: ‘Much of the process and decision-making about salary is hidden or secretive’: As New York pay transparency law awaits, here’s how to find out what your coworkers make

United States

New York City job seekers are coming tantalizingly close an upfront answer for a critical question: how much money can I make in this position?

At a time when more people are being more demanding about the salary they expect from a job, a New York City law would mandate employers with four or more workers to include a salary minimum and maximum in job advertisements.

The requirements were poised to take effect May 15 after becoming law in January. A handful of states, including Colorado and Connecticut, now require wage information on job postings as advocates say hush-hush approaches to compensation reinforce longstanding racial and gender wage gaps.

On Thursday, New York City Council Members amended the law, delayingits implementation until Nov. 1, as well as several other alterations. Business groups previously complained, among other things, that the law in its initial form was coming at them too quick.

On Thursday, New York City Council Members amended the pay-transparency law, delaying its implementation until Nov. 1.

During the vote, council member Nantasha Williams, one of the sponsors for a bill revising the law, said the result achieved “an end that reflects the needs of everyone.” She hoped the council “will continue to refine measures to break down barriers like this and ensure everyone has a seat at the table when it comes to pay equity.”

The law, among other things, now makes it clear the requirements also apply to hourly wage work and to “job postings for virtual positions – those that can be done in New York City, are done in the City, or by New York City employers,” said a City Council press release on the law. Transfers and promotions also have to include pay ranges under the law.

The Thursday vote “gives businesses and nonprofit organizations a more realistic timeframe for compliance and some forbearance on penalties and exposure to litigation,” said Kathryn Wylde, president and CEO of the Partnership for New York City, a non-profit organization representing New York City’s business community.

Though Wylde and other business leaders felt the initial version passed through without business input, the revised law showed the local legislators’ willingness to consider business perspective. “The result will be to more quickly achieve our shared goals of racial and gender pay equity,” she said in a statement.

Younger workers are more willing to share

Until the law takes effect, surveys suggest there’s another way to glean salary information. Firstly, check sites like CareerBuilder, Glassdoor or Salary.com, and then give colleagues a range, allowing them to point you in the right direction without giving away their exact salary. If you just straight-out ask potential or existing co-workers, you may have better luck with some more than others.

For example, 42% of workers aged 18 to 25 and 40% of workers between the ages of 26 and 41 say they’ve talked about their salary information with a co-worker or another professional contact, according to a Bankrate survey last month. By contrast, 31% of workers, ages 42-57, and 19% of workers from age 58 to 76 say they’ve done the same.

In another recent survey, 42% of people said they’ve talked about pay with a co-worker, according to a survey from FlexJobs.

One third said their company is very transparent, while another 32% say their company is a little transparent and 35% said their company is not transparent.

Change in salary transparency happens gradually

A survey of employers shows the limits when it comes openness about pay.

When Mercer, a human resources firm, asked employers about their approach to pay transparency the results in March said 12% increased their approach and another 24% were considering it.

Of the 12% that increased their openness, the top reason was because of changing philosophies and strategies on pay (64%) and four in ten cited changing expectations from workers. Law changes were the reason for 36% in a portion of the survey allowing multiple responses.

“One of the reasons why we continue to see persistent pay disparities both in gender and race is so much of the process and decision-making about salary is hidden or secretive,” said Valerie Wilson of the Economic Policy Institute, a left-leaning think tank.

Wilson, director of the think tank’s Program on Race, Ethnicity, and the Economy, can’t quantify it, but does feel there’s more worker willingness to discuss pay — and that’s an important first step. Still, “you do need laws that really formalized it as a practice that everyone is required to adhere to.”

That’s especially the case now, because transparency laws can arm workers with the wage gap-narrowing information at a moment when so many women were trying to bounce back from the COVID economy’s harm to their career and savings, said Andrea Johnson, the National Women’s Law Center’s director of state policy, workplace justice & cross-cutting initiatives.

There’s been momentum on the issue and “salary range transparency is needed now. It’s urgently needed. Laws help accelerate that change.”

The organization’s testimony on the New York City law noted the power of salary information. “Nationally, the gender-based wage gap for all full-time workers, based on median earnings, is 18%. However, in the federal government, where pay rates are publicly available, the gender-based wage gap in 2017 was 7%,” the filing said.

The gender gap in New York City salaries

During the New York City Council vote, Williams noted white women in the city were making 84 cents on the dollar versus white men, pointing to research from the city’s Commission on Gender Equity. Hispanic women earned 46 cents for every dollar a white man earned, while it was 55 cents for Black women and 63 cents for Asian American women, she said.

The numbers were “startling” she added.

National numbers mirror the trend. Last year, median earnings for all women were 83% of what men earned, according to data from the Bureau of Labor Statistics.

Companies are supportive when it comes to pay parity and transparency, said Wylde. But there’s a couple things to consider. First, a strict focus on salary might not reveal the full picture because it doesn’t detail other forms of compensation, bonuses and benefits.

Besides, many employers are facing labor shortages and workers who are extremely willing to look around, Wylde said. The pay and compensation floated to people who have been on staff before the pandemic might look different compared to what’s being offered now, Wylde said. More information now could make existing workers raise eyebrows while tipping off competitors on pay.

“From an employer standpoint, this is a tough moment to be transparent because they are just figuring out what kind of incentive compensation they have to offer to attract and retain talent.”

It’s important to have laws in place now, Johnson said. Job seekers have sway in this market, but what about a future point when employers are the ones with the leverage, she said. “We still have that law maintaining that baseline.”