- New York is next. New York is the latest state to require salary ranges to be provided on job postings beginning Sept. 17.
- Be prepared. Employers of all sizes should be developing a comprehensive plan on how compensation changes are communicated throughout the organization.
- Cohesive communication is key. Build trust by clearly explaining what employees are paid, that they are paid equitably and that they have a fair shot at advancing.
On the heels of New York City’s relatively recent pay transparency law, the state of New York has followed suit with a pay transparency law of its own.
And while New York state’s law, which goes into effect Sept. 17, somewhat mirrors New York City’s law, the state law provides additional requirements.
For example, the state law covers remote workers. It also requires covered employers to include job descriptions in writing and maintain compensation history ranges and job descriptions.
Nationwide, New York state’s law is part of an ongoing trend of transparency laws gaining momentum. In fact, more than 1 in 4 workers in the U.S. labor force are now covered by state pay range transparency laws, based on data from the National Women’s Law Center.
National Approach
Employers and HR leaders should be developing a comprehensive plan that addresses not just the New York State pay transparency law, but also how compensation is communicated throughout the organization.
Megan Nail, vice president, total rewards practice at NFP, a national benefits consultant and property and casualty broker, said that at the top of the list of her firm’s recommendation for New York employers is to:
- Review open positions, whether they are new positions or open for promotions and transfers. Also, ensure job descriptions are updated, the pay range is accurate and everything can be posted and disclosed in your applicant tracking system or other method of job advertising.
- Educate all managers on foundational areas such as why a job description is important, how pay ranges are determined at the organization, the organization’s compensation philosophy and how employees and candidates are placed within the pay range.
- Create a strategic plan to work toward pay range transparency for all jobs across the organization if this is not already in place, as it is like that employees will ask questions about their own range and compensation potential as ranges become transparent for open positions.
- Develop a comprehensive communication and education plan for all employees on those same topics — that goes beyond this single point in time but will build throughout the year and continue to evolve.
“Employers also need to develop a national and holistic strategy to communicate pay, which is not only compliant in the states in which they do business, but also shares the information internally with their leaders and employees,” she said. “We expect the trend of pay transparency to continue and now is the time to prepare.”
Prepare for Employee Inquiries
Communication is also a key strategy, according to Nail. “It needs to start with managers and leaders, and then move to employees, so managers are equipped to answer any questions," she said.
Christine Hendrickson, vice president of strategic initiatives at Syndio, said the transparency journey begins with taking control of data so the organization has the insights needed to build a strategy for implementing pay transparency, and then thoughtfully communicating about it with employees.
“When you can clearly explain why you pay employees what you pay, that they are paid equitably, and that they have a fair shot at advancing, you build trust,” she said. “The element of pay explainability is crucial.”
Syndio CEO Maria Colacurcio said the question isn’t about whether or not to be transparent, but rather how far to go. She said that whether you’re in a state that has a pay transparency law or not, once you start sharing information about salary ranges, pay equity, representation and pay gaps, then all your employees, your board and your investors will continue to expect it.
“In this regard, adopting a national strategy will pay for itself in spades down the road,” Colacurcio said. “Last year, we saw wave-after-wave of pay scale transparency laws passed in the United States.”
This year, she added, the pace has slowed, with Hawaii being the first jurisdiction to adopt a pay transparency law in the U.S. and Illinois following.
“They are unlikely to be the last, as there are several jurisdictions considering similar legislation. Our eyes are on Massachusetts, Washington D.C. and New Jersey,” Colacurcio said.
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