As we discussed in a previous post, effective January 1, 2023, California employers must include pay scales in job postings, and a similar bill in New York was awaiting signature by Governor Kathy Hochul. The California Labor Commissioner has now issued guidance to assist employers in complying with the new law, and the New York State bill was signed into law on December 21, 2022 and is set to take effect on September 17, 2023.

California

The California Labor Commissioner recently published FAQs (adding to existing FAQs under the state’s equal pay law) with insights for employers on some gray areas in the new law:

Threshold for coverage.The FAQs clarify that an employer is covered by the pay transparency requirements if it reaches the threshold of 15 employees at any point in a pay period they compensate their workers at the minimum higher wage rate for the duration of the entire pay period and going forward as long as they have a minimum of 15 employees. Also, all employees, regardless of the number of hours worked or geographical location, will be included in the count, so long as there is at least one employee located in California.

Job postings for remote positions.The Labor Commissioner interprets the new law to mean that the pay scale must be included on a posting if the position may ever be filled in California, whether in-person or remote.

Information to include in job postings.The FAQs confirm that “pay scale” means the salary or hourly wage range that the employer reasonably expects to pay for a position, and can include just a set hourly or piece rate, rather than a range, if that is what the employer intends to pay. If the position’s hourly or salary wage rate will be based on a piece rate or commissions, the piece rate or commission range must be included in the job posting; however, the posting does not need to include bonuses, tips, or other compensation or tangible benefits provided in addition to a salary or hourly wage. Finally, the Labor Commissioner states that the pay scale must be expressly stated in the posting, and it will not be sufficient to comply with the new law to take shortcuts such as linking the salary range in an electronic posting or including a QR code in a paper posting that will then take the applicant to the salary information.

New York

Effective September 17, 2023, the New York Pay Transparency Law (Senate Bill S9427A) (the “NYPTL”) will require employers with four or more employees to disclose the pay range for any posting for a job, promotion, or transfer opportunity that can or will be performed, at least in part, in the State of New York, along with a job description (if one exists). The law does not specify how the employee threshold will be calculated.

“Compensation range” means the minimum and maximum annual salary or hourly range that the employer in good faith believes is accurate at the time of posting. If the compensation is based solely on commissions, employers must state that in the posting. Employers must also maintain records, including the history of pay ranges for each opportunity and any corresponding job descriptions that exist.

The NYPTL prohibits employers from refusing to interview, hire, promote, employ, or otherwise  retaliating against an applicant or current employee for exercising rights under the law. Violations of the NYPTL may result in civil penalties not to exceed $1000 for a first violation, $2000 for a second violation, or $3000 for a third or subsequent violation.

Employers with employees in New York City should also ensure compliance with the similar New York City law, which took effect on November 1, 2022 (addressed in our prior post).

Print:
Email this postTweet this postLike this postShare this post on LinkedIn
Photo of Carolyn Rashby Carolyn Rashby

Carolyn Rashby provides business-focused advice and counsel to companies navigating the constantly evolving and overlapping maze of federal, state, and local employment requirements. Carolyn’s approach is preventive, while recognizing the need to set clients up for the best possible defense should disputes arise.…

Carolyn Rashby provides business-focused advice and counsel to companies navigating the constantly evolving and overlapping maze of federal, state, and local employment requirements. Carolyn’s approach is preventive, while recognizing the need to set clients up for the best possible defense should disputes arise.

As a senior member of Covington’s Institutional Culture and Social Responsibility Practice Group, Carolyn has co-led significant investigations into workplace culture, DEI issues, and reports of sexual misconduct and workplace harassment.

As an employment lawyer with over two decades of experience, Carolyn focuses on a wide range of compliance and regulatory matters for employers, including:

  • Conducting audits regarding employee classification and pay equity
  • Advising on employment issues arising in corporate transactions
  • Strategic counseling on a wide range of issues including discrimination and harassment, wages and hours, worker classification, workplace accommodations and leave management, performance management and termination decisions, workplace violence, employment agreements, trade secrets, restrictive covenants, employee handbooks, and personnel policies
  • Drafting employment contracts and offer letters, separation agreements, NDAs, and other employment agreements
  • Advising on employee privacy matters, including under the California Consumer Privacy Act
  • Providing guidance on use of AI in the workplace and development of related policies
  • Leading anti-harassment and other workplace-related trainings, for employees, executives, and boards

Carolyn also works frequently with the firm’s white collar, privacy, employee benefits and executive compensation, corporate, government contracts, and cybersecurity practice groups to ensure that all potential employment issues are addressed in matters handled by these groups.

Photo of Teresa Lewi Teresa Lewi

Teresa Lewi represents and counsels companies on a wide range of federal, state, and local employment laws. She focuses her practice on trade secrets, non-competition, executive compensation, separation, employee mobility, discrimination, workplace privacy, and wage-and-hour issues.

Teresa represents clients in the life sciences…

Teresa Lewi represents and counsels companies on a wide range of federal, state, and local employment laws. She focuses her practice on trade secrets, non-competition, executive compensation, separation, employee mobility, discrimination, workplace privacy, and wage-and-hour issues.

Teresa represents clients in the life sciences, technology, financial services, sports, and entertainment industries. She has successfully tried cases in federal and state courts, and has resolved numerous disputes through alternative dispute resolution methods. In particular, Teresa has helped companies achieve highly favorable outcomes in high-stakes disputes over the protection of trade secrets and enforcement of agreements with employees. In addition, she defends companies against public accommodation and website accessibility claims under federal and state anti-discrimination laws.

Teresa also conducts specialized internal investigations and assessments designed to help companies protect their confidential information and trade secrets from employee misappropriation and cybersecurity incidents.

Photo of Nori Lu Nori Lu

Nori Lu focuses her practice on counseling clients on employment law compliance and risk mitigation. She advises companies on a broad range of employment-related matters, including personnel policies, employment contracts, workplace investigations, hiring, discipline, termination, and wage and hour compliance. She conducts employment-related…

Nori Lu focuses her practice on counseling clients on employment law compliance and risk mitigation. She advises companies on a broad range of employment-related matters, including personnel policies, employment contracts, workplace investigations, hiring, discipline, termination, and wage and hour compliance. She conducts employment-related diligence and advises on aspects of transactions involving the transfer and retention of personnel. She also has experience litigating claims related to employee restrictive covenants, trade secret misappropriation, wage and hour, discrimination, and retaliation.

Nori was previously a member of the firm’s corporate practice and has experience advising private and public companies in connection with venture capital financings, mergers and acquisitions, corporate governance matters, and commercial transactions.