Are You Ready for the NY Statewide Wage Transparency Law?
Written by Complete Payroll
It’s official. New York Governor Kathy Hochul signed the new statewide wage transparency bill into law in December 2022, and it takes effect September 17, 2023.
If that seems too far away to worry about, think again. The law's impact is already being felt across the state, and it’s off to a rocky start. Some New York-based companies are skirting the rules and risking legal trouble.
Now’s the time to plan for the effects of the new law on your business. Here’s what you need to know.
What is the New Statewide Wage Transparency Law?
New York Assembly Bill S.9427-A/A.10477, more commonly known as the wage transparency bill, is designed to give applicants better information before applying for jobs or transferring within their companies. It also promotes wage equality through transparency, shining a light on the fact that women and minorities tend to earn lower wages than others.
Under the new law, all New York state employers with 4 or more employees may not advertise any job, promotion, or transfer opportunity without stating:
- The job description for the job, promotion, or transfer opportunity, if one exists.
- The compensation or salary range for the job, promotion, or transfer opportunity.
In listing the salary, employers are not required to list health insurance, life insurance, paid/unpaid time off work, vacation days, leaves of absence, sabbaticals, 401(k) plans, contributions to retirement/savings, pension plans, severance pay, overtime pay, bonuses, stocks, or employer-provided meals/lodging.
With this new law, New York now joins California and Washington in addressing employment-related transparency issues. Although this law had fairly widespread support, you may recall that New York has also seen other recent employment law controversies that could impact your business, like the New York minimum wage and the recently-enacted NY long-term care payroll tax.
Does the Wage Transparency Law Apply to Remote Workers and Commission-Based Employees?
You’re probably wondering whether your remote/work-from-home employees are covered under the new wage transparency law. To answer this question, consider your location, not their location. As long as just one of your employees works in New York or you’re seeking employees who would be based in New York, the law applies to you.
To clarify, this means at a small New York company with just four employees, all four don’t need to work in the same location or be located in New York. If you have one employee in New York, or if your company would potentially hire someone in New York, you should comply with the new law to stay in the clear.
In terms of advertising pay based on commission, make sure you disclose it in your employment ads. An employer advertising a commission-based job could include a general statement like, “Compensation for this position shall be based on commission,” with a broad range of minimum and maximum annual pay.
How Can I Prepare My Company for the New Law?
Get ahead of the wage transparency law by reviewing all of your employment advertisements, including the job listings you share online and on social media. According to the state of New York’s Salary Transparency Fact Sheet, “advertisements are covered regardless of the medium in which they are disseminated.”
Ensure every job listing includes the compensation or a pay range, plus a job description if one is available. Employers must make a “good faith” effort to include as much relevant and up-to-date information as available about compensation and job duties.
Keep in mind that the new law also requires employers to maintain detailed and accurate records regarding pay rates, job descriptions, and other factors related to pay transparency. Failure to comply with the law puts you at risk of receiving a violation warning or even paying a civil penalty of up to $250,000 per incident.
Of course, always consult with an employment lawyer before making any legal decision for your business. Complete Payroll offers the information above solely for informational purposes and does not provide legal advice.
Need More Help With Wage and Payroll Information?
If you’re looking for more guidance about changes that could impact your business, Complete Payroll has you covered. Visit our blog for more articles like these to guide you through the ins and outs of everything related to HR and payroll.