Pay Transparency In NYC Delayed

Mere weeks before the New York City pay transparency law was to become effective, the New York City Council has passed an amendment that delays requiring that employers disclose pay ranges for posted positions until November 1, 2022. If signed by Mayor Eric Adams, the amendment clarifies the law’s scope and provides reprieve to impacted employers rushing to comply.

The Pay Transparency Law As Passed

In January 2022, the New York City Council passed Int. 1208-2018, which amends the New York City Human Rights Law and requires employers with four or more workers in New York City to post the minimum and maximum pay range for any job within the city by May 15, 2022.

Guidance published by the New York City Commission on Human Rights (NYCCHR) provided clarification concerning the scope of the law and its applicability to remote workers. The NYCCHR’s fact sheet notes that an employer is a qualified employer under the law if any of its workers work in the city. The pay transparency law applies to employers in New York City with at least four employees. All four employees do not need to work in the city; a single worker within the city will subject the employer to the scope of the law.

Concerning remote workers, the NYCCHR issued the following statement, “Covered employers should follow the new law when advertising for positions that can or will be performed, in whole or in part, in New York City, whether from an office, in the field, or remotely from the employee’s home.” The guidance suggests that any work that can be conducted within New York City, even if performed remotely, is subject to the pay transparency law.

Public and Private Challenges

Almost immediately after being passed, New York City’s pay transparency law was met with backlash from government officials and private employers.

A letter to New York City Council, drafted by the five borough chambers of commerce and the Partnership for New York City, argues that corporate employers seeking to diversify their executive teams may offer higher compensation for candidates who are Black, Indigenous, or people of color. “In the context of achieving diversity goals, the posted maximum [for these positions] may be significantly higher than the historical pay ranges, creating dissatisfaction in the workforce and demands to adjust existing pay scales that the employer may be unable to afford.” The letter noted that workers of color are at a ‘tremendous premium’ in a tight market. In effect, the letter asserts that pay transparency harms the groups it intends to protect, at least at the executive level.

While the city’s pay transparency law intends to promote pay equity by arming candidates with valuable data that can be used in compensation negotiations and help to expose long-lasting pay disparities, opponents to the law argued that it was overly broad, impacted diversity efforts, and didn’t provide employers with enough time in which to comply. To the dismay of pay equity advocates, amendments to the pay transparency law were proposed and passed to help alleviate the concerns raised by employers and city officials.

The Amended Law

On April 28, 2022, the New York City Council passed Int. 134, which is representative of compromise between proponents and opponents of the city’s pay transparency law.

The law as amended:

• Requires that impacted employers comply by November 1, 2022.
• Maintains that all employers with four or more employees are subject to the pay transparency law.
• Adds coverage for hourly-paid workers in the pay transparency law by requiring that the “minimum and maximum annual salary or hourly wage” for the advertised position be posted.
• Concerning remote workers, the pay disclosure requirement does not apply to positions that cannot or will not be performed, at least in part, in New York City. However, if a position could be filled by a candidate who resides in New York City, then an advertised position for remote work must disclose a pay range.
• Creates a limited private right of action that employees can bring against current employers.
• Provides no penalty for a first violation if the violation is cured within 30 days of complaint service.

Looking Ahead

New York City’s pay transparency law is further proof that the #shareyoursalary movement continues to gain traction. Employers in New York City, including those that make remote jobs available to candidates within the city, should take affirmative steps to comply by this fall. Employers are encouraged to review pay equity resources, conduct internal compensation audits, correct pay disparities, and prepare to disclose pay ranges. Employers can expect further guidance from the NYCCHR in advance of the pay transparency law’s effective date.