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On December 21, 2022, Governor Kathy Hochul signed laws geared toward bettering “pay transparency,” which can dramatically have an effect on employers’ job commercial practices throughout New York State.
Necessities of the New Legislation
The laws, which is scheduled to take impact on September 17, 2023, amends the New York Labor Legislation to incorporate Part 194-b, titled, “Necessary Disclosure of Compensation or Vary of Compensation.” Part 194-b would require employers with 4 or extra workers to incorporate the next in any commercial for “a job, promotion, or switch alternative that may or might be carried out, no less than partially,” within the State of New York:
- The compensation or “vary of compensation” for the job, promotion, or switch alternative
- The job description for the job, promotion, or switch alternative, if one exists
The time period “vary of compensation” is outlined as “the minimal and most annual wage or hourly vary of compensation for a job, promotion, or switch alternative that the employer in good religion believes to be correct” on the time of the commercial. As a result of each a minimal and a most are required, merely posting a “beginning” or “mid-point” compensation stage might be inadequate to fulfill these necessities. Nonetheless, for positions which are paid solely on a fee foundation, the regulation seems to be glad if the commercial features a easy assertion that compensation shall be primarily based on fee.
Notably, the regulation doesn’t outline what constitutes an “commercial” for a job, promotion, or switch alternative. The regulation can be silent on the extent to which bonus compensation – which, in some industries, constitutes a considerable portion of workers’ total earnings – have to be recognized in coated ads.
The regulation additionally requires employers to keep up data of compliance with Part 194-b, together with “the historical past” of compensation ranges and job descriptions for every job, promotion, or switch alternative they’ve marketed. The regulation is silent on the period of this recordkeeping obligation.
An employer’s failure to adjust to these necessities will lead to obligatory civil penalties of $1,000 for the primary violation, $2,000 for the second violation, and $3,000 for a 3rd or subsequent violation. As well as, any particular person who believes they’ve been aggrieved by a violation of the regulation could search cures towards the employer by submitting a grievance with the New York State Division of Labor (“NYSDOL”).
Lastly, employers are prohibited from refusing to interview, rent, promote, or make use of, or in any other case retaliating towards, an applicant or present worker for exercising any rights beneath the brand new Part 194-b.
Adjustments and Steerage on the Horizon?
Though Governor Hochul signed the brand new laws into regulation, she additionally issued an “Approval Memorandum” which appears to acknowledge a number of the difficulties that employers are more likely to face in complying with the laws as handed. Particularly, the Approval Memorandum states “this laws want[s] a number of fixes to make sure efficient implementation” and that, due to this fact, Governor Hochul has “secured an settlement with the Legislature to make technical modifications” to the regulation. In line with the Approval Memorandum, these technical modifications will:
- “[C]larify job promoting within the regulation”
- “[E]xclude distant job alternatives carried out completely outdoors of the State and not using a connection to a New York workplace or supervisor”
- “[E]liminate the earlier report upkeep requirement for companies”
As well as, the NYSDOL is required to subject guidelines and laws beneath the regulation. Accordingly, employers ought to hold a watch out for legislative and regulatory updates, which we hope will make clear a number of the key open questions surrounding implementation of the brand new regulation.
Déjà vu for NYC and Westchester County Employers
For employers who’ve operations or promote positions in New York Metropolis or Westchester County, this may increasingly all sound strikingly acquainted. It is because comparable native legal guidelines took impact in New York Metropolis on November 1, 2022, and in Westchester County on November 6, 2022.
As reported within the media, New York Metropolis’s regulation is off to a rocky begin with widespread criticism levied towards employers for posting extensive pay ranges. See, e.g., Matthew Boyle & Eric Fan, Bloomberg Information, With Pay Ranges of $2 Million, NYC Transparency Legislation Is Off to a Glitchy Begin (Nov. 1, 2022), accessible here. This can be an indication of issues to return in the remainder of the state.
Notably, the brand new laws expressly states that it doesn’t preempt or supersede any native regulation, guidelines, or laws. Thus, employers in New York Metropolis, Westchester County, and every other locale that has or could undertake native pay transparency legal guidelines might want to guarantee compliance with each the native and the statewide regulation.
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