A new report reveals that some companies are reducing salaries in job postings as pay transparency laws come into effect.

• Due to pay transparency laws, employers are reducing the salary ranges they advertise.
• While some firms are not complying with the new laws, others are posting pay even when not required.

Over the past few years, more employers have been disclosing salary ranges in job descriptions due to state and local pay transparency laws.

According to a report from job posting service ZipRecruiter, the growth of advertised wages for new hires is slowing, and in some cases, it's reversing, with companies now posting lower pay ranges.

Some jobs go unfilled as employers lower pay ranges

Despite offering higher wages for two years, some companies are still unable to fill certain positions due to candidates' demands for higher pay. However, nearly half of recruiters and hiring managers surveyed by ZipRecruiter in the summer of 2021 have lowered pay bands for some roles in the past year.

Julia Pollak, chief economist at ZipRecruiter, stated that employers are attempting to adjust candidate expectations.

In 2024, there is a forecast for wage growth that is "radically different." Many workers desire a 4-day workweek, while other job perks may be more attainable. Despite this, credit scores reached an all-time high, yet households are still falling deeper into debt.

During the Covid-19 pandemic, when labor shortages were severe, employers were offering higher salaries and signing bonuses to attract new workers. However, this practice created problems for existing employees.

Pollak stated that while the team was highly competitive externally, they were jeopardizing internal equity and incentives. He emphasized the importance of yearly salary growth to retain and motivate employees.

Some employers don’t follow pay transparency rules

Since 2021, the compliance rate for new state pay transparency laws is around 70% in states that have had such laws in place. However, about 30% to 40% of employers are not adhering to these laws, according to Revelio Labs, a workforce analytics firm.

In Washington state, individuals can file a complaint or initiate a civil lawsuit against a company if they fail to adhere to the law. According to the state Department of Labor & Industries, they have received 307 complaints this year and are currently investigating 39 of them.

Numerous class action lawsuits have been filed against companies in Washington that are allegedly not in compliance. Attorney Timothy W. Emery, partner at Emery Reddy, a Seattle-based workers’ rights law firm, has filed dozens of lawsuits against employers in the state.

"We have received numerous clients who are still experiencing pay disparities, and we have decided to take immediate action to put an end to these unlawful practices," stated Emery.

Other companies post pay even when not required

Nearly 40% of companies have complied with pay transparency laws, even in states where it is not required, according to Revelio Labs data.

As remote work becomes more prevalent, employers are struggling to navigate the complexities of complying with varying state and local regulations, according to Lisa Simon, chief economist at Revelio Labs.

Salesloft, an Atlanta-based revenue workflow platform, pays for all job postings in the U.S.

Katie Cox Branham, vice president of people at Salesloft, stated that they do not want to waste anyone's time by taking them through a whole interview process.

The company also benchmarks salaries on an annual basis.

During our annual merit increase, we evaluate the salaries of our current employees and make necessary adjustments to maintain pay equity with new hires, as Branham stated.

Talking about pay is no longer taboo

Employers are now required to post salary ranges in job postings, while employees are increasingly open to discussing their pay with peers.

Erica Keswin, a workplace strategist, speaker, and author, stated that Gen Z, the newest generation entering the workplace, are demanding pay transparency.

To motivate their workers, companies should have a comprehensive strategy that includes flexible work arrangements, family-care benefits, and opportunities for growth and development.