California job postings will soon include pay ranges thanks to a new law signed by the governor.
More than 200,000 companies with 15 or more employees will be required to reveal their pay ranges on ads for jobs that will be done in the state. California is the largest state where salary information is required. It is home to 19 million workers and has some of the most influential companies in the world.
The legislation is said to be a big step forward in closing wage gaps between genders.
According to the U.S. Census Bureau, women earn less than men for every dollar they make.
In California, women are paid 88 cents for every dollar men are paid, with the gap increasing for women of color. According to the National Partnership for Women and Families, women in the state lose $87 billion to the pay gap each year.
Jessica Ramey Stender is the policy director and deputy legal director director at Equal Rights Advocates, a legal and advocacy nonprofit that sponsored the salary bill.
Money that could be used for rent, food, diapers, education, and retirement savings. The time has come for pay equity legislation.
The California law will lead other states and cities, according to Stender.
The new law requires employers of all sizes to give an employee a salary range if they want it. Job-seekers aren't the only ones who'll benefit from greater pay transparency, existing employees can check where their salary falls within their own organization and raise discrepancies in pay to negotiate or call for an adjustment
It will require companies with 100 or more workers who are hired through third-party staffing agencies, who often work time-based assignments as W-2 contractors, to submit pay data reports to the California Civil Rights Agency.
A growing part of the modern workforce is comprised of women and people of color who do the same work for less money, according to Stender. It's possible to uncover occupational segregation by reporting pay data based on job and demographic background.
Stender believes that the data can help companies comply with equal pay and anti- discrimination laws.
A company can find out through the data that their administrative staff is mostly women, while their executive-level employees are mostly men. Stender says that collecting that data should be a big eye-opener for them.
Companies with 100 or more direct-hire workers are required to submit job and demographic information.
Aggregate data for public awareness and accountability will likely be published by the state agency. She says that the effort gives enforcement agencies data with which to enforce equal pay and anti- discrimination laws.
There are similar laws in other parts of the U.S.
The Equal Pay for Equal Work act went into effect in January of 2021.
The salary range must be given to applicants after an initial interview, even if they don't ask for it. Employers in Connecticut have to give a salary range if an application is made. Employers in Washington are required to give the minimum and maximum pay range for a job after they make an offer.
The New York City salary transparency law was delayed due to opposition from business groups.
The bill was passed in New York. It could go into effect next year if Kathy Hochul signs it. New York business groups urged the governor to change the legislation to remove a requirement to list employee benefits and carve out exemptions for jobs that can be done remotely.
Stender doesn't expect any changes to the implementation date of the California bill after it was signed into law.
It would not be possible to stop the law from taking effect in January without new legislation.
The new law has a big impact beyond state lines because so many global and national companies are located in California.
When a law like this is enacted, companies that have locations throughout the country and internationally will change their policies to make sure they are in compliance.
According to a survey of 388 business leaders conducted in June and July, 18% of companies are revealing pay range information in parts of the US where it is not required by law. A majority of organizations are considering or planning to disclose pay ranges in the future.
According to a June survey of more than 3,600 people, workers expect more transparency in their salaries.
The direction we are heading has been warned by companies, according to Jamie Kohn, director in theGartner HR practice. Most of the companies I talk to have been trying to figure out the best way to implement it.
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