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New York City Enacts New Salary Transparency Law

In its continued efforts to combat gender and race-based pay inequity, last month New York City enacted a new law that requires employers to disclose on internal and external job listings the expected salary range of a given position.  The new law takes effect on May 15, 2022.  Starting then, failure to include a good faith minimum and maximum salary range in advertisements or internal company postings constitutes unlawful discriminatory practice.

The law, which impacts employers with at least four employees or independent contractors, certainly covers any employment positions within New York City, but it is unclear whether it also would cover positions advertised in New York City for jobs physically located outside of the City, such as employees of a New York City based company who work remotely outside thereof.

Failure to adhere to the new law may result in damages stemming from employment discrimination lawsuits brought by applicants, as well as fines of up to $125,000, or more for intentional violations.  In addition to adhering to the rights of applicants and new hires, companies should also consider the impact of the law on current employees, and may wish to evaluate their current compensation.  The salary transparency law has the potential to stew discontentment by current employees if positions are advertised at greater compensation than current employees at comparable levels are making, which could cause current employees to consider whether  any discrimination in pay exists based on their lower salaries.

New York City law already prohibits unequal treatment in the terms and conditions of employment, including compensation, and prohibits employers from inquiring into employees’ or applicants’ salary histories.  But the new salary transparency law, while creating challenges for employers, provides additional protection in efforts to lessen the existence of pay inequities based on race and gender, and the law is expected to have a positive impact in pursuit of such equality.

To learn more, read the details on The New York City Counsel website here.

This article is intended only as a general discussion of these issues. It is not considered to be legal advice or relied upon in regard to particular legal matters. If you seek assistance with a particular employment law or labor law matter, please contact RPJ Partner Ethan Krasnoo to discuss.