A New York City pay transparency law that goes into effect next month is likely to spark a nationwide spike in demands for pay raises from workers, experts told The Post.
Starting Nov. 1, employers hiring in New York City will be required to include the minimum and maximum pay in every job offer, from $15-per-hour dishwashing jobs to seven-figure finance and technology jobs. .
The law is intended to help job seekers avoid applying for low-paying jobs and help reduce racial and gender pay gaps, but its greater effect will spark many “complicated” conversations between bosses and current employees, according to Eli Freedberg, a partner at the employment law firm Littler Mendelson.
“When a current employee sees a new salary posted and it’s on the low end of the range, that’s going to raise some uncomfortable questions,” Freedberg told The Post. “This will have a tangible result in salary inflation for current employees.”
While the the law only applies to the five boroughsExperts say it will have an impact across the country because employers want to be open to hiring remote workers who live in the city. That means every job that could possibly be done in New York City will soon include salary ranges.
Colorado, Nevada and Connecticut have also passed salary range laws in 2021, and states like California and Washington are poised to implement similar measures in the coming months, further raising the likelihood that salary ranges will become standard across the country. country.
Some companies, including real estate listing site Zillow, have already started posting salary ranges online. A typical Zillow listing for a software test engineer reads: “In Colorado, Connecticut, Nevada, and New York City, the standard base salary range for this position is $98,600.00 to $157,400.00 annually.”
Remote workers living in cheaper states can demand higher wages when they see what their colleagues earn in the most expensive coastal cities, Brian Kropp, managing director of consultancy Accenture, told The Post.
For example, a banker in Charlotte, NC, might demand a raise after seeing how much new hires on Wall Street are making, Kropp said.
The bill was originally scheduled to go into effect in May but was delayed until November amid pushback from business groups such as the Partnership for New York City. Kathy Wylde, CEO and president of the group, told The Post that she was glad implementation of the bill was delayed, but she said she still worried that it would hurt small businesses.
A white-collar insurance worker in her 20s told The Post she supports the new law, saying she would likely quit her job if her company posted a listing for an identical position with a higher salary range than hers. .
“If I [found out I] I was being underpaid, I would get mad and probably leave,” said the worker, who asked not to be identified.
Many workers have taken advantage of rising wages and near-record low unemployment to grab higher wages by changing jobs, a trend that has continued. nicknamed the “Great Resignation”. The raises for new hires have set the stage for a wave of older employees demanding better pay, according to Kropp, a human resources expert.
“Companies over the last year have raised the pay of their new hires to lure them into the job market, but what very few have done is raise the pay of their current employees,” Kropp said.
The only reason current employees who make less money than new hires wouldn’t ask for more money is because they have begun “actively looking for a new job at another company,” he added.
Banking industry sources said they are already trying to negotiate salaries by talking to friends at rival banks and looking at data from H1-B visas, which require companies to disclose how much they pay certain U.S.-based foreign workers.
“Smart people already use that as a negotiating tactic,” one banker told The Post.
The bill is expected to have less of an impact on hourly workers in industries like retail and food service, according to Freedberg, as there is less wiggle room for hourly pay in that industry.
“It definitely affects white-collar work more than retail and hospitality jobs,” Freedberg said. “Wages in your fast food sector tend to be pretty contained, say $15 to $22 an hour…there’s not going to be a lot of variation.”
Still, Kropp argued that all workers will benefit from knowing how much a potential job might pay before they apply.
Employers who do not publish salary lists will not be fined if they add ranges within 30 days of being warned that they are not in compliance. If they don’t add the rank or rack up repeat violations, they can face fines of up to $250,000 per violation.