New York State Enacts Wage Transparency Laws: September 2023 Effective Date

The intent and purpose of the new law is to foster wage transparency in the employer-employee relationship in New York. The law will go into effect September 17, 2023.

Who are “Covered Employers?”

Covered employers include: (1) Any person, corporation, limited liability company, association, labor organization or entity employing four or more employees in any occupation, industry, trade, business or service, or any agent thereof; and (2) any person, corporation, limited liability company, association or entity acting as an employment agent or recruiter, or otherwise connecting applicants with employers.

What are the Obligations of Covered Employers?

Employers and employment agencies and their staff cannot advertise a job promotion or transfer opportunity without disclosing the following in writing: (1) The compensation or a range of compensation for such job, promotion, or transfer opportunity; and (2) the job description for such job, promotion, or transfer opportunity, if such description exists.

The new law defines “range of compensation” to mean the minimum and maximum annual salary or hourly range of compensation for a job, promotion, or transfer opportunity that the employer in good faith believes to be accurate at the time of the posting of an advertisement for such opportunity.  If there is no range but a fixed salary or minimum, the posting must note that as the set rate/salary offered.

The law initially did not define “advertise,” but on March 3, 2023 the law was amended to define “advertise” to mean to make available to a pool of potential applicants for internal or public viewing, including electronically, a written description of an employment opportunity.

There are circumstances in which an employer may hire or promote an individual at a greater or lesser compensation/range but those exceptions must be based on demonstrated job-related reasons.  For instance, there is a “Super Star” applicant whose qualifications/experience exceed the minimum requirements, or there were no applicants that meet the minimum requirement.  As with any job action, it cannot be based on a protected category.  For purposes of the obligation under the law, employers should know what the expected range will be for the employment opportunity without considering these exceptions.  As such, compliance will require knowledge of employees’ current salary or wage rate and planning for future growth.

What are Ramifications for Noncompliance?

An employer who fails to comply with any requirement of the new law, or any regulation published thereunder, will be subject to a civil penalty in accordance with New York State Labor Law §218. The civil penalty is $1000 for the first violation and increases with additional violations.  In addition, the law indicates that it cannot be construed or interpreted to supersede or preempt any provisions of local law, rules, or regulations. Currently in New York State there are local laws in New York City, Albany and Ithaca, although the trend is for increasing regulation in this area. Therefore, covered employers must comply with the local laws applicable to their operations as well.

More to Come

The new law requires the NYS Department of Labor to: (1) Promulgate rules and regulations to effectuate the new law; and (2) conduct a public awareness outreach campaign, which shall include making information available on its website and otherwise informing employers of the new law.

If you have any questions about Barclay Damon LLP or its service offerings, please contact Margaret Surowka, partner in Health Care and Labor & Employment, at msurowka@barclaydamon.com; Fran Ciardullo, special counsel, at fciardullo@barclaydamon.com;Bridget Steele, counsel, at bsteele@barclaydamon.com; or another member of Barclay Damon’s Health & Human Services Providers Team or its Labor & Employment Practice Area.