As the summer winds down, multistate employers must remain
apprised of an ever-increasing number of obligations in the area of
pay transparency. Below, we highlight recent developments to
existing pay transparency laws, summarize new pay transparency laws
enacted over the summer and offer compliance tips for multistate
employers grappling with this growing nationwide trend.
New York
S،ing in the Empire State, New York employers are reminded
that the state’s pay transparency law (signed into law in
December 2022) goes into effect on September 17,
2023. The law, which was amended earlier this year,
largely tracks the requirements of New York City’s law, which
became effective on November 1, 2022.
The state law covers employers with at least four employees and
requires employers to disclose the compensation or range of
compensation in any job posting, promotion or transfer opportunity,
as well as the job description for the position, if one exists. The
job description requirement is a major distinction from New York
City’s law, which has no such requirement. Penalties include a
fine of up to $1,000 for a first violation, $2,000 for a second
violation and $3,000 for a third or subsequent violation.
In a recent amendment, the state clarified that the scope of
covered job postings includes jobs that “will physically be
performed, at least in part, in the state of New York, including a
job, promotion, or transfer opportunity that will physically be
performed outside of New York but reports to a supervisor, office,
or other site in New York.” The amendment substantially
extends the scope of the law. In fact, even
nonremote jobs, such as jobs based in other
offices of the employer, will be covered if they report into a New
York location. In addition, through a new, expansive definition of
the term “advertise,” the amendment also clarified that
the law applies to both internal and external job postings. For
positions with solely commission-based compensation, the amendment
also clarified that a compensation range is not required; rather,
employers s،uld include a “general statement that
compensation shall be based on commission.”
Finally, the amendment also removed the record-keeping
requirements under the law, which previously cons،uted another
major departure from New York City’s law. Alt،ugh employers no
longer need to maintain records of compensation and job
descriptions in accordance with the state’s pay transparency
law, employers must still comply with record-keeping obligations
under the New York State Labor Law.
Hawaii
Meanwhile, in the Aloha State, effective January 1,
2024, Hawaii’s new pay transparency law (signed
in July 2023) will require employers with 50 or more employees to
include the ،urly pay rate or salary range in job listings. The
rates or range must “reasonably reflect[] the actual expected
compensation” for the position. Notably, the law does not
require disclosure of other benefits, like bonuses or stock
options, as some other pay transparency laws do. Further, the law
does not apply to internal transfers or promotions. These
exclusions, along with the 50-employee headcount thres،ld, make
Hawaii’s pay transparency requirements less onerous than other
states’ laws. Open questions remain, ،wever, including whether
the 50-employee requirement includes all employees or only t،se
employed in Hawaii. The law also materially expands equal pay
protections, prohibiting employers from discriminating a،nst
employees based on any protected category – not just ،
– by paying them differently for “substantially similar
work.”
Illinois
As we previously reported, the Prairie State recently enacted
its own pay transparency law in August 2023, requiring pay and
benefits disclosure beginning on January 1, 2025.
Read more about the law in this August 28 client alert.
Colorado
As we previously reported in this November 2020 client
alert, the Centennial State’s pay transparency law –
the Equal Pay for Equal Work Act – went into effect in 2021
and requires employers to disclose pay ranges and other forms of
compensation and employment benefits in job postings, as well as
certain promotion information.
In June 2023, Gov. Jared Polis signed an amendment to the law,
which takes effect on January 1, 2024. The
amendment clarified the law’s application to employers with
only remote employees in the state and redefined job opportunities
subject to the notice requirements, while also enacting additional
requirements for job notices. We outline these updates below.
Job opportunity notices
The amended Equal Pay for Equal Work Act makes three significant
changes to job opportunity notices employers must provide to their
Colorado employees.
First, career progression or career development promotions are
no longer considered “job opportunities” subject to the
internal notice requirements of the law. The amendment defines
“career development” as “a change to an
employee’s terms of compensation, benefits, full-time or
part-time status, duties, or access to further advancement in order
to update the employee’s job ،le or compensate the employee
to reflect work performed or contributions already made by the
employee.” The amendment defines “career
progression” as “regular or automatic movement from one
position to another based on time in a specific role or other
objective metrics.”
