Salary Transparency Has Arrived. Companies Are Catching Up.

The law will be enforced by the city’s Commission on Human Rights; employers face fines of up to $250,000 if they do not comply after a first offense.

“The transition is hard,” said Kathy Wylde, who runs the Partnership for New York City, a consortium of business interests. “An employee in a low-cost area where the salary range is lower, or where the labor market is different, will see what somebody with the same job title is getting paid in New York City and may feel they’re not getting what they deserve.”

But to many workers and business leaders, the disruptions that result from salary transparency simply confirm the need for the laws.

“Compensation was a black-box exercise historically, shrouded in confidentiality and, therefore, tightly in the control of the employer,” said Allison Rutledge-Parisi, senior vice president of people at Justworks, a human resources technology company.

Studies have shown that people are more likely to apply for roles that include salary ranges. About 60 percent of job postings on Indeed include salary information, and those that do see about 30 percent more people starting applications. Three-quarters of job seekers say they’re more likely to apply for a posting that includes a salary range, according to an Indeed survey from April.

Starting Tuesday, Indeed will no longer share new job postings in New York City that don’t have salary ranges. The company pointed out that job seekers will be able to filter out positions below their pay standard.

Still, salary transparency isn’t a panacea.

Loren Furman, the chief executive of the Colorado Chamber of Commerce, said that some companies in the state have posted wide salary ranges so they have more flexibility in offering salaries based on a candidate’s performance and experience. There is no provision in the New York City, Colorado, California or Washington laws that prevents employers from going outside the advertised range when making a job offer.

Article source: https://www.nytimes.com/2022/10/29/business/nyc-us-salary-transparency.html