Since our last post on this topic, pay transparency laws were enacted or became effective in four states, the District of Columbia, and several municipalities. The jurisdictions that require or will soon require some form of pay transparency now include:

If you do not operate in these jurisdictions, you may still be subject to pay transparency requirements if you employ remote workers or recruit across state lines. A few jurisdictions expressly prohibit employers from attempting to avoid compliance by noting that residents of those jurisdictions may not apply.

While the pay transparency laws in each jurisdiction differ in some respects, they generally require you to disclose certain salary or wage information in job postings or at some other point in the hiring process or employment relationship. Many of these laws also bar you from asking candidates about their salary history. Proponents believe these laws will reduce gender pay gaps, smoke out discriminatory pay practices, and level the playing field for all workers by allowing them to negotiate more effectively during the hiring process. 

The pay transparency legislation that either passed or became effective in 2024 includes:

Hawaii

As of January 1, 2024, Hawaii requires employers with 50 or more employees to disclose in job postings an hourly rate or salary range that reasonably reflects the actual expected compensation for the job. While the law does not define “expected compensation,” it does clarify that the disclosure of certain components of total compensation, such as benefits, are not subject to the disclosure requirements. Hawaii previously enacted a salary history ban that took effect on January 1, 2019, and prohibits employers from asking job applicants to disclose their compensation history.

Illinois

Effective January 1, 2025, employers with 15 or more employees who recruit for positions performed, at least in part, in Illinois or that report to a supervisor in that state, must disclose the following in job postings: the wage and salary range and a general description of the benefits and other compensation expected to be paid for the position, including but not limited to bonuses, stock options, and other incentive pay. Employers subject to the disclosure requirement may comply by including a hyperlink to a publicly viewable webpage that includes the required pay scale and benefits information. Employers must also make promotion opportunities known to current employees no later than 14 calendar days after they post the position externally.

Minnesota

Signed into law on May 17, 2024, Minnesota’s new pay transparency law will require employers with 30 or more employees to disclose the starting salary ranges and provide a general description of benefits and other compensation expected to be provided for the open position. Salary ranges may not be open-ended, and if a fixed pay rate is offered, it must be listed in the job posting. The Minnesota law will take effect on January 1, 2025.

Vermont

Vermont’s pay transparency legislation was signed on June 4, 2024, and will take effect on January 1, 2025. It requires employers with five or more employees to post the minimum and maximum hourly pay rate or salary range for job roles, including roles that are partially paid by tips or commissions. The law applies to positions performed in Vermont or remote roles predominantly conducted for the benefit of worksites in Vermont. Vermont’s attorney general will provide additional guidance regarding the new law’s requirements by its effective date.

Washington, D.C.

Effective March 25, 2024, Washington, D.C.’s new pay transparency law requires employers to include in job postings and job descriptions the minimum and maximum salary ranges they in good faith believe will be paid for a role. The law also requires employers to disclose available healthcare benefits before the first interview and prohibits employers from seeking a job applicant’s salary history. The law applies to employers with at least one employee in D.C.

Predictions and Takeaways

Employers should continue to stay apprised of the growing list of states and localities with pay transparency laws and take steps to comply with those laws, including reviewing and modifying job postings, job descriptions, and job applications.

More pay transparency laws will be passed as this trend continues to gain momentum across the United States. As pay transparency in job postings become the norm, employers may need to voluntarily include wage and salary information to remain competitive in recruiting.

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