Pay range disclosure laws are spreading throughout the country, but perhaps nowhere faster than in New York and New Jersey.
On June 3, 2022, the New York State Legislature passed Senate Bill 9427A (the “NYS Bill”), following New York City’s lead earlier this year in enacting a wage disclosure law (as amended, explained here). Similar legislation was also recently enacted in the New York localities of Westchester County and the city of Ithaca, as well as in Jersey City, New Jersey. The new and proposed laws across the local and state levels are similar in many respects, but key differences are described below.
New York State
If signed by Governor Kathy Hochul, the NYS Bill would impose a twofold requirement on employers, including employment agencies, employees acting on behalf of their employer, or agents of employers, for postings with respect to jobs, promotions, or transfer opportunities (collectively, “employment opportunities”) that can or will be performed, at least in part, in New York State. The NYS Bill defines “employer” as an entity employing four or more employees. The NYS Bill purports to apply to remote employment opportunities so long as the job can or will be performed at least in part in New York State. We understand that the sponsors of the NYS Bill worked closely to match the legislative language to the New York City wage disclosure law that will become effective on November 1, 2022.
First, New York State employers would be required to disclose the compensation or a range of compensation on the advertisement for such employment opportunities. The NYS Bill defines “range of compensation” to mean the “minimum and maximum annual salary or hourly range of compensation” that the employer in “good faith believes to be accurate at the time of the posting of an advertisement” for such employment opportunity. Unlike the NYC law, disclosing a fixed compensation (e.g., $15/hour) would be permissible. If a position is commission-based, employers would only need to disclose a general statement that compensation will be based on commission.
Second, and as an additional requirement over the New York City law, employers would also be required to disclose the job description, if one exists, for an employment opportunity. The NYS Bill as drafted does not define “job description,” but notably, the NYS Bill would not require employers to create such job descriptions for each employment opportunity. Instead, the job description disclosure requirement only applies if a job description exists.
Additionally, employers would be required to maintain records of the history of compensation ranges and the job descriptions (if they exist) for each employment opportunity. Lastly, The NYS Bill’s anti-retaliation provision would prohibit employers from refusing to interview, hire, promote, employ, or otherwise retaliate against an applicant or current employee for exercising any rights under the NYS Bill.
If signed by the governor, the NYS Bill will take effect 270 days thereafter. While the NYS Bill was passed by the legislature on the last day of the 2021-2022 Legislative Session, it has not yet been delivered to the governor for signature.
City of Ithaca, New York
On May 4, 2022, the city of Ithaca in central New York also enacted pay disclosure requirements for employment opportunities (Ithaca City Code § 215-3(F)) (the “Ithaca Ordinance”). The Ithaca Ordinance, set to take effect on September 1, 2022, requires employers with four or more employees “whose standard work locations” are in Ithaca to include in postings for employment opportunities the minimum and maximum hourly or salary compensation for such opportunity. Employers with fewer than four employees in Ithaca are not covered by the Ithaca Ordinance. The posted range must represent the employer’s good faith belief at the time of the posting. While the Ithaca Ordinance does not directly address its application to remote positions, presumably, the law will not apply to remote positions unless there is a specific expectation that the position be performed by an Ithaca resident. Similar to the NYC law, the Ithaca Ordinance does not apply to a job advertisement for temporary employment at a temporary help firm.
Westchester County, New York
On May 10, 2022, Westchester County (just north of New York City) amended its human rights law to enact pay disclosure requirements (Westchester County Laws § 700.03) (the “Westchester Law”), set to take effect November 6, 2022. While the disclosure requirements are the same as those enumerated in the Ithaca Ordinance, the Westchester Law applies to employers that post “for positions that are required to be performed, in whole or in part, in Westchester County, whether from an office, in the field, or remotely.” The Westchester Law applies to employers with four or more employees. The Westchester Law does not clarify whether all four employees must work within the County.
Similar to the NYC law and the Ithaca Ordinance, the Westchester Law does not apply to a job advertisement for temporary employment at a temporary help firm. Moreover, Westchester County defines “posting” as “any written or printed communication whether electronic or hard copy, that the employer is recruiting and accepting applications for a specific position,” but the law does not apply to general “help wanted” signs or similar communications.
Jersey City, New Jersey
Just across the Hudson River from lower Manhattan, Jersey City likewise enacted pay disclosure requirements in March 2022 (Jersey City Ordinance 22-026), but those requirements were subsequently amended by Jersey City Ordinance 22-045, effective June 15, 2022 (the “Jersey City Ordinance”) to broaden the law’s coverage to include any employer within Jersey City, not just those who identify Jersey City as their “principal place of business.” The salary information that must be posted under the Jersey City Ordinance is similar to that required by the Ithaca Ordinance and under Westchester Law. The pay disclosure requirements apply to employers, employment agencies, and agents of covered employers with five or more employees within Jersey City. As amended, the Jersey City Ordinance specifies that the employee count must include any independent contractors working “in furtherance of the employer’s business” on the date of the notice or advertisement. Unlike the aforementioned enactments, the Jersey City Ordinance purports to apply to any advertisement, including notices regarding temporary employment opportunities. The Jersey City Ordinance is silent on whether it applies to Jersey City employers hiring for fully remote roles.
What Employers Should Do Now
Employers throughout the New York metro area should prepare to comply with the various local and state pay range disclosure laws, even though the NYS Bill has yet to be enacted. Specifically, employers should do the following:
- Review upcoming employment opportunities (open positions, promotions, or transfers), and determine the pay you would reasonably set for an applicant or employee in that role.
- Review and revise job descriptions.
- Consider conducting a pay equity audit.