A Look Through New York City’s Upcoming Wage Transparency Law

WHAT IS THE WAGE TRANSPARENCY LAW?

The Wage Transparency Law makes it an “unlawful discriminatory practice” for an employer or employment agency to advertise a job, promotion or transfer opportunity without stating the minimum and maximum hourly wage or salary compensation in the advertisement. The law permits employers to list the “good faith” range, which means the employer may ultimately choose to pay an amount outside of this range.

WHICH EMPLOYERS ARE COVERED?

The Wage Transparency Law applies to all New York City employers with at least four employees, if at least one employee is located within New York City.

WHICH POSITIONS ARE COVERED?

Any advertisement for a job, promotion or transfer opportunity that would be performed, in whole or in part, within the five boroughs of New York City is covered by the Wage Transparency Law. This includes both in-person work at a New York City commercial address, and remote work from a New York City residential address. This is true regardless of the medium by which the advertisement is disseminated, and thus the Wage Transparency Law applies equally to postings on internal bulletin boards or intranet listings, emails, internet advertisements, printed flyers distributed at job fairs and newspaper advertisements.

Jobs that can be performed remotely from anywhere, including but not limited to New York City, are theoretically covered by the Wage Transparency Law. It is unlikely, however, that the New York City Commission on Human Rights (Commission) would seek out violations with little nexus to New York—for example, if the employer is based outside of New York City, with only one employee located in New York City, and is posting for a position that could be performed from anywhere in the world. On the other hand, if the employer has a New York City office and the employee may occasionally be asked to come into the workplace, this posting could be covered.

Employers can still choose to hire or transfer employees without using a written job advertisement. This caveat may be particularly relevant for employers who use executive search firms, rather than traditional written job advertisements, to fill senior-level positions.

WHAT MUST BE INCLUDED IN THE POSTING?

Employers are required to state the good-faith minimum and maximum base compensation for each posted job. “Good faith” means a salary range that an employer honestly believes that the employer is willing to pay at the time the job advertisement is posted. “Salary” includes the base annual or hourly wage that will be paid to a successful applicant. Salary does not include any other forms of compensation or benefits, such as:

• Employer-sponsored insurance benefits
• PTO, vacation or sick time
• Retirement funds, such as 401(k)
• Severance opportunities
• Overtime opportunities
• Commissions, bonuses, stock or value of other employer-provided benefits, like meals, cell phone reimbursements, etc.

Employers may choose to include any or all of the benefits information listed above within their job postings, but they are not required to do so.

WHAT ARE THE PENALTIES FOR FAILING TO COMPLY?

The Commission is tasked with enforcing the Wage Transparency Law. The statutory civil penalty for an employer’s first violation of the Wage Transparency Law is $0, provided that an employer can show that it has cured a violation within 30 days of service of the complaint. Civil penalties for uncured or subsequent violations, however, may be as high as $250,000.

In addition, employees may either file a complaint with the Commission or bring a lawsuit against their current employers for violations of the Wage Transparency Law. Notably, the law, as newly amended for the November 1, 2022, effective date, no longer affords a private right of action to outside job applicants.

ANYTHING ELSE?

As of November 6, 2022, Westchester County, home to some of the closest suburbs to New York City, will impose its own pay transparency law, requiring employers to disclose the good-faith wage ranges for positions that are required to be performed, in whole or in part, within Westchester County. This means that New York City employers advertising a hybrid remote-and-in-person role could find themselves subject to both New York City’s and Westchester County’s laws.

WHAT’S NEXT?

On November 1, 2022, New York City will join the growing number of state and municipal jurisdictions that have already implemented wage transparency laws. Employers should take care to ensure that their job postings comply with the Wage Transparency Law’s requirements by the end of the month.