New York State’s New Pay Transparency Law: What You Need to Know

28 of March, 2023

Pay transparency is a hot button topic right now, and the state of New York just made a big move in this area. New York State Amends Pay Transparency Law went into effect March 2021, and it’s important for businesses in the state to understand just what this new law means for them.

You’re likely familiar with the concept of pay transparency: basically, it involves employers sharing information about how they approach setting wages–including their criteria and practices–with their employees.

This can ensure that everyone is working with information that’s clear and up-to-date. But NY’s new law goes further than that; it requires employers to make certain information available about compensation without being asked for it.

If you’re an HR manager or business owner based in NY, it’s likely that these changes have you scrambling to know exactly what this new set of rules means for you and your team. To help clarify matters, let us give you the rundown on NY’s New Pay Transparency Law and how a document management software can help you.

Overview of the New York Pay Transparency Law

Did you know that the State of New York Amended Pay Transparency Law? This law gives greater clarity when it comes to payments and compensation. In short, employers are now required to provide their employees with details about the wage structure. What does this mean for you?

Well, as an employer it means that you need to understand the new regulations concerning pay transparency in New York State. First, employers are now required to provide written notice to employees about their pay rates and any changes.

Second, employers must post notice of all wage rates for the jobs they offer within their organization. This means that if you have multiple locations or divisions, those sites may need different notices for each job position.

Lastly, employers must also display a poster in a prominent area that describes the employee’s rights under the law and what constitutes a violation of those rights.

By understanding these requirements and complying with them, employers can ensure they are meeting the legal standards set forth in New York’s Pay Transparency Law.

Latest Update in The NY’s Pay Transparency Law

On March 3, 2023 Governor Kathy Hochul of New York State signed a bill amending the state’s pay transparency law (New York Labor Law Section 194-b), taking effect on September 17.

The law was previously applicable to employers with four or more employees, employment agencies, employees, or their agents and required them to disclose compensation or ranges of compensation to job applicants and employees for advertised positions, promotions, or transfer opportunities that could be performed in the state. It also allowed for job descriptions to be included in postings.

The amendments clarify the application of the law by limiting it to positions that will physically take place in New York and removing the requirement for employers to keep records.

“Advertisement” is now defined as “making available to a pool of potential applicants for internal or public viewing, including electronically” descriptions of employment opportunities. Employers should ensure such information is provided for positions physically taking place in New York or reporting to a site in New York, as well as following New York City’s own salary transparency law.

Employers should consult legal counsel regarding other states’ and localities’ laws and regulations around salary transparency.

What Type of Information Employers Must Provide

New York’s pay transparency law requires employers to provide all employees with the following information:

• The rate and basis of all compensation, including: wages, salary, shift differentials, bonuses, overtime rates, and vacation and holiday pay.
• Any incentive or other plan that is based on productivity or output.
• The full amount of any employer-required contributions to employee benefit plans.
• Any other information required by the New York Department of Labor (DOL) and/or the New York State Department of Labor Industrial Code.

In addition, employers must provide this information to any current or prospective employee upon request from either the employee or an authorized representative of the DOL or Industrial Code.

It’s important to note that employers are required to post a notice about these rights in their workplace for employees to be able to access this information. Without this notice and provision of these details, employers can face extensive fines and penalties.

Employers’ Obligations When It Comes to Pay Transparency

Now that you know a bit about the Pay Transparency Law and its recent changes, let’s talk about what employers need to do. With the updated law, employers must include the posted language on their job postings as well as any contracts of employment they provide.

That means employers:

1. Need to update existing job postings that list a wage, salary, or rate of pay to reflect the language mandated by the law.
2. Must provide a written contract for any employee who is hired for a period of more than six months must be provided within 30 days written notice of their rate of pay, allowances (including tips), overtime rates and other forms of compensation such as bonuses or cafeteria plans.
3. Should consider informing anyone in-scope (executives, administrators, professionals, and other employees) with the current law and its changes, so they are aware there is a new requirement in job postings and they are not being discriminated against when it comes to pay transparency.

The goal is for employers to ensure no one falls through the cracks—the state wants everyone who works in New York to be treated fairly and understand their rights when it comes to pay transparency laws.

What Is Considered Protected Information?

Have you ever wondered what is considered protected information under the new pay transparency law? Well, here’s what you need to know:

The new amendments to the Pay Transparency Law list any information that could reveal the salary or wages of a current or former employee as “protected information.” This includes:

• Job titles and descriptions.
• Compensation histories, including base salary and overtime rates.
• Qualifications for employment and promotion.
• Performance reviews and evaluations.
• Schedules, wage rates, and fringe benefits.

In addition, employers must keep protected information confidential unless it is necessary for a legitimate business purpose, such as in response to an administrative order or a subpoena issued by a governmental entity with proper jurisdiction to conduct an investigation related to the job.

It’s also important to note that employers may not seek out or make any inquiries about a current or former employee’s protected information via third parties or other individuals who have access to such information in relation to their employment with the employer.

Conclusion

In conclusion, New York State’s new pay transparency law is an important piece of legislation for businesses to be aware of and comply with.

With the implementation of the pay transparency law, employers will be held accountable for the compensation practices they employ, and must be transparent about the wages offered to employees.

In addition to meeting legal requirements, pay transparency also offers employers and employees the opportunity to build a more equitable workplace. With clear communication about pay, expectations can be set and compensation can be provided in a fair and consistent manner.

We hope that this article has been helpful for you. To keep discovering more abou labor laws and HR insights, stay in Sesame’s blog!