NYC’s New Pay Transparency Law Could Help Close Racial and Gender Pay Gaps

Photo: Andrey_Popov (Shutterstock)

Photo: Andrey_Popov (Shutterstock)

If you think the person in the cubicle next to you is getting paid more than you are for the same job, you could soon have a reliable way to find out. Starting November 1, employers in New York City must provide “a good faith salary range for every job, promotion, and transfer opportunity advertised,” according to the city’s Commission on Human Rights.

The law applies to companies with four or more employees or one or more domestic workers as long as at least one employee works in New York City. Overtime pay, paid time off and benefits coverage are not included in the salary transparency requirement.

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Pay transparency is a valuable tool that could help close the racial and gender wage gap. According to Equal Pay Today, the discrepancy for Black women compared to non-Hispanic white men is 67 cents for full time, year-round workers. And the Bureau of Labor Statistics reported that Black men earned 76 percent of what white men earned in the first quarter of 2022.

According to Seher Khawaja, senior attorney for economic empowerment at Legal Momentum, the new law makes companies accountable to ensure their employees are paid fairly.

“It puts their feet to the fire to think about how they’re setting pay and to avoid discriminatory practices that were working their way in previously,” Khawaja said.

When it comes to salary transparency, Colorado led the way as the first state to push through a law back in 2019. Since then, other states have followed suit, including California, Maryland, Nevada, and Rhode Island.

NYC’s Commission on Human Rights will investigate complaints of discrimination or violations of the city’s new law and give employers a chance to update their job postings. But if they don’t make things right, employers could face penalties up to $250,000.

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