Beginning Tuesday, companies hiring NYC workers will be required to list the minimum and maximum salary range for a job in every printed or online position.
Advocates say it’s long overdue for companies to be more transparent about their pay practices. Workers hope it gives them more leverage to discuss and negotiate their wages. And the main goal of the law is to close the wage gap.
But as the numbers broke this week, New Yorkers began yelling at some companies for releasing extremely wide ranges: $50,000 to $145,000 for a reporter opening, $125,800 to $211,300 for a senior technical writer, $106,000 to $241,000 for a position as General Counsel.
In one case, Citigroup listed multiple jobs ranging from $0 million to $2 million, Gothamist reports.
A Citigroup representative told Gothamist that it has since updated its ranges and that the shockingly large range was a bug caused by a computer bug.
Still, a revised entry for a job for a customer service representative listed the pay range as $61,710 to $155,290 Wednesday before it was removed. A Citi representative told CNBC Make It that the company “proactively reviews all job postings to ensure the correct salary range is listed” and “has temporarily not posted select job postings and will repost when the salary range is confirmed.”
The posting faux pas illustrates the numerous ways in which companies can still circumvent the new salary transparency law – intentionally or unintentionally.
Employers test what it means to list an assortment in good faith
The law specifically states that companies hiring in New York City must publish a “good faith salary range” for each position, promotion, or transfer opportunity.
A “good faith” area is an area in which the employer “has a good faith belief, at the time of posting the job posting, that it is willing to pay the successful candidate(s)” says the New York Human Rights Commission, which enforces the law.
Companies may need to offer diversity if they want to accommodate people with different levels of experience and compete in a tight hiring market, says Domenique Camacho Moran, a New York-based attorney with Farrell Fritz.
A common strategy for companies is to find a target budget for a job opening and specify a range of 20% below and above that point, adds Tony Guadagni, senior principal of research at consultancy Gartner.
But a range of over $100,000 could be a mistake or an indication that “an organization’s willingness to pay for a job can vary widely,” says Guadagni.
“It’s hard to imagine that the two agencies investigating possible violations of the new law — the city’s Human Rights Commission and the Law Enforcement Bureau — would consider a secondment with a minimum salary of $30,000 and a maximum salary of $300,000 to be good faith would depict the salary range,” he adds. But it’s up to investigators to prove that a salary range is not in good faith — not the companies to prove it.
A $90,000 salary range, like the one Citi listed on the amended post that was later deleted, is still “extremely wide” and “raises questions about whether this is a good faith attempt,” he says Beverly Neufeld, President of PowHer New York and a proponent of the new law.
Similarly large ranges could reflect poorly the respect of the companies towards the workers, says Neufeld: “It says a lot about companies when they use potential loopholes. The spirit of the law is to create transparency, and any company with such wide salary ranges doesn’t create transparency.”
Avoid job postings altogether
The law requires employers to post the minimum and maximum salary offered for a specific job if it is listed on an internal job board as well as on external websites such as LinkedIn, Glassdoor, Indeed and other job search platforms. It also applies to any written job description printed on a flyer, distributed at a job fair, or submitted to newspaper classifieds.
In response, some companies may stop posting the job altogether, relying instead on other means of recruiting and hiring.
Some companies may choose to remove job postings and encourage applicants to send their resume to a generic email address. The Wall Street Journal reports. Others might use recruitment firms to source candidates on their behalf, rather than posting a job and announcing the salary range themselves.
Employers could also sidestep compliance if they hire remote workers but say the work can’t be done from NYC. That happened in Colorado, where a similar law went into effect in January 2021. The state Department of Labor warned hundreds of employers to comply with the law and by July had fined three companies for violating it.
Camacho Moran rejects the idea that companies are intentionally trying to circumvent compliance, as it could lead to lawsuits costing an employer time and money.
If a NYC company fails to comply with the new law, job seekers and workers can file a complaint with the city’s Human Rights Commission or leave an anonymous tip. Businesses have 30 days to fix the violation or face civil penalties of up to $250,000.
Despite the patchy application of the law so far, Neufeld is optimistic that companies will continue to tighten their salary ranges with the help of government and law enforcement.
The consequences of the law could prove beneficial for employers and employees alike. Job seekers overwhelmingly support salary transparency, and more than half say they wouldn’t apply to a job or company if salary isn’t listed, according to Monster.com data. Listing salaries could prove to be a good recruiting tool.
“It will take time for people to comply,” Neufeld says, but “over time, companies will see this as a benefit, not a punishment.”
Cash:
“The more transparency the better”: How NYC job seekers say visible salary ranges will help them
Salary Ranges Appear in NYC Job Ads November 1st — Here’s What You Should Know
The 28-year-old former teacher now makes $110,000 – how working for a company with pay transparency has helped
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