, social media posts, website listings, communications sent to electronic mailing lists, and emails distributed to multiple applicants. Third-party job sites are also required to include pay information in their postings.
While this legislation aims to enhance transparency and fairness in the workplace, it has faced opposition, particularly from Assemblyman Andrew Goodell, R-Jamestown, who voted against it on the Assembly floor. He believes that it may place an undue burden on small businesses, emphasizing that compensation negotiations often depend on an employee’s experience and the specific needs of the business.
A similar pay transparency ordinance has been in effect in New York City since 2022, with other states like California and Colorado passing similar laws. Compliance with the law may pose challenges, according to Frank Kerbein, director of human resources at the New York Business Council, who has criticized the law for adding administrative complexity for employers, especially small businesses. Kerbein predicts that there may be unintentional noncompliance due to limited awareness among small employers.