Earlier this year, New York State joined a growing number of states and cities that have passed laws mandating salary disclosure when advertising open positions. New York's salary transparency law requires employers to post salary ranges in job advertisements that promote jobs that will be performed, in whole or in part, in New York State, and in advertisements for jobs that report to supervisors located in New York State.
Although this law went into effect on September 17, 2023, the New York State Department of Labor did not publish any proposed regulations until the September 13, 2023, edition of the New York State Register was published. These proposed new regulations attempt to clarify some of the new law's ambiguities, including: (i) what information advertisements for jobs, promotions, or transfer opportunities must include; (ii) how employers must formulate good-faith salary ranges that must be included in job advertisement; (iii) what constitutes a job advertisement; and (iv) how the law will be enforced.
Geographic Scope of the New York State Salary Transparency Law
The regulations reiterate that New York State's salary transparency law applies to all opportunities for jobs to be physically performed, at least in part, in the state of New York. The regulations further reiterate that the law covers advertisements for remote positions and telecommuting roles that report to a supervisor or office in New York. The regulations do not shed any further light on how the New York State Department of Labor will define the term “reports to” and it is not clear if this term is intended to cover only direct supervisors or whether the term is expansive and will cover indirect reports or reports through multiple levels before reaching a manager in New York..
The regulations, however, do clarify that positions in which the employee is expected to visit New York State incidentally or infrequently, such as by attending occasional meetings or conferences within the state, are not performed in part in New York State and therefore the posting requirements will not apply to these positions.
The Law Does Not Apply to Temporary Help Firms
Temporary help firms that hire employees to perform work for other organizations to support or supplement other organizations' workforces, such as by providing coverage for employee absences or during increased seasonal workloads, to supplement skill shortages, or to perform special assignments or projects, are exempt from the law. On the other hand, a temporary help firm must comply with the salary transparency law when it is advertising for positions within the temporary help firm itself.
The law also does not apply to governmental agencies.
What Constitutes a Job Advertisement and What Information Must Be Contained in the Advertisement?
The law extends to all job advertisements regardless of the medium used, including newspapers, flyers, social media, emails to a fixed distribution list, and third-party recruitment tools. In fact, the proposed regulations make clear that employers will be deemed responsible for the compliance of any advertisement published by any third party (such as a recruiter or website or mailing list) that is permitted to publish job advertisements. However, employers are not responsible for job advertisements published by “scrapers,” who are defined as third parties that automatically aggregate electronic job postings and re-post them without the employer's knowledge or consent.
Advertisements must contain a job description for the opportunity if a job description exists. The regulations do not go into detail about how robust the job descriptions must be, but at minimum it must contain a concise description of the primary duties and responsibilities of the job being promoted in the advertisement. A job description may not be required in the limited circumstance where the name of the position or title clearly conveys the full extent of the duties required of the position. The proposed regulation uses the “dishwasher” position, where the dishwasher will only be washing dishes, as an example where a job description will not be required.
The regulations further state that each job advertisement must provide a specific compensation range. Open-ended ranges such as, “$20 per hour and up” or “maximum $50,000 per year” are not compliant. However, the proposed regulations do permit employers to provide a fixed rate of pay (“$15 per hour”), but only if the rate will genuinely be fixed, without room for negotiation. Employers will not be required to disclose other forms of compensation or benefits such as health insurance, paid time off benefits, tip earnings, severance pay, employer retirement contributions, overtime pay, and commission or bonus eligibility. Importantly, a salary range must be for a single opportunity in a single geographic location or region. If an employer uses one advertisement to cover multiple geographic locations or different seniority levels, multiple salary ranges for each individual opportunity must be provided.
If additional space is needed to provide this information to an applicant, the regulations allow employers to use a separate attachment or addendum (like a hyperlink), which must be offered free of charge and easily accessible. The job posting must "clearly and conspicuously state" where the salary range information is available.
The law requires that employers provide a salary range they believe in good faith to be accurate at the time of the advertisement's posting. The regulations define “good faith” as “the range of compensation the employer legitimately believes they are willing to pay the successful applicant or employee at the time they post an advertisement.” Factors such as the job market, current employee compensation levels, hiring budget, and acceptable experience and education levels for the opportunity can be considered when determining the salary range. Employers are also permitted to adjust a salary range based on information gathered during the hiring process. The regulations provide examples of acting in good faith, such as adjusting a salary range and reposting an advertisement in order to attract better-qualified candidates, or offering a higher salary than initially advertised to an overqualified candidate in order to secure the hire. Conversely, a lack of good faith may involve misrepresenting the actual salary compared to what was advertised, or providing an overly broad salary range where the candidate cannot meaningfully determine the actual salary they might be paid.
According to the proposed regulations, any individual who believes they have been aggrieved by a violation of the law may file a complaint, and detailed complaint procedures are available on the Department of Labor's website. Furthermore, the commissioner of labor is empowered to initiate investigations, although there is no private right of action for enforcing this law.
These proposed regulations aim to provide employers with much-needed clarity on the application of Labor Law §194-b. Public comments on these regulations will be accepted until November 12, 2023 and once adopted, will take effect upon the publication of a Notice of Adoption in the State Register. Employers are encouraged to take immediate steps to ensure compliance with this law with the guidance provided within the proposal, and should take additional steps to determine and document compensation ranges using existing data or projecting figures on a good-faith basis.
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