NYC’s Pay Transparency Law Takes Effect Tuesday November 1st

After a period of delay, New York City’s Pay Transparency Law will take effect on November 1, 2022. The new law, which was previously discussed here, amends the New York City Human Rights Law (“NYCHRL”) to make it an unlawful discriminatory practice for a covered employer to omit from job advertisements the minimum and maximum salary offered for job positions located within New York City.

The new law provides that, in job advertisements, the range of the salary posted cannot be open ended (i.e. “$20 per hour and up” or “maximum $70,000 per year”). Under the new law, “salary” includes the base annual or hourly wage or rate of pay, regardless of the frequency of payment. “Salary” does not include other forms of compensation or benefits offered in connection with the advertised job, promotion, or transfer opportunity, such as employer-provided insurance, paid unpaid time off work, or 401(k) plans. Advertisements that cover multiple jobs, promotions, or transfer opportunities can include salary ranges that are specific to each opportunity. Ultimately, the purpose of the new law is to help reduce pay inequities by providing more transparency.

Any advertisement for a job, promotion, or transfer opportunity that would be performed in New York City is covered by the new law. Because the NYCHRL’s protections extend to many groups of workers, job advertisements are covered regardless of whether they are seeking full- or part-time employees, interns, domestic workers, independent contractors, or any other category of worker protected by the NYCHRL.

The law applies to all employers with at least four employees or one or more domestic workers, provided at least one of those employees works in New York City. While independent contractors must be counted when assessing an employer’s total number of employees, temporary positions advertised by temporary staffing agencies do not count toward an employer’s total employees for purposes of the new law.

All covered employers in New York City should take steps to ensure compliance with these new pay transparency requirements, since noncompliance and resulting violations of the NYCHRL can lead to significant compensatory damages, punitive damages, attorneys’ fees, and civil penalties. By way of example, covered employers may have to pay civil penalties of up to $250,000 for an uncured first violation of the new law, as well as for any subsequent violations.

At a bare minimum, employers should review the salary ranges of current employees in their organizations in order to assess compensation ranges for all positions before publishing job advertisements.

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