Salary Transparency Takes Effect in NYC: FAQs

October 31, 2022

New York City’s pay transparency law will become effective tomorrow, November 1, 2022. To comply with this new law, covered employers will be required to include a salary or hourly rate range in their job advertisements.

Given the important changes this law will require in the hiring process, here are some helpful FAQs:

Who is affected?

All employers with four or more employees, or one or more domestic workers, must comply with the pay transparency law when advertising a position that can or will be performed in NYC.

Like other provisions of the New York City Human Rights Law, employers and owners will be included in the count towards four employees. In addition, the workplace will be covered by the law regardless of whether all four employees work at the same location. If just one employee works in any of NYC’s five boroughs, the employer will be subject to the law.

What job postings are covered?

Employers must include a salary or wage range in postings for job, transfer, and promotion opportunities. According to the NYC Commission on Human Rights, this applies to all positions that will be or can be performed, whether that be in whole or in part, in NYC. This is not limited to office jobs, but rather will apply also to field-work and remote-work performed in NYC.

In addition, these requirements apply equally to all advertisements whether posted on the internet, printed in a flyer or newspaper, or shared on an internal forum.

What is the “good faith” pay range that is required?

An employer must provide the pay range for the advertised job opportunity, including both the minimum and maximum yearly salary or hourly wage, for which they believe, in good faith, they are willing to pay for the position at the time of posting. It will not suffice to include only the minimum pay or the pay cap.

Can “salary” include other forms of compensation?

No. Although employers can include information about benefits or other forms of compensation (e.g., stock options) in job advertisements, these benefits cannot be factored into the pay range calculation.

Does the NYC law include disclosure obligations to current employees, similar to laws in other jurisdictions?

No. Some jurisdictions, such as California, have enacted legislation that requires employers to provide all employees with a pay scale for their current position. The NYC pay transparency law does not include such obligations. However, employers need to keep in mind that their advertisements, and thus their pay ranges, will be publicly available for anyone, including their current employees, to view.

How will this law be enforced?

NYC’s pay transparency law will be enforced, and investigations conducted, by the Commission on Human Rights. First time violators will receive a notice of violation and have 30 days to cure the violation. If the issue is not fixed, the employer may be hit with civil penalties of up to $250,000 for the first violation, as well as for any subsequent violations.

If you have any questions about the new obligations under this law, please reach out to us.

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