It has been more than a year since New York City's pay transparency law, codified at Section 8-107(32) of the Administrative Code of the New York City Human Rights Law (NYCHRL), went into effect, and we are now starting to see how the law will be enforced by the New York City Commission on Human Rights (NYCCHR or the Commission). Recent activity by the Commission provides New York City-based employers a much-anticipated first look into what enforcement will look like and sends a strong signal that the Commission is paying attention to compliance.
As we previously reported here and here, Section 8-107(32) requires covered employment agencies and employers that post a job, promotion or transfer opportunity for a position that can or will be performed in New York City to include in the posting a good faith salary range for the position.
A review of the Commission's inaugural round of initiated complaints published by the NYCCHR provides useful insight for employers that continue to grapple with what constitutes adequate compliance with the law. The most significant takeaway from our review of the complaints is that the Commission is actively seeking to ensure compliance with the law and will not be deflected by partial compliance—based on the Commission-initiated complaints, the Commission is prepared to pursue complaints due to a single noncompliant job posting. And while first-time violators avoid civil penalties by submitting proof of cure to the Commission within 30 days of receiving notice of an alleged violation, doing so is an admission of liability, such that any subsequent violation could result in a civil penalty of up to $250,000.
The NYCCHR website publishes recent Commission-initiated complaints of alleged unlawful discriminatory practices in violation of any provision of the NYCHRL. As of Jan. 24, 2024, the webpage lists 33 complaints, half of which remain open and all but one of which concern alleged violations of Section 8-107(32). No specific industry appears to have been targeted given the breadth of companies encompassed by the Commission-initiated complaints, ranging from fashion brands and consulting firms to HVAC businesses.
As discussed above, Section 8-107(32) requires employers to include a good faith salary range for every job posting. The large majority of the Commission-initiated complaints were based on the employer's failure to include any salary range whatsoever in the job posting. Importantly, some of the companies cited were acknowledged to be compliant with respect to the vast majority of their postings but nonetheless cited for those that were noncompliant. Thus, for example, one employer was cited for two postings that failed to include salary ranges out of the 64 listings posted as of Aug. 9; a separate complaint focused on another employer's one noncompliant posting out of 42 examined.
A much smaller group of employers was deemed to be in violation of the law for posting salary ranges that the Commission found were not made in good faith. Currently, three complaints remain open against employers for posting salary ranges that the Commission determined were not reported in good faith. In two instances, the employer posted broad pay ranges where the maximum wage was as much as three or four times higher than the low end of the range. For example, one employer displayed the following ranges for its respective job openings: $50,000 – $180,000; $31,000 – $125,000; $40,000 – $160,000; and $50,000 – $145,000. Another employer posted the following wage scales: $18.00 – $48.00/hour; $72,000 – $210,000; and $22.00 – $58.00/hour. In the third complaint, the Commission found that a salary range of $150,000 to $225,000 was not determined in good faith, but it did not provide any analysis or reasoning for that determination. It remains to be seen how this concept of "good faith" will develop under the pay transparency jurisprudence.
The last group to come under the Commission's scrutiny were employment agencies, defined by NYCHRL Section 8-102 as including any person undertaking to procure employees or opportunities to work. National employment agencies such as Indeed Inc., CareerBuilder LLC, ZipRecruiter Inc., and Monster Worldwide Inc. were all subjects of Commission-initiated complaints. The Commission found that these employment agencies violated both requirements of Section 8-107(32) by (1) posting job listings that lacked ranges altogether and (2) posting other job listings that included ranges the Commission determined were not reported in good faith. Additionally, with the exception of Monster Worldwide, while the Commission recognized that these websites provide estimated ranges based on similar jobs and user-generated data in the absence of employer-provided salary ranges, it found the provision of this information insufficient to comply with the requirements of Section 8-107(32) because it was not provided by the proposed employer.
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The Commission's enforcement activity signals to New York City employers that it will demand strict compliance with the requirements of Section 8-107(32). No exceptions will be made for employers that largely comply with the posting requirements if one of those postings is deemed insufficient. Further, these complaints demonstrate that the Commission will scrutinize salary ranges in postings to ensure they are provided in good faith. Please contact a member of Kramer Levin's Employment Law department with any questions or concerns about the topics raised in this alert.
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