(NEW YORK) -- A New York City law will require companies with at least four employees to post salary ranges in job listings in an effort to increase pay transparency starting Tuesday.
Employers advertising jobs in the city who have at least one employee currently located there must include a "good faith salary range," according to the New York City Commission on Human Rights, which is enforcing the law. Employers must include a minimum and maximum salary.
There is no fine for a first-time offense, though companies and employment agencies found to violate the law could face civil penalties of up to $250,000 if not corrected within 30 days of receiving notice of the violation.
Temporary staffing agencies are exempt from the law because they already disclose this information under the New York State Wage Theft Prevention Act.
Starting November 1, 2022, the NYC Human Rights Law requires employers to include a good faith pay range in all job postings - another step toward pay equity for New Yorkers.— NYC Human Rights (@NYCCHR) October 28, 2022
Read our fact sheet to learn more about pay transparency. #DisplayThePayNYChttps://t.co/QOu3ETw0NE
The new law, which passed the New York City Council late last year, was set to go into effect in May, though the start date was delayed following criticism from business groups and companies who said they were not consulted about the legislation beforehand and that the language of the law was vague.
The law was also amended to waive a penalty for a first-time violation and clarify that it would not apply to jobs that cannot or will not be performed in New York City, among other changes.
The city follows other jurisdictions that have passed laws to increase pay transparency. Among them, Colorado, Connecticut and Nevada started mandating salary ranges on job postings last year, and similar salary requirement laws will go into effect in California, Rhode Island and Washington state in 2023.
Several companies have already started complying with the New York City law, including Amazon, American Express, Citigroup and Zillow.
Pay transparency advocates who were involved in the new law called it a "game changer for the city's workers," in particular those who face wage disparities, including Black and Latina women.
"With salary ranges out in the open, employers must think critically about how they set pay at the front end of their process before they insert unconscious biases. At the same time, women and people of color have more leverage to advocate for themselves and more information to make better decisions about jobs and industries to pursue, helping to combat occupational segregation," Beverly Cooper Neufeld, president of PowHer New York, and Seher Khawaja, senior attorney for economic empowerment at Legal Momentum, wrote in an opinion piece published in the New York Daily News on Thursday.
The chambers of commerce in each borough and the Partnership for New York City, an organization that represents the city's business leadership, had unsuccessfully pushed for the law to exempt industries with severe labor shortages, as well as only require minimum salary postings for highly compensated jobs.
"New York City is a highly competitive labor market, where most employers are committed to gender and racial pay parity," they wrote in a joint letter in April, arguing that the inclusion of a salary range is "not necessarily the most appropriate tool for the New York labor market."