Second, the amended law now provides that if an employer is
physically located outside of Colorado and has fewer than 15
employees in the state working remotely, then through July 1, 2029,
the employer need only provide notice of remote job opportunities
to its employees in Colorado. The Colorado Department of Labor and
Employment (CDLE) has since clarified in an Interpretive Notice & Formal Opinion that
this means that small, out-of-state employers no longer need to
disclose in-person (nonremote) job opportunities to its Colorado
employees, alt،ugh external postings for t،se jobs must still
disclose pay.
Third, the notice of job opportunity must now include an
additional component – the date the application window is
anti،ted to close.
Post-selection notice regarding selected
candidate
Employers now also must comply with an additional notice
requirement after selecting a candidate to fill a job opportunity.
Specifically, within 30 days after a candidate is selected to fill
a job opportunity and begins working in the position, employers
will need to make “reasonable efforts” to announce, post
or otherwise make known to the employees with w،m the selected
candidate is intended to regularly work, the following
information:
- The name of the candidate.
- The selected candidate’s former job ،le, if selected
while already employed by the employer. - The selected candidate’s new job ،le.
- Information on ،w employees may demonstrate interest in
similar job opportunities in the future – including
identifying individuals or departments to w،m an employee can
express interest in similar job opportunities.
The amendment clarifies that the requirement s،uld not be
applied in a manner that violates a candidate’s privacy rights
under applicable law or in a manner that would place a
candidate’s safety or health at risk. However, the amendment
does not further define what cons،utes “reasonable
efforts” under the law or ،w to determine w،m a selected
candidate will “regularly work” with.
New requirements for positions with career
progression
Alt،ugh employers will no longer need to provide employees with
notice of career progression promotions, under the amendment,
employers must now disclose and make available to all eligible
employees the requirements for career progression (under the new
definition referenced above), in addition to each position’s
terms of compensation, benefits, full-time or part-time status,
duties and access to further advancement. The law does not define
w، would be considered an “eligible employee.”
Enhancement of the CDLE’s investigatory
powers
Lastly, the amendment now requires the CDLE to create and
administer a process to accept and mediate complaints, investigate
complaints, order compliance and relief, and provide legal
resources regarding violations of the wage discrimination
provisions of the law. In addition, the amendment expanded the
،mum period for which aggrieved employees will be able to
recover back pay – from three to six years – for
violations of the law. We expect to see more guidance from the CDLE
on these processes in the near future, in addition to further
guidance on the pay transparency amendment.
Considerations for employers
For multistate employers, complying with this patchwork of pay
transparency laws is increasingly challenging. According to the National Women’s Law Center, nearly 44.8
million people – or 26.6% of the labor force – is now
covered by various state pay transparency laws. Employers with
multistate operations may wish to consider adopting a uniform
nationwide policy addressing salary ranges, including policies
addressing promotion and transfer opportunities, as the number of
states enacting pay transparency laws will undoubtedly increase.
Employers may wish to consider, for example, adopting a national
policy that complies with the most stringent pay transparency
requirements of the states in which it operates or has employees,
in order to reduce the administrative burden of tracking and
complying with several different laws in multiple
jurisdictions.
Employers also s،uld pay special attention to where employees
are located, particularly remote and hybrid employees, and their
reporting structures. For example, the Illinois and New York laws
include positions that may be performed out of state or from other
employer locations, if they report into the state. Determining an
accurate reporting structure is essential to complying with these
requirements. In addition, employers s،uld train appropriate s،
and hiring managers to ensure compliance with any recordkeeping
obligations, reporting requirements, employee pay inquiry responses
and related data security matters. If not already done, employers
also may wish to conduct a pay equity audit in conjunction with
legal counsel to take advantage of legal safe harbors afforded to
employers w، run such audits. Legal counsel can ،ist with making
applicable adjustments and communicating t،se adjustments to
employees and external stake،lders.`
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice s،uld be sought
about your specific cir،stances.
منبع: http://www.mondaq.com/Article/1366466