More states are requiring salary ranges on job listings

California’s new law would require employers with at least 15 workers to include the hourly rate or salary range on job listings. The bill is heading to Governor Gavin Newsom, who has until Sep. 30 to either veto or sign it into effect.

More than a dozen states and localities have some sort of law requiring salary disclosure. And since 2018, eight states have passed laws requiring employers to post salary ranges on job listings.

Some laws, such as in Colorado, prevent employers from inquiring about their employee’s past salary experience as well. Twenty states have protections in place to allow employees to discuss their wages with a colleague without facing retaliation from an employer.

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How these laws can change the employment landscape

Experts like Johnson have advocated for these laws to help reduce racial and gender wage gaps — which often get swept under the rug when there’s less transparency in the workplace.

Women earn 83 cents for every dollar a man makes, according to 2021 data from the Bureau of Labor Statistics. And Department of Labor data indicates most racial minority groups also earn significantly less on average compared to white workers.

California’s new law also says companies based in the state with more than 100 employees will also need to show their median gender and racial pay gaps, which is a notable first for a U.S. state.

“I think we're in a moment of cultural change in the last few years, where employers are realizing that it's actually to their advantage to be more transparent about pay,” says Johnson, adding that the country is still contending with a tight labor market.

July data from the U.S. Bureau of Labor Statistics shows that there were 11.2 million job openings on the last day of the month — compared to 11 million openings in June. Johnson believes employers who post their salary ranges may have better luck attracting new talent.

She says by being more transparent, those companies will have an easier time building trust with employees.

“Transparency is power,” she says.

However, there’s also been some pushback from businesses. New York City’s pay transparency law was delayed from May to November. And some companies have reportedly been excluding remote work applicants from Colorado, which requires that even companies that aren’t based in the state follow its pay transparency law for an employee who does reside in Colorado.

Are there any drawbacks to these laws?

These pay transparency laws can vary across the country, which means employees and employers need to do their research first.

“The devil is in the details,” notes Beth Ann Lennon, a labor and employment lawyer at Sherman & Howard, based in Denver, Colorado.

Some states require salary postings on job postings, while others only provide this information upon request or during the application process. Some may require companies hiring outside of the state to adhere to the same rules.

And Lennon says while the intent behind these laws may be to encourage more open dialogue around pay and to address pay inequity, she adds, “Whether that intent is being accomplished, I think, is more of the open question.”

She offers the example of an employee negotiating for a higher salary in a state like Colorado that bars employers from using past wage experience to determine the employee’s current salary.

“There are laws telling you ‘Don't talk to your employees in the way that you historically have’ — as it relates to what are your pay expectations, what have you made in your last jobs? That kind of back and forth sometimes really helps an employee advocate for themselves,” Lennon explains.

“And so one of those tools that an employee may have previously had is gone.”

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What do employees need to know?

If you’re trying to figure out how your pay compares to your coworkers, you may have considered sharing your salary information with them, or asking them about their own.

But talking about salary with a coworker remains a controversial topic — some employers still discourage the practice.

Under the National Labor Relations Act, employees have the right to talk about wages with another employee, while some states also include their own laws and protections around discussing pay.

“But that doesn't always stop an employer from retaliating and somebody potentially being demoted or losing their job, which can be really harmful and not immediately remedied,” notes Johnson.

For those who’d prefer to keep that information to themselves, Lennon says you also have the right to not engage in conversations about salary with another employee as well.

And as for anyone who’s on the hunt for a new job, Johnson recommends looking into your state’s laws.

If you’re able to request salary information from a potential employer, she says it’s important to do so as quickly as possible to help you decide how to negotiate.

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About the Author

Serah Louis

Serah Louis

Senior Staff Writer

Serah Louis is a staff writer with MoneyWise.com. She has a Bachelor of Science from the University of Toronto, where she double majored in Biology and Professional Writing and Communications.

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