Implementation of the New York State Salary Range Act – Employee Benefits and Compensation

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On December 21, 2022, Governor Hochul signed legislation establishing a statewide pay transparency law in New York, effective September 17, 2023, requiring employers to disclose salary or hourly wage ranges for all advertised positions and promotions. The legislation is codified as part of the New York Labor Code at Section 194-b. This follows the implementation of a pay transparency law in New York City on November 1, 2022. For more information on the New York City pay transparency law, see Kane Kessler’s legal notice on the subject at https://www.kanekessler.com/firm-publications/new-york-city-to-require-salary-ranges-in-job-postings/.

In accordance with statewide law, every employer with four (4) or more employees, as well as employment agencies (excluding temporary employment agencies), must state in every job advertisement, promotion, or transfer opportunity the minimum and maximum annual salary or hourly compensation range that the employer has a good faith belief at the time of the assignment considers correct. In addition, employers must provide the job description for each such position, promotion, or transfer opportunity, if such a description exists. The law also prohibits employers from retaliating against applicants or workers for exercising their rights under this section. Finally, the law requires employers to maintain and maintain records, including but not limited to, the history of compensation ranges for each position, promotion or transfer opportunity and the job descriptions for such positions, if such descriptions exist.

Failure to comply with the law can subject employers to civil penalties of up to $1,000 for a first violation, $2,000 for a second violation, and $3,000 for a third or subsequent violation. The amount of the penalty depends on the size of the employer, their good faith, the seriousness of the violation, and whether the employer has previously broken the law. While the law does not provide for a private right of action, any injured person may file a complaint with the New York State Department of Labor.

New York City’s Pay Transparency Act went into effect on November 1, 2022, and other places within the state have passed similar laws. New York State law does not supersede or supersede any local law, rule or regulation, but acts as a supplement to cover areas of the State without such local laws. While statewide requirements are largely consistent with those in local New York jurisdictions, employers should be aware of new obligations under state law. The law directs the New York City Department of Labor to conduct an outreach campaign, so more guidance is likely to be forthcoming.

Before the law comes into force, employers can take practical steps to proactively prepare to comply with the law: 1) conduct an equal pay assessment and make adjustments as necessary; 2) Evaluation of the guidelines for determining salaries and allowances; 3) Review and revise current job postings to ensure each description accurately reflects salary range and work performed; 4) Developing a process to consistently publish the salary range for all assignments; 5) Review of job application and interview transcripts (reminder: New York State’s salary development ban prohibits employers from asking about applicants’ current or past earnings); and 6) Conducting surveys of competitor job openings to determine whether compensation is competitive for similarly ranked employees.

The content of this article is intended to provide a general guide to the topic. In relation to your specific circumstances, you should seek advice from a specialist.

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