A month ago, I was excited to learn that New York City was implementing a pay transparency law on November 1, 2022. The new law requires, among other things, that employers include pay rages in their job postings.
Pay transparency and related pay equity laws are not new. California implemented one of the first laws in 2018. And, as we noted last week, Massachusetts started implementing equal pay laws in 1945.
Most of the laws, unlike New York’s law, don’t require employers to list salary ranges in their job announcements. Nonetheless, they do offer some degree of transparency by allowing job candidates to ask for and receive salary range information. Often, the new laws limit the ways employers can consider jobseekers’ previous salaries when evaluating their job applications.
This week, we are covering the western and Midwestern states with transparency laws—California, Colorado, Nevada, Ohio, Oregon, and Washington. Only the Washington law requires employers to include salary ranges in job announcements now. The California law will add this requirement next year.
A statewide law in California, (Labor Code Section 432.3, and Senate Bill 1162) was the first U.S. law requiring that employers provide the pay range for a job if the applicant asked for it after the first interview. Effective January 1, 2018, this law prohibited employers (with limited exceptions) from requesting salary information from applicants. It also required employers to supply pay scales upon request from an applicant.
With Senate Bill 1162, effective January 1, 2023, employers with 15 or more workers must include the pay scale for a position in the job posting (including third-party job postings). Employers, upon request from an employee, must also provide the pay scale for the employee’s current position. Employers are also required to maintain records of job titles and wage rate history for employees for the duration of their employment plus three years.
Employers are prohibited from seeking salary history information (including compensation and benefits) or using the applicant’s salary history information to determine whether to offer employment or what salary to offer an applicant. However, candidates can voluntarily provide salary history information (and, when disclosed in this manner, the information can be considered or relied upon in determining the salary offered the applicant).
Additionally, two California cities, San Diego and San Francisco, have put their own pay equity-related laws on the books.
San Diego, CA: San Diego’s Equal Pay Ordinance (Article 2, Division 48),effective January 1, 2018, requires employers who contract with the City of San Diego to pay employees equal wage rates for equal or substantially similar work, regardless of an employee’s gender, race, or ethnicity.
San Francisco, CA:San Francisco’s law (Article 33J: Parity in Pay), the “Parity in Pay Ordinance,” effective July 1, 2018, prohibits both private and public employers from asking job applicants to disclose their salary history. However, if the applicant voluntarily discloses the information (without prompting), employers may consider the information in determining starting pay for the applicant.
Enacted in 2019, the “Equal Pay for Equal Work Act” (SB19-085) prohibits employers from seeking the wage rate history of a prospective employee or requiring disclosure of wage rate as a condition of employment. It also prohibits companies from relying on a prior wage rate to determine a wage rate to offer an applicant. Employees cannot be discharged, disciplined, discriminated against, or otherwise interfered with for inquiring about, disclosing, or discussing the employee’s wages. In addition, employers are required to announce to all employees “employment advancement opportunities and job openings and the pay range for the openings.”
According to the Nevada law (Senate Bill 293), effective October 1, 2021, any public or private employer in Nevada must disclose a wage or salary range to applicants after an initial interview. Current employees applying for a promotion or transfer (or who complete an interview for a promotion or transfer, have been offered a promotion or transfer, or request information to consider a promotion or transfer) must be provided a wage or salary range.
In addition, employers are prohibited from inquiring about an applicant’s salary history, or discriminating against an applicant who refuses to provide their salary history. Both public and private employers are allowed to ask candidates for their “salary expectations” for the position, and if this information is volunteered, it can be used to make salary offers.
Cincinnati, Ohio and Toledo, Ohio have ordinances barring use of salary history in hiring.
Cincinnati, OH: The “Prohibited Salary History Inquiry and Use” (Ordinance 83-2019), effective March 2020, states employers with 15 or more employees in the city of Cincinnati are barred from inquiring about or relying on job applicants’ salary histories. Employers cannot inquire about the salary history of an applicant, screen applicants based on current or previous salary history, or use the salary history of an applicant to decide whether to extend a job offer or in determining salary and other compensation. Applicants cannot be retaliated against for not disclosing salary history.
Employers are allowed to ask applicants about their salary expectations. In addition, employers must provide a pay scale for the position, upon request, after the employer extends a conditional offer of employment.
Toledo, OH: the pay equity ordinance in Toledo is known as the “Pay Equity Act to Prohibit the Inquiry and Use of Salary History in Hiring Practices in the City of Toledo” (Ordinance 173-19).
Effective June 2020, employers with 15 or more employees must provide, upon request, an applicable pay scale to job applicants who have received conditional offers of employment.
Employers are prohibited from inquiring about or using an applicant’s salary history in deciding whether to extend a job offer or in determining salary or other compensation. Employers cannot refuse to hire an applicant or retaliate against an applicant for not disclosing salary history. The law does not apply to current employees seeking internal positions.
“The Oregon Equal Pay Act of 2017” (House Bill 2005 )
was signed into law in June 2017. Employers with one or more employees performing work in the state of Oregon are subject to the law.
Effective October 2017, employers were no longer allowed to ask candidates about their salary history. Employers cannot ask for a worker’s salary or pay history before they make an offer of employment, although they can ask an applicant’s “preferred salary.” In addition, employers cannot screen job applicants based on current or past salary or pay history. Employers also cannot determine compensation for a job based on the current or past compensation of an applicant.
In January 2019, additional provisions came into place affecting pay disparities, requiring employers to pay every worker “equal pay for equal work regardless of gender, race, age, or other protected characteristics.”
Also, employees asked about their salary history or alleging pay equity discrimination are allowed to pursue a private right of action. And, employers are prohibited from determining compensation based on a candidate’s salary history, even if a candidate voluntarily revealed their salary history. Effective in October 2022, employers are no longer allowed to omit hiring and retention bonuses from consideration in an equal pay analysis.
The pay equity law in the state of Washington is known as “The Washington Equal Pay and Opportunities Act” (Chapter 49.58 RCW). Starting January 1, 2023, employers with 15 or more employees must provide a wage scale or salary range for each job posting (not just a minimum salary or wage). The job posting must include a description of all benefits and compensation offered (not just wage or salary). For internal roles, employers are required to provide a salary range or wage scale upon request (and all positions must have a wage scale or salary range).
The law also prohibits employers from limiting an employee’s ability to discuss wages and prevents nondisclosure of wages as a condition of employment.
Remember, this post, along with the preceding two posts on pay equity and transparency laws and ordinances around the United States are only brief summaries of complicated legislation. They are not legal advice. Please consult an attorney with specific questions regarding your own situation.