New York State Enacts Pay Transparency Law

Sign Up for our Pay Equity mailing List. 

Seyfarth Synopsis:  On December 21, 2022, New York State Governor Kathy Hochul signed legislation that will require employers to disclose salary ranges in advertisements for jobs, promotions, or transfer opportunities.  The law will become effective September 17, 2023.

New York State has become the latest jurisdiction to join the growing list of jurisdictions requiring pay transparency in job postings.  Under the new law, employers that advertise a job, promotion, or transfer opportunity must include: (1) the compensation or a range of compensation for such job, promotion, or transfer opportunity; and (2) the job description for such job, promotion, or transfer opportunity, if such description exists.  “Range of compensation” is defined as the minimum and maximum annual salary or hourly range of compensation for a job, promotion, or transfer opportunity that the employer in good faith believes to be accurate at the time of the posting of an advertisement for such opportunity.  However, for roles paid solely on commission, the law specifies that an employer will be in compliance if it discloses in writing a general statement that compensation shall be based on commission.

In addition to the disclosure requirements, the law contains an explicit non-retaliation provision, and new record keeping requirements.  Specifically, employers must keep and maintain records including, but not limited to, the history of compensation ranges for each job, promotion, or transfer opportunity and the job descriptions for such positions, if such descriptions exist.

Employers with four or more employees must comply with the law.  The law does not state, however, whether only New York employees count toward that threshold.  It is possible that that New York will take a more expansive view given how New York’s labor law is generally applied.  Similar to the New York City law, on which we reported here and here, the State law also applies to employment agencies and the employees and agents of employers and employment agencies.  But the law does not apply to “temporary help firms,” as such firms are already required to provide wage range information in compliance with the New York State Wage Theft Prevention Act.

The law will become effective 270 days after enactment, which will be on September 17, 2023.

Enforcement and Penalties

Any person may file a complaint with the state Commissioner of Labor (the “Commissioner”).  Employers who fail to comply with the statute face civil penalties up to $1,000 for a first violation, $2,000 for a second violation, and $3,000 for a third or subsequent violation, depending on the employer’s size, good faith, history of previous violations, and the gravity of the violation.  There is no private right of action.

Additional Guidance and Outreach Is Forthcoming

The law empowers the Commissioner to promulgate rules and regulations to effectuate the law’s provisions.  In addition, the law directs the New York State Department of Labor (the “Department”) to conduct a public awareness outreach campaign, which will include making information available on the Department’s website and otherwise informing employers of the law’s requirements.

What Does This Mean For The Other Local New York Laws Already In Effect?

The New York State law does not supersede or preempt any provisions of local law, rules, or regulations.  Accordingly, the wage range disclosure laws in Albany County, New York City, and Ithaca County will continue to apply to employers in those jurisdictions.  However, the Westchester County law states that it will become null and void on the day that similar statewide legislation goes into effect.  As such, the Westchester County law will no longer apply as of September 17, 2023, and employers in that jurisdiction would instead comply with the state law requirements.  The good news for employers is that the local New York jurisdictions seem to be aligned with the statewide requirements.

Next Steps For Employers

New York State employers should take immediate steps to ensure that they are ready to comply with the law on September 17, 2023.  While multi-state employers may already have pay disclosure practices in place to comply with other jurisdictions’ laws, the New York law further emphasizes the nationwide trend toward greater transparency, and will require employers to take an even harder look at pay transparency within their organization.  

Employers should evaluate the practical implications of adding appropriate pay ranges to their job postings, and train hiring managers, talent acquisition professionals, and human resources employees on the requirements of the law.  Employers should also consider conducting an internal evaluation of employee compensation to determine whether there are discrepancies that should be addressed before publishing pay ranges.

As always, Seyfarth’s Pay Equity Group is available to assist employers in navigating these new requirements and ensuring that they are ready for the ongoing trend toward greater pay transparency generally, including developing protocols for nationwide compliance.