On Tuesday, March 30th, Human Resources experts gathered for another iteration of the HR RoundTable (HRRT). TemPositions’ own Roger Oliver, our Director of Strategic Accounts, founded HRRT. It serves as a venue where Human Resources professionals discuss the dynamic HR landscape. This time around, Joseph H. Harris, Labor and Employment partner at Barton LLP, presented. In the hour and a half long conversation, a few key topics surfaced. Participants eagerly joined to examine the NYC Pay Transparency Law and its effect on HR practices.
The NYC Pay Transparency Law went into effect at the end of 2022. It states that, if an organization has four or more employees, all job postings must include an “accurate, good faith estimate of either the minimum and maximum salary range, or the rate of hourly rates that are going to be potentially paid,” Harris shared. What’s more, if the position is commission-based, employers must state that in the description.
So where should this information be shared for New York City jobs? In short: “everywhere,” Harris remarked, “including internal and external job boards,” regardless of the location, there’s still “protections for discrimination and retaliation
What is a “good faith” range?
Employers must list both a minimum and a maximum potential salary. Harris recommends an internal pay audit, “to make sure that the ranges…are accurate.” Furthermore, it’s important to “check for consistency between roles that are currently occupied and ones that you’re hiring for.
How thorough should the internal pay audit be?
Picture this: a current employee stumbles across a job post and finds their current job description. Here, they uncover that “you’re offering substantially greater pay than they’re being paid.” This, as you imagine, will “create some problems internally,” Harris warns.
HR can prevent this by reviewing existing job descriptions and setting expectations for roles that are both occupied and open. What’s more, they can take it a step further with a pay equity audit to discover any discrepancies in compensation. “You might find,” Harris shared, “there are unintended, but, nonetheless, disparities around how certain groups are paid and how much they are paid.”
Taking these steps ahead of time will prevent headaches down the line. “[It’s] better to do [pay audits] proactively than to put all this information out there and figure out after-the-fact that you might have a problem.” One final tip? “Consider [executing] the pay equity audit under the cloak of attorney-client privilege because, no matter how compliant employer you are, sometimes there are surprises. And if it’s not a privileged audit, then it’s fair game and discovery.
If you find an ideal candidate, are you able to increase the salary range?
Yes, employers can increase the range, but ideally this will be the exception rather than the rule. “Let’s say you develop a pattern,” Harris explained, where “your range of compensation always seems to be below the range that’s eventually offered. I think that’s going to be a problem.” If the required good faith estimates are inaccurate, then more work should be done internally to make a more educated estimate. “A one-off is not the end of the world,” Harris said. But, if it’s a common occurrence, it’s worth asking: “’how could this really be a good faith range if we’re constantly going outside of it one way or the other?”
Implementing the NYC Pay Transparency Law
The NY Pay Transparency Law is just one part of the ever-evolving HR landscape. The prevailing message? Act in good faith, conduct an internal pay audit, and keep records of your job descriptions. Your employees, both present and future, will thank you.
Join the next HR Roundtable
Don’t miss our next discussion! Sign up for TemPositions’ next HR Roundtable here. This SHRM certified event will earn you or your HR team members 1.5 professional development credits.
Please note: the information reflected in this post is not official legal advice nor does it necessary reflect the opinions of the associated firms.