NYC Amends Salary Transparency Law; Delays Effective Date
In February, we examined newly passed New York City Local Law 32, which required employers to disclose salary ranges in job advertisements. The law was set to take effect on May 15, 2022, but, on April 28, 2022, the New York City Council passed an Amendment to Local Law 32 that pushed the effective date of the law back to November 1, 2022.
In addition to delaying the effective date, the Amendment also included changes to Local Law 32 that provide greater clarity on some of the questions that were not fully answered by the original version of the law.
First, the salary transparency law was amended to exclude positions that cannot, or will not, be performed, at least in part, in New York City. This clarification is important in the era of increased remote work, as job advertisements for positions that are open to remote workers who might live in, or be expected to travel to, New York City are likely covered by the law.
Second, the Amendment limits the right to file a cause of action under the law to those employees who have been successfully hired, promoted, or transferred, but were not provided the mandated salary range in the related job advertisement. Unsuccessful applicants will not have a right to bring a lawsuit under this law.
Third, the Amendment adds a new opportunity to “cure” a first-time violation of the salary transparency law within 30 days of receipt of a complaint. This one-time pass will be considered an admission of liability by the NYC Commission on Human Rights, but penalties will be reduced to $0, rather than the $125,000 and $250,000 penalties for non-willful and willful violations, respectively.
On the same day that the Amendment became law, the NYC Commission on Human Rights published a factsheet addressing the application, coverage, and enforcement of the salary transparency law. Notably, the factsheet clarifies the definition of “salary” to include base annual salary or hourly wage or rate of pay but does not include other forms of compensation such as health benefits, retirement benefits, overtime pay, leave, severance, or other forms of compensation such as tips or equity awards. In providing a “good faith” salary range in the advertisement, the Commission makes clear that employers’ vague statements such as “up to” or “a maximum of” a stated salary or hourly rate are not consistent with the law.
In advance of the new November 1, 2022 effective date, New York City employers should be prepared for scrutiny by both applicants and the Commission’s Law Enforcement Bureau.