In a bid to help close the gender pay gap and eliminate pay inequities, three states have enacted laws taking effect in 2023 that require greater transparency about compensation.
California, Rhode Island and Washington each have new salary transparency laws on the books as of Jan. 1, 2023. A bevy of other states and cities have their own pay transparency laws in place, including Colorado, Connecticut, Maryland and Nevada — as well as Jersey City, New Jersey; Ithaca, New York City and Westchester County, New York; and Cincinnati and Toledo, Ohio.
Each jurisdiction’s pay transparency law is different, so businesses must review the corresponding law to ensure they’re in compliance. For example, in some locations, employers are required to disclose a position’s minimum and maximum salary only during the recruiting process, while in others, that information must also be provided to existing employees.
States with newly expanded pay transparency laws in 2023
California
California Gov. Gavin Newsom signed Senate Bill 1162 into law on Sept. 27, 2022, expanding its existing pay transparency law (by amending California Government Code Section 12999 and California Labor Code Section 432.3).
Scope. The law applies to employers with 15 or more workers with at least one employee in California.
Requirements. Effective Jan. 1, 2023, applicable employers must:
- List the salary range for all job positions that will or may be filled in California, including jobs that can be performed remotely, on the company’s jobs page or external job sites such as LinkedIn and Glassdoor.
- Provide current employees with the salary range of their position, upon request.
- Comply with expanded pay-data reporting requirements.
Rhode Island
Rhode Island Gov. Daniel J. McKee signed Senate Bill 270 into law on July 6, 2022, expanding the state’s existing Pay Equity Law to incorporate more requirements for employees aimed at preventing wage discrimination.
Scope. Rhode Island employers with one or more employees in the state.
Requirements. Effective Jan. 1, 2023, applicable employers must:
- Disclose the minimum and maximum salary range before discussing compensation with a job candidate.
- Disclose the wage range when officially hiring a new employee.
- Disclose the wage range for current employees moving into a new position.
- Provide a salary range for an existing employee’s position, upon their request.
Washington
Washington Gov. Jay Inslee signed Senate Bill 5761, also known as Washington’s Pay Transparency Law, into law on March 30, 2022. It amends the existing requirement that employers must provide wage information to job applicants only upon their request.
Scope. The law applies to employers with 15 or more employees nationwide, including at least one in Washington, that conduct business there or who are hiring for positions that may be filled remotely by residents of the state.
Requirements. Effective Jan. 1, 2023, applicable employers must:
- Provide the pay range for positions on any digital or printed ad on the company’s hiring board, or listed on a third-party site such as LinkedIn.
- Include benefits the new hire will get, such as health care insurance, retirement benefits, sick leave and more.
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Other jurisdictions with pay transparency laws
Cincinnati and Toledo, Ohio
The Ohio Pay Equity Act requires employers in Cincinnati or Toledo with over 15 employees to provide a salary range to a job candidate upon request, provided that the candidate has been provided an employee offer for the position.
Colorado
Colorado’s Equal Pay for Equal Work Act requires employers with at least one employee based in the state to provide the salary range and general benefits for roles that will be or may be filled in Colorado, including for roles that could be performed remotely from the state.
Connecticut
Connecticut’s pay transparency law, better known as House Bill No. 6380 requires employers with at least one employee in the state to provide job applicants and employees the salary range for a position. This must be furnished when an employee is hired, when an employee changes to a new position, or when an existing employee requests the information.
Ithaca, New York
Employers in Ithaca with at least four employees are required to post the salary ranges for all job postings, including roles for promotion or transfer.
Jersey City, New Jersey
Jersey City’s Pay Transparency Ordinance requires employers with five or more employees and a principle place of business in the city to provide the pay range and a description of benefits in all ads for new employment, transfer positions and promotion opportunities.
Maryland
Maryland’s Equal Pay for Equal Work Law requires Maryland employers to provide the salary range for a position upon request.
Nevada
Applicable to all employers in the state, Nevada’s pay transparency law, Senate Bill 293, requires employers to automatically provide salary ranges to job candidates after an initial interview, even if the applicant doesn’t ask for it. Employers must also provide the salary range for job transfers or promotions once an employee has applied and completed an interview, if they request it.
New York City
Employers with at least four employees and at least one in New York City must list the pay range on any job ad for roles that will be or may be filled in New York City, including positions that can be done remotely from the city.
Westchester County, New York
Under Westchester County’s salary transparency law, any employer that creates postings for positions that will or might be filled in the county, including those that can be performed remotely from there, must include the minimum and maximum compensation range.
Employers should be ready for more
At the time of publication, pay transparency legislation was pending in Massachusetts and North Carolina, and New York Gov. Kathy Hochul approved a statewide salary transparency bill that’s expected to take effect in September 2023. Insiders say that providing salary ranges on job ads will likely soon become the standard everywhere, which suggests that many employers should be prepared to deal with related new compliance duties.
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