NYC Commission on Human Rights Issues Guidance on Salary Transparency Law; NYC Introduces Amendments to the Law
As employers will recall, as of May 15, 2022, New York City employers will be required to include the minimum and maximum salary in job postings. The law as enacted presents several open questions. However, last week, the NYC Commission on Human Rights (the “Commission”) issued a factsheet addressing some of those questions. In addition, as described below, the New York City Council recently proposed a bill that, if enacted, would extend the effective date of the law to November 1, 2022.
The guidance from the Commission most notably addresses (1) what types of compensation must be included in job advertisements, (2) the scope of job advertisements covered by the law, and (3) the location of jobs covered by the law.
Definition of Salary
The guidance defines salary as the base wage or rate of pay, regardless of the frequency of payment (e.g., $15 per hour or $50,000 per year).
Importantly, the guidance clarifies that salary does NOT include other forms of compensation or benefits offered in connection with the advertised position, such as:
Health, life, or other employer-provided insurance
Paid or unpaid time off work, such as paid sick or vacation days, leaves of absence, or sabbaticals
The availability of or contributions towards retirement or savings funds, such as 401(k) plans or employer-funded pension plans
Severance pay
Overtime pay
Other forms of compensation, such as commissions, tips, bonuses, stock, or the value of employer-provided meals or lodging.
Salary Range
The law requires employers to state the minimum and maximum salary they in good faith believe at the time of the posting they are willing to pay for the advertised position.
The guidance defines “good faith” as the salary range the employer honestly believes at the time they are listing the job advertisement that they are willing to pay the successful applicant.
Employers must include both a minimum and maximum salary; the range cannot be open ended (e.g., stating that the job pays “at least $65,000 per year” would not be permissible).
If an employer has no flexibility in the salary they are offering, the minimum and maximum salary may be identical (e.g., $20 per hour).
Advertisements that cover multiple jobs, promotions, or transfers can include salary ranges that are specific to each opportunity.
Scope of Job Advertisements Covered by the Law
The law states that salary ranges must be included in any advertisement for a job, promotion, or transfer opportunity. The guidance defines “advertisement” as a written description of an available job, promotion, or transfer opportunity that is published to a pool of potential applicants.
The law applies to covered job advertisements regardless of the medium in which they are disseminated. Thus, the law applies to postings on internal bulletin boards, internet advertisements, printed flyers distributed at job fairs, and newspaper advertisements.
Due to the expansive definition of “employee” under the NYC Human Rights Law, job advertisements include advertisements to recruit not only full time and part time employees, but also interns, domestic workers, independent contractors, and other categories of worker protected by the NYC Human Rights Law.
The guidance clarifies that the law does not prohibit employers from hiring or promoting without using an advertisement, nor does it require employers to create an advertisement in order to hire or promote.
Geographic Reach
The law does not specify the geographic reach of the law. However, the guidance states that an advertisement is covered if it is for a job that would be performed in New York City, so employers should comply with the law when advertising for a position 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. As noted below, the pending bill may narrow the reach of the law further.
Enforcement
The guidance notes that employers who are found to have violated the NYC Human Rights Law, of which this salary transparency law is a part, may have to pay monetary damages to affected employees and civil penalties of up to $250,000. Employers may also be required to amend advertisements and postings, create or update policies, conduct training, provide notices of rights to employees or applicants, and engage in other forms of affirmative relief if found to have violated the law.
The guidance also encourages individuals to report violations of the law to the Commission.
Proposed Law
Last week, the NYC Council introduced a bill that, if enacted, would amend the law. Some of the proposed changes have already been incorporated into the above guidance, namely the inapplicability to general hiring statements without reference to a particular position and the application of the law to both hourly and salary compensation. However, the proposed amendments would also make a few notable changes:
The law would not go into effect until November 1, 2022.
The law would only apply to employers with at least 15 employees.
The law would not apply to positions that are not required to be performed, at least in part, in New York City.
The bill is currently in committee. We will continue to monitor for any developments.
Employers should continue to prepare to comply with the law. For instance, employers should collect compensation information that will need to be included in active and future job postings, develop a process for including the required information in job postings, and train employees involved in recruiting on the new law. If you have any questions about the new law or need assistance amending your job postings or relating policies, please contact Amanda M. Baker at abaker@fglawllc.com, or any attorney at the firm.
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