Salary Transparency Laws:- Compensation for work has been a hot topic in the recent few years. The New transparency laws aim to reduce the inequity at work and discard the idea of asking salary history from employees. It is advantageous to both employees and employers.
This Anti Salary Secrecy law requires the employers to disclose the salary range to the employees to promote transparency at work.
It all Commenced in 2021 when Colorado enacted the first Equal Pay for Equal Work Act which mandates businesses to reveal the salary ranges on Job ads. Until then, there were no such laws Prevailing in US jurisdictions.
Following Colorado, New York made its own pay range law in November 2022.
Several states and cities walked on the same steps and required employers to list the salary ranges during the hiring process. Till 2023, there were almost 30 states that had one or other form of state transparency laws.
The Salary Transparency Act and Pay Equity for All Act was finally introduced in Congress in March 2023 which if passed requires both federal and state employers in the US to promote equity and transparency by disclosing the salary to the new candidates as well as the old workers essentially. However, it will be quite difficult to comply with a single law in all 50 states due to the different employment rules in different states.
There is already an Equal Pay Act of 1963 at the federal level relating to equal pay for equal work. But its scope is limited.
The good news is that with time, more and more states are making their own transparency laws.
Pay Transparency laws effective from 1st Jan 2023
California, Washington, New York and Rhode Island have made their pay transparency laws effective from 1st January 2023.
California amended the labor code
California’s amended labor code requires employers with a minimum of 15 employees to declare the salary ranges either on the third-party website or on the hiring page of the company. Upon the request of the employee, the employers are also bound to provide the pay scale for their current job.
Washington equal pay and opportunities act
The Equal Pay and Opportunities Act of Washington has almost the same requirements as California’s amended labour code. It also mandates that employers having 15 or more employees reveal the salary for a job as well as the other company benefits such as health care benefits, permitted leave and retirement benefits either on the company hiring page or on a third party site. The applicability of the Act is restricted to companies having a minimum of one employee based in Washington.
Rhode Island amended the Pay Equity Act
Rhode Island has amended its Pay Equity Act and it is somewhat different from other state laws and rules. It doesn’t direct the employers to post the salary range rather asks them to provide it whenever asked for either by a new candidate or by a current employee. They are also bound to provide the salary information if asked for when an employee’s position is changed.
New York State
The New York Transparency Bill came into effect in September 2023. It requires employers with four or more employees to provide the salary for the jobs and the promotions.
Salary Transparency Laws became effective from 1st January 2024
Colorado Pay Transparency Amendments
Colorado came up with the new Equal Pay Transparency rules in June 2023 and certain amendments had been made in the earlier Equal Pay for Equal Work Act which will come into effect from 1st January 2024. It defines the terms such as Career Progression and Career Development. As per the Act, All employers while posting any vacancy must disclose the pay range and the details of all other benefits that the company is going to provide to the employee. It is also essential for the employers to mention the last date of the job application and about the promotion opportunities.
Hawaii
Hawaii’s Senate Bill requires employers with 50 or more employees to list the hourly rates or expected salary ranges. It gives relief to employers with less than 50 employees, compensation decided under collective bargaining and the public employee’s positions.
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