What is the legal requirement for employers to disclose salary ranges during the hiring process?

In April, New York City will become part of the growing number of states and cities implementing salary transparency laws, as a bill requiring employers to post salary ranges for job openings, promotions, and transfer opportunities was passed by the city council in December.

Advocates and legislators have been pushing for greater salary transparency in recent years, as research shows that salary secrecy disproportionately harms women and workers of color, who are less likely to negotiate salaries or raises and ask for less when they do.

At least 14 states have laws that prevent employers from asking job candidates about their salary history, and 20 states and Washington, D.C. provide protections for workers to discuss pay. Advocates argue that more open discussions about pay, particularly employer transparency, can help reduce the gender and racial wage gaps.

Johnson advises CNBC Make It that it is crucial to shift the responsibility from job seekers to employers to establish fair payment structures.

Johnson advises job-seekers and employees to verify their state's Department of Labor websites for more details on transparency laws.

During the hiring process, employers are mandated to reveal salary ranges in certain states and cities.

California

The Equal Pay Act in California, enacted in January 2018, was the first in the nation to prohibit employers from inquiring about an applicant's past salary. Additionally, the act mandates that employers disclose the salary range for a position if an applicant requests it following an initial interview.

Cincinnati, Ohio

In accordance with Cincinnati's Prohibited Salary Inquiry and Use, as of 2020, employers in the city are prohibited from inquiring about an applicant's salary history. Employers are required to provide the pay range of a job after making an offer, and if the applicant requests it.

Colorado

Starting from January 2021, Colorado's Equal Pay for Equal Work Act mandates employers to include the pay range and benefits in every job advertisement. Employers with at least one worker in the state are obligated to disclose pay information for any remote job that could possibly be carried out in the state.

Employers must notify current employees of all promotion opportunities and maintain records of job descriptions and wages.

Connecticut

Starting from October 2021, employers in Connecticut are required to disclose the salary range if requested by an applicant or if an offer is extended, whichever comes first.

Employers must disclose the pay range to an employee upon hiring, when they are promoted to a new position, or upon request for their current role.

Maryland

In 2020, Maryland amended its Equal Pay for Equal Work law to prohibit employers from inquiring about candidates' salary history and mandate employers to reveal the pay range to applicants upon request.

Nevada

Since October 2021, Nevada employers are prohibited from inquiring about an applicant's salary history and must automatically provide the salary range after the initial interview, regardless of whether the applicant has requested it.

Employers must provide pay ranges for a transfer or promotion if an employee has applied for it, completed an interview, and requests it.

New York City

Starting from April 2022, New York City employers will have to include the minimum and maximum salary on all job postings, promotions, or transfer opportunities.

Rhode Island

In January 2023, the Rhode Island Equal Pay Law will mandate employers to reveal pay range information to candidates upon request during interviews. Employers must disclose the range for a role before discussing compensation.

Employees can request the salary range for their current position, while employers are obligated to disclose the salary range when an employee is promoted to a new role.

Toledo, Ohio

In 2020, Toledo's Pay Equity Act prohibited employers from inquiring about an applicant's salary history. Instead, employers were required to disclose the pay range for a job after making an offer, and applicants could request this information.

Washington

In 2019, Washington updated its Equal Pay and Opportunities Act to require employers to disclose the minimum and maximum pay range for a job after making an offer and upon request from the candidate.

Employers must provide a salary range or minimum expectation for internal transfers or promotions to existing employees upon request.

More pay transparency laws could be coming

According to Johnson, pay discussions have become more restricted since the financial crisis of 2008. The economic power dynamics in hiring shifted, with employers having more power and applicants having less. As a result, employers have become more tight-lipped about salaries.

Johnson remarks that despite the pandemic providing more job opportunities and flexible work, we are currently in a less transparent period.

The implementation of salary range laws is imperative in the current economic recovery due to the pandemic. Johnson emphasizes the need to ensure that women, employees of color, and low-wage workers, who have been disproportionately affected by job loss, are brought back into the workforce with the necessary support and equitable compensation. He suggests that the focus should be on rebuilding the economy in a sustainable manner that benefits both individuals and businesses.

Employers can save time by publicizing salaries, as it attracts job-seekers and eliminates those whose salary expectations do not align.

In states such as Massachusetts, South Carolina, and New York, there are currently more bills being considered.

Despite the Equal Pay Act of 1963 prohibiting pay discrimination based on sex, gender and racial wage gaps persist at the federal level. Efforts to strengthen fair pay laws through the Paycheck Fairness Act have been unsuccessful since its introduction in 1997. The House recently reintroduced and passed the legislation, but the Senate has not advanced it.

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