New Expansive Pay Transparency Laws in Effect Now
As we reported here last month, significant changes to pay transparency laws have gone into effect this year. While these laws have been growing in popularity over the last few years, this is likely the first year that many multi-state businesses are finding themselves subject to multiple states’ and municipalities’ pay transparency laws and regulations. With so much change happening, it is important for businesses to make sure they are in compliance now to avoid fines and fees.
Effective in 2023
California: In California, Senate Bill 1162 mandates that employers with 15 or more workers are required to list salary ranges on job postings, including those posted on third-party websites. Upon request, a business must provide its current employees a pay scale for the position they hold with the company. In addition, employers with more than 100 employees in the state must demonstrate their mean and media pay data by gender, ethnicity, and racial categories.
Illinois: In Illinois, the deadline for the pay transparency requirements mandated by the amendments to the Illinois Equal Pay Act is fast approaching. On March 23, 2023, most employers with more than 100 employees must submit their application to the Illinois Department of Labor to obtain an equal pay registration certificate.
New York: On December 21, 2022, New York enacted a new pay transparency law that will go into effect on September 17, 2023. While pay transparency laws had previously been passed in municipalities across the state, this new law will apply to employers located in the State of New York with four or more employees. The law requires employers to disclose the pay range in advertisements for all positions that can be performed in the State of New York, including remote positions.
Rhode Island: Rhode Island’s newly amended Pay Equity Act went into effect on January 1, 2023. The amended Pay Equity Act requires businesses with one or more employees in the state to provide pay ranges for positions to job applicants and all current employees upon request. Additionally, businesses must disclose the pay range when they offer a position to an applicant, upon hire, and when an employee changes roles within the business. Businesses are also prohibited from requesting or relying on an applicant’s wage history during the hiring process.
Washington: In Washington, the Equal Pay and Opportunities Act – one of the most expansive pay transparency laws yet – went into effect on January 1, 2023. Like California’s law, the act mandates that employers with 15 or more employees disclose the pay range for any job postings made by the company or listed on a third-party site. Job listings must also include the benefits for which the employee would be eligible if hired. Unlike the California law, the Equal Pay and Opportunities Act law applies if the employer has even one Washington-based employee, engages in business in the state, or recruits for jobs that could be filled remotely by a Washington-based employee.
Other States with Pay Transparency Laws
The above-named states join Colorado (effective January 1, 2021), Connecticut (effective October 1, 2021), Maryland (effective October 1, 2020) and Nevada (effective October 1, 2021) in passing pay transparency legislation. In addition to the above seven states, multiple municipalities have their own pay transparency laws including: Cincinnati, Ohio; Ithaca, New York; Jersey City, New Jersey; Toledo, Ohio; and Westchester County, New York.
Finally, later this year, it is widely expected that Massachusetts, New Jersey, and South Carolina will pass pay transparency laws.
If you have any questions about pay transparency laws, please contact one of Honigman’s Labor and Employment attorneys.