DISCLOSING WAGE RANGES – EXPANSION OF PAY EQUITY LAWS

As noted in a previous article about equitable pay laws, many states prohibit employer’s inquiries about previous pay rates in job applications since relying on previous salary to set pay for any employee could perpetuate the wage gap among equally qualified employees and may result in a challenge of pay disparity. Now several states have gone a step further by requiring the disclosure of pay ranges to applicants at various stages of the hiring process. Read more to learn about the nuances of these state laws and how to manage these requirements.

State Laws Governing Wage Disclosures

As of October 1, Connecticut employers will be required to disclose wage ranges for open positions. Among other requirements, this amendment to Connecticut’s equal pay law requires that applicants are provided with this information before or at the time of an offer or upon an applicant’s request, whichever occurs sooner. Several other states, including California, Maryland, and Washington, also have wage disclosure obligations for employers, but their obligations are only triggered by the applicant’s request for this information.

Colorado’s Equal Pay for Equal Work Act is more extensive and requires any employer with at least one employee in the state of Colorado to disclose the specific salary and benefits information for any open position in Colorado, including remote jobs since those could be performed in that state. Colorado also requires that these disclosures must be contained within the job posting itself.

Considerations for Employers

Since many states prohibit inquiries about previous pay history in the application or screening process, review your hiring processes carefully and remove pay-related questions in states where these are prohibited to ensure compliance. Consider removing such questions for all locations as a good business practice. Cadient Talent assists our clients in maintaining compliance by easily accommodating changes to client-specific applications, while standard pay-related questions were removed from the baseline Candidate Experience several years ago.

Conduct an internal pay analysis and create a detailed pay structure system to document pay differences among your workforce based on justifiable factors such as job-related experience and training, merit system, seniority, and measurable earnings based on production quantity or quality.

Establishing Fair and Inclusive Salary Ranges

Base your salary offers on job-specific experience and an objective assessment of the position requirements, and ensure they are compliant with local legislation and any existing collective bargaining requirements. Make an offer within the specified salary range and independent of the worker’s age, gender, ethnicity, or other identity markers to level the playing field and promote equal pay for work of equal value.

For more information about equal pay and compensation discrimination, refer to the EEOC’s facts on this topic or the U.S. Department of Labor, and consult with your legal team. Details and statistics regarding states’ equal pay protection laws can be found on the nonpartisan National Conference of State Legislatures website.