Pay transparency has been a hot topic this year with states all over the country adopting laws and regulations that require companies to be open about the compensation they provide to workers. This might conjure visions of awkward conversations around pay disparity or problems among co-workers. But don’t let this new legislation give you goosebumps – preparing for and embracing pay transparency helps address any existing inequality and promotes fairness in the workplace.
Ask These Questions
As with all emerging legislation, you have to start with a little bit of homework. Make sure you ask yourself the important questions:
- Where are these laws active? Currently, there is no federal mandate for regulating pay transparency so that means all pay transparency laws are at the state and local level. As of the writing of this blog, ten states have active pay transparency laws, and another five are working through bills of their own.
- What is included in the requirements? While a lot of these laws mirror each other, each one has its own nuances. Some of these laws require employers to include a pay range in job descriptions; some allow job seekers to request pay information at specific points in the interview process; others have reporting requirements; and all include penalties for non-compliance. Taking the time to dig into the details of each law is necessary for understanding its specific requirements.
- How will it affect the business? While adopting policies that align with pay transparency might lead to a bumpy transitional period, there aren’t just legal benefits for complying. Did you know that 85% of job seekers have reported they’re more likely to apply for a job that includes a salary range? And a staggering 92% of American workers support pay transparency. Brands and businesses that embrace these laws build trust, improve their hiring processes, and strengthen their workforce reputation.
Conduct an Audit
Once you understand the ins and outs of various pay transparency laws, it’s time to take stock – did you really think we could get through a blog on compliance and not mention auditing? Look into your current pay practices, identify the areas where you need improvement, and design a plan to fill those gaps. Review and update your company policies, job descriptions, and respective pay ranges to remain in compliance with requirements. You should also establish an internal mechanism for tracking laws like these as they develop and monitoring ongoing compliance.
Take Action
Act! A solid compliance strategy should always include communication and training. Make sure you’re communicating the requirements of these laws to those who need to know, which includes clients, co-workers, and those you employ. Clear messaging about how each party is affected by new legislation and how you plan to comply creates confidence in the service you provide. Train internal resources on things like how to respond in the event of an inquiry, updates to SOPs, or even who to reach out to as the SME on the topic.
Pay transparency doesn’t have to be scary – in an age where workers and lawmakers are pushing for stronger employee rights, having clear messaging and processes in place to comply with these laws is an excellent way to show that your business is committed to fairness, openness, and a more equitable workplace.
The information provided on this blog does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available here are for general informational purposes only.